Washington and Boston, 22nd- 26th June 1998

25th June 1998

MIT has a well-regarded track record in creating new inventions and in following up with spin-off companies and licensing agreements which turn scientific knowledge into new products and processes. MIT claims that if the companies formed by its faculty and students were added together they would create the twenty-fourth largest economy in the world. It has spun-off some 4,000 companies which currently employ 1.1 million people and had sales of $232 billion per annum.

1   Meeting with Dr David Staelin, Assistant Director, Lincoln Laboratories, Massachusetts Institute of Technology and Professor James Utterback, Professor of Management and Engineering, MIT Sloan School of Management[191]

Topics discussed: The value of applied research; terms and conditions of employment of faculty members; spin-out companies; Governmental technology assessment.

2   Meeting with Dr Daniel Roos, Associate Dean of Engineering Systems and Former Director of the Center for Technology Transfer and Product Development, MIT

Topics discussed: The rôle of the Centre for Technology Transfer and Product Development; Key factors in company development and competitiveness; Liaison between researchers and industrialists; research funding; university and industry relations.

3   Meeting with Professor Joel Moses, Provost and former Dean of Engineering, MIT

Topics discussed: Attracting industry to work with academic institutions; attracting research funding from overseas; the importance of research excellence; fostering spin-outs and start-ups; patenting.

4   Meeting with Professor Daniel Wang, Professor of Chemical Engineering and Director of the Biotechnology Process Engineering Centre, MIT.

Topics discussed: The rôle of the Biotechnology Process Engineering Centre, its industrial partners and funding mechanisms; The National Science Foundation's Engineering Research Centres.

5   Meeting with Ms Lita Nelson, Director of the Technology Licensing Office, MIT

Topics discussed: Facilitating technology transfer through technology licensing; generating revenue through technology licensing; capitalising on federally funded research; industrial liaison; international and domestic patenting; supporting spin-out companies.

6   Meeting with Dr Warren Seering, Director of the Center for Innovation in Product Development, MIT

Topics discussed: Joint academic/industrial ventures and partnerships; the importance of incremental and step change product innovation and associated research; the rôle of the Center's industrial partners; educating engineers in product development.

26th June 1998

7   Meeting with Dr John VanderSande, Associate Dean of Engineering, MIT

Topics discussed: The management structure of MIT; federal funding for defence related research; the MIT undergraduate programme; attracting students to engineering; tuition fees.

8   Meeting with Professor James Utterback, Professor for Management and Enterprise, MIT Sloan School of Management

Topics discussed: The relationship between manufacturing and engineering; success records for high technology start-ups; the importance of serial entrepreneurs.

The Massachusetts Technology Collaborative is an independent public economic development organization established by the State to foster a more favourable environment for the formation and expansion of technology­intensive enterprises. Focussing on technology-intensive enterprises, it seeks to identify and develop economic clusters — small groups of enterprises with strong logical ties to each other and which might benefit by greater communication and collaboration. It works with identified clusters on common concerns and to help bring about collaborative action.

9   Meeting with Mr Joe Alvani and other representatives of Massachusetts Technology Colloborative

Topics discussed: Identifying clusters; the benefits of company collaboration on non-competitive issues; the Government's rôle in the innovation process.

MTDC, established with the implicit mission of creating jobs and bridging the capital gap for start-up companies, was endowed with a small investment fund ($10 million) which had grown over the years. Most MTDC finance deals were between $700,000 and $2 million and were made with companies looking for their second round of financing. In return for the investment, MTDC expected to be involved with the management of the company and had a share in the equity. Since 1978 MTDC had invested $38.5 billion in eighty-eight different companies. Returns on the investments flowed back into the fund. For every dollar it invested, MTDC saw a return of $17.5 dollars. MTDC had been self-financing for many years. In 1997 MTDC-assisted companies had employed 8200 people.

VenturCom was established in 1980 by colleagues at MIT. Its aim was to provide tools to software engineers to help them develop software products. MTDC, Intel and Microsoft had recently invested in the company and at the moment it was developing products for Windows engineers. VenturCom had fifty-five employees. Its headquarters were in Boston but it had a worldwide customer base.

10   Meeting with Mr John Hodgman, Director of MTDC, Mr Michael Dexter Smith, President and Chief Executive Officer, VenturCom, and others.

Topics discussed: The rôle of MTDC and its support for start-up companies; VenturCom's experience working with MTDC; intellectual property and the IT industry; the importance of venture capital.

191  Professor James Utterback was present throughout all the Committee's meetings at Massachusetts Institute of Technology. Back