America's next top energy innovator challenge

Boston, MA - As part of the Obama Administration's Startup America Initiative, U.S. Energy Secretary Steven Chu announced the "America's Next Top Energy Innovator" challenge, which will give start-up companies the opportunity to license groundbreaking technologies developed by the National Laboratories for $1,000 and build successful businesses. As part of this effort, the Department is reducing both the cost and paperwork requirements for start-up companies to obtain an option agreement to license some of the 15,000 patents and patent applications held by our 17 National Laboratories.

"America's entrepreneurs and innovators are the best in the world," said Secretary Chu. "Today, we're challenging them to create new businesses based on discoveries made by our world-leading national laboratories. Because we've cut the upfront fees and reduced the paperwork, we'll make it easier for start-up companies to succeed and create the new jobs our economy needs. Our goal is simple: unleash America's innovation machine and win the global race for the clean energy jobs of the future."

Currently, only about 10 percent of federal patents have been licensed to be commercialized. This initiative aims to double the number of startup companies coming out of the National Laboratories.

Specifically, as part of "America's Next Top Energy Innovator:"

1. On Monday, May 2, 2011, the Department will kick off the challenge by posting a streamlined template option agreement online for entrepreneurs to submit to Laboratories. Entrepreneurs must identify the technology of interest and submit a business plan to be considered for the program. Participants will have until December 15 to make their submission to the Laboratory.
2. Any of the 15,000 unlicensed patents and patent applications held by the National Laboratories will be available for licensing by startup companies
3. From May 2 to December 15, the Department will reduce the total upfront cost of licensing DOE patents in a specific technology to a $1,000 upfront fee for portfolios of up to three patents. This represents a savings of $10,000 to $50,000 on average in upfront fees.
4. Other license terms, such as equity and royalties, will be negotiated on a case by case basis and will typically be due once the company grows and achieves widescale commercial success. These fees help support the Department's continuing research activities to develop new technologies.
5. The Department will simplify the licensing process and establish a standard set of terms for start-ups, who generally lack the resources, time or expertise to negotiate individual licensing agreements. This will significantly reduce both the time and cost required to process the license, allowing faster access to the Department's patents and enabling the Department to process more licenses in a shorter amount of time.
6. Entrepreneurs who complete the process and demonstrate progress toward executing their business plan and commercializing the technology will have the opportunity to be showcased at the 3rd Annual ARPA-E Energy Innovation Summit in 2012, which brings together leading technology startups and clean energy investors from around the country.

In addition to these steps, the Department is making it easier for companies to use the world-leading facilities at our National Laboratories to conduct collaborative research and development activities. Previously, companies had to make an upfront payment covering the first 90 days of research work - a requirement that was often difficult for start-ups to meet. Today, the Department is lowering the advance payment requirement to 60 days. This change will benefit all companies - not just start-ups - but could be valuable for those participating in the "America's Next Top Energy Innovator" challenge.

Entrepreneurs interested in participating can already view the available technologies on the Department's Energy Innovation Portal.

Social Impact Investing in Small and Growing Businesses on the Rise, Report Finds

[from Philanthropy News Digest] Despite record levels of investment in small and growing businesses (SGB) in the developing world, additional capital and better data on social impact are needed if the sector is to reach its full potential, a report from the Aspen Network of Development Entrepreneurs finds.

According to the 2010 ANDE Impact Report (44 pages, PDF), between 2001 and the first half of 2010, 199 funds raised a total of $10.6 billion to invest in emerging market SGBs. Over the past year, ANDE — a global network of more than 110 investors — has grown by thirty-seven members and expanded into eighteen additional countries.

Collectively, ANDE members manage sixty-three SGB funds, accounting for some $900 billion across 2,500 investments. Since the network's inception, ANDE members have supported more than 11,000 SGBs through capacity development, direct equity, or debt investment.

"Increasingly, the development community is recognizing that market-based approaches offer a more effective model for providing key products and services to needy populations," said ANDE executive director Randall Kempner. "Meanwhile, the traditional investment community is recognizing the potential of making financial returns while improving society. This convergence is leading to a greater understanding of the power of SGBs as well as increased capital flows into the sector."

“Aspen Network of Development Entrepreneurs Releases Second Annual Impact Report.” Aspen Network of Development Entrepreneurs Press Release 4/29/11.

Erie Innovation Fund Accepting Applications

There’s still time to apply to the Erie Innovation Fund. The purpose of the fund, which is a partnership between the Erie County Gaming Revenue Authority and Ben Franklin Technology Partners, is to give Erie’s tech-based entrepreneurs and small manufacturers access to local investment capital.

To date, more than a dozen companies that are involved in new product/process development have inquired about the application process. Screening of the applicants and the subsequent review of the proposals will be based on Ben Franklin’s existing due diligence process. However, a local panel of experts and potential investors is being convened to help evaluate submitted proposals.

Companies that receive funding will also have the opportunity to get business mentoring and support from the Ben Franklin Transformation Business Services Network.

Business owners who are interested in applying for funding, or potential investors who want to participate in the Advisory Board, should contact Ben Franklin’s Erie Office at 898-6650.