[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]


     THE INNOVATION PIPELINE: FROM UNIVERSITIES TO SMALL BUSINESSES

=======================================================================

                                HEARING

                               BEFORE THE

          SUBCOMMITTEE ON INNOVATION AND WORKFORCE DEVELOPMENT

                                 OF THE

                      COMMITTEE ON SMALL BUSINESS
                             UNITED STATES
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED SIXTEENTH CONGRESS

                             SECOND SESSION

                               __________

                              HEARING HELD
                           FEBRUARY 11, 2020

                               __________

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
                               

            Small Business Committee Document Number 116-071
             Available via the GPO Website: www.govinfo.gov
             
             
                               __________
                                       

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
39-605                  WASHINGTON : 2021                     
          
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                   HOUSE COMMITTEE ON SMALL BUSINESS

                 NYDIA VELAZQUEZ, New York, Chairwoman
                         ABBY FINKENAUER, Iowa
                          JARED GOLDEN, Maine
                          ANDY KIM, New Jersey
                          JASON CROW, Colorado
                         SHARICE DAVIDS, Kansas
                          JUDY CHU, California
                           MARC VEASEY, Texas
                       DWIGHT EVANS, Pennsylvania
                        BRAD SCHNEIDER, Illinois
                      ADRIANO ESPAILLAT, New York
                       ANTONIO DELGADO, New York
                     CHRISSY HOULAHAN, Pennsylvania
                         ANGIE CRAIG, Minnesota
                   STEVE CHABOT, Ohio, Ranking Member
   AUMUA AMATA COLEMAN RADEWAGEN, American Samoa, Vice Ranking Member
                          TROY BALDERSON, Ohio
                          KEVIN HERN, Oklahoma
                        JIM HAGEDORN, Minnesota
                        PETE STAUBER, Minnesota
                        TIM BURCHETT, Tennessee
                          ROSS SPANO, Florida
                        JOHN JOYCE, Pennsylvania
                       DAN BISHOP, North Carolina

                 Melissa Jung, Majority Staff Director
            Justin Pelletier, Majority Deputy Staff Director
                   Kevin Fitzpatrick, Staff Director
                           
                           
                           C O N T E N T S

                           OPENING STATEMENTS

                                                                   Page
Hon. Jason Crow..................................................     1
Hon. Troy Balderson..............................................     2

                               WITNESSES

Dr. John Younger, Vice President of Science and Technology, 
  University City Science Center, Philadelphia, PA...............     5
Dr. Sheila Martin, Vice President of Economic Development and 
  Community Engagement, Association of Public and Land-grant 
  Universities, Washington, DC...................................     7
Dr. Ethan Mann, Vice President of Marketing and Business 
  Development, Sharklet Technologies, Inc., Aurora, CO...........     9
Dr. Gregory P. Crawford, President, Miami University, Oxford, OH.    10

                                APPENDIX

Prepared Statements:
    Dr. John Younger, Vice President of Science and Technology, 
      University City Science Center, Philadelphia, PA...........    24
    Dr. Sheila Martin, Vice President of Economic Development and 
      Community Engagement, Association of Public and Land-grant 
      Universities, Washington, DC...............................    30
    Dr. Ethan Mann, Vice President of Marketing and Business 
      Development, Sharklet Technologies, Inc., Aurora, CO.......    40
    Dr. Gregory P. Crawford, President, Miami University, Oxford, 
      OH.........................................................    42
Questions for the Record:
    None.
Answers for the Record:
    None.
Additional Material for the Record:
    Association of Public & Land-Grant Univeresities.............    48
    Engine.......................................................    53
    Hon. Abby Finkenauer, Member of Congress.....................    57
    Letter from Janeya Griffin, CEO, The Commercializer, LLC.....    59

 
     THE INNOVATION PIPELINE: FROM UNIVERSITIES TO SMALL BUSINESSES

                              ----------                              


                       TUESDAY, FEBRUARY 11, 2020

                  House of Representatives,
               Committee on Small Business,
          Subcommittee on Innovation and Workforce 
                                       Development,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 10:03 a.m., in 
Room 2360, Rayburn House Office Building, Hon. Jason Crow 
[chairman of the Subcommittee] presiding.
    Present: Representatives Crow, Finkenauer, Kim, Davids, 
Houlahan, Balderson, Chabot, Hern, Burchett, and Joyce.
    Chairman CROW. Good morning. The Committee will come to 
order.
    We want to thank everyone for joining us this morning, and 
especially to the witnesses here today. For those of you who 
have not testified before a Committee, the way that these 
Subcommittees usually work is members sometimes have 
overlapping Subcommittees and obligations, so people will come 
and go throughout the Committee and ask questions during the 
time that we have allotted today.
    So that that, I wanted to make an opening statement before 
I turn it over to Mr. Balderson, the Ranking Member.
    This past year, this Subcommittee has seen a lot of 
inspiring examples of the value of innovation and 
entrepreneurship. For decades, the U.S. has led the world as 
the best place to innovate and start a small business. A large 
driver behind this innovation, however, is our commitment to 
publicly funding research and development in health care, 
science, and technology. And as a result of that, hundreds of 
patents are developed on our Nation' s college campuses every 
year. Products like lifesaving drugs, groundbreaking medical 
devices and advances in agriculture are the result of 
collaboration among faculty, students and the business 
community.
    These innovations, made possible in some part by public 
investment, are needed now more than ever as technology rapidly 
changes every sector of our economy. However, as more states 
cut funding for research-based universities, the Federal 
Government' s role in supporting innovation is more important 
than ever.
    For an economy as large and diverse as ours, the only way 
for sustained economic growth is through innovation that 
results in new solutions or improvements in products or 
services. The U.S. Government made Federal R&D funding a 
priority starting in World War II, and those investments have 
paid off. Federal funding is responsible now for approximately 
30 percent of all new U.S. patents every year.
    The story is different now and the U.S. is one of the only 
OECD countries that has decreased public investment in R&D over 
the past 25 years. I believe we should be working together to 
support increased investment in research and development, 
particularly at our colleges and universities where our next 
generation of innovators are being developed.
    But research and development funding is only one part of 
the equation. Bringing an idea from a university lab to 
consumers is no easy process as we have heard from a lot of 
businesses and innovators over the past year. There are 
numerous steps involved, from developing a business plan to 
doing market research to licensing the technology and security 
venture capital funding. Fortunately, universities and 
organizations are working all around the country to make this 
process easier. By providing space in incubators and 
accelerators, universities can cultivate emerging technologies 
and leverage their vast networks for fundraising and 
mentorship.
    The knowledge available to entrepreneurs in these 
environments can help them through the so-called ``valley of 
death,'' another thing that we have heard a lot about from 
entrepeneurs directly. And that is where the technology is not 
yet perfected, and investors are hesitant, and many startups 
fail to get off the ground and get through the ``valley of 
death.''
    In my district, the Fitzsimmons Innovation Community, in 
partnership with CU Anschutz, the Children' s Hospital of 
Colorado and UC Health is providing vital support for 
bioscience research, innovation, and commercialization. Another 
example of the success of the intersection of small business 
and Federal R&D are the SBIR and STTR programs, which work to 
commercialize cutting-edge technology. Over the last 3 decades 
the SBIR program has boasted significant return on investment 
and has generated billions in tax revenue.
    A priority for me as the Chair of this Subcommittee is to 
identify how policymakers can help rebuild and develop the Main 
Streets of our country. Whether it is a tax startup in Kansas, 
a medical device company in Colorado, a pharmaceutical research 
firm in Philadelphia, or any small business in any city or town 
across the country, we know these public-private partnerships 
accelerate innovation, provide jobs, and support our 
communities.
    So, I hope that today' s discussion will shed light on the 
many benefits of the innovation pipeline taking place at our 
Nation' s universities. And I look forward to working with my 
colleagues in Congress so more small businesses can bring their 
ideas to market.
    So now I would like to yield to our Ranking Member, Mr. 
Balderson, for his opening statement.
    Mr. BALDERSON. Thank you, Chairman Crow. Thank you, 
witnesses, for being here today.
    Studies show that when universities and firms both have 
close personal and geographical links, these connections help 
produce greater innovation outcomes. Ohio colleges and 
universities spent nearly $2.4 billion in fiscal year 2018 on 
research and development activities, landing the 12th District 
on the R&D state ranking. Ohio State University, which has 
campuses in my district, led the state with $875 million in R&D 
expenditures and is ranked 25th of American research 
universities.
    So how can close ties between universities and local firms 
help business innovation? Just last week I participated in a 
hearing about the SBIR/STTR programs held by the Research and 
Technology Subcommittee of the Space, Science, and Technology 
Committee. I asked the panel about the biggest burdens faced by 
small businesses in the R&D space and learned that they need 
help in two major ways--risk assessment of their technologies 
and general startup resources for business planning and 
management.
    This is where the ties between universities and local firms 
come in. Institutions that take advantage of both personal and 
geographical links between R&D and entrepreneurship are able to 
effectively transform potential into product and scientists 
into businessmen, or women.
    A recently published book, Jumpstarting America, 
illustrates how two MIT professors developed an index system of 
metro statistical areas or MSAs--very challenging words to put 
all together there--to rank each one' s potential to becoming 
the Nation' s next great tech hub. MSAs were ranked by 
workforce size, four education measures, and three lifestyle 
measures. The education measures qualify workforce and 
production elements required to support research and 
development systems. I am proud to say that six Ohio cities 
made the list, including Columbus in my district, which was 
ranked number 4 out of 102 metropolitan areas. Columbus and its 
surrounding communities offer a great quality of life and have 
unlimited potential for high-tech industries thanks to our 
local colleges and universities.
    Jumpstarting America and similar economic development 
studies are limited in scope for various reasons to urban 
areas. But, what about our rural areas? Surely, there are great 
innovations coming from the heartland universities.
    Last month, the Subcommittee discussed ag tech 
entrepreneurship as a catalyst for rural revitalization 
efforts. Our witness for the hearing, Dr. Douglas Jackson-Smith 
represented Ohio State University' s Innovation for Food and 
Agricultural Transformation, a project that embodies many of 
the themes we will be discussing today. At this hearing, we 
will examine the local impact of universities as centers of 
innovation. While some excel at technology transfer and 
commercialization, others act as a keystone of entrepreneurial 
ecosystems.
    I appreciate the witnesses' work in this space and look 
forward to hearing your success stories.
    I yield back, Mr. Chairman.
    Chairman CROW. Thank you, Mr. Balderson. The gentleman 
yields back.
    And if Committee members have an opening statement, I would 
just ask that they be submitted for the record.
    I want to take just take a few minutes to explain the 
timing rules for those of you who have not testified before. 
Each witness gets 5 minutes to testify at the beginning, and 
then member get 5 minutes for questioning. There is a lighting 
system to assist you right in front of you. So, the green light 
comes on when you begin. The yellow light will come on when you 
have 1 minute. And then the red light comes on when your time 
is completed. And we do ask that you try to stick with those 
timing limits so that the members can get questions in and we 
can move the questions around between the witnesses as well.
    So, I would now like to begin by introducing our first 
witness, Dr. John Younger. Dr. Younger is the vice president of 
Science and Technology at the University City Science Center. 
With extensive clinical research and extraimperial experience, 
Dr. Younger is working on the Science Center' s 
Commercialization Startup Investment and Business Acceleration 
Program. Dr. Younger also founded Akadeum--did I get that 
right, Dr. Younger? Close enough. Akadeum Life Sciences, a 
venture-backed life science company out of his lab at the 
University of Michigan and serves on the National Advisory 
Council of the National Institute of General Medical Sciences. 
Welcome, Dr. Younger.
    Our second witness is Dr. Sheila Martin. Dr. Martin is vice 
president for Economic Development and Community Engagement at 
the Association of Public and Land-grant Universities. Dr. 
Martin leads and engages with senior university leaders and 
stakeholders on talent and workforce development, innovation 
and entrepreneurship, and social, cultural, and community 
engagement. She also directs APLU' s Commission on Economic and 
Community Engagement. Dr. Martin earned a B.A. from Southern 
Illinois University, an M.A. from the Patterson School of 
Diplomacy and International Commerce at the University of 
Kentucky, and a Ph.D. from Iowa State University. Welcome, Dr. 
Martin.
    Our third witness today is Dr. Ethan Mann. Dr. Mann is a 
vice president of Sharklet Technologies, an innovative surface 
technology company based in Aurora, Colorado. Dr. Mann has led 
many of Sharklet' s translational scientific studies aimed at 
demonstrating the use of microtextures for biological control. 
Dr. Mann holds a Bachelor of Science from Chadron State 
College, and a Ph.D. from the University of Nebraska. He 
trained as a post-doctoral fellow in infections disease at The 
Ohio State University, which I am sure Congressman Balderson is 
happy to hear. Do not let it go to your head, Troy. Dr. Mann 
currently serves on NIH review panels to evaluate small 
business innovation research grants which support 
commercialization of innovative technologies. Thank you, Dr. 
Mann, for being here today.
    I would like to now yield to our Ranking Member, Mr. 
Balderson, to introduce our final witness.
    Mr. BALDERSON. And just so you know, my deputy chief of 
staff is a graduate of Miami.
    I am turning the reins over. I did not see him come in yet, 
so I am turning it over to the Ranking Member Chabot for the 
introduction.
    Mr. CHABOT. Thank you. Just trying to be part of the 
woodwork over here, Mr. Chairman.
    I want to thank the Chairman and Ranking Member, Mr. 
Balderson, for allowing me to introduce our fourth and final 
witness here today, Dr. Gregory P. Crawford, the 22nd president 
of Miami University, one of the great universities in Ohio. And 
I would note that our staff director, Mr. Kevin Fitzpatrick, is 
a graduate of Miami; as is my son, Randy; as is my younger 
brother, Dave. And so, a great university. Excuse me.
    Aside from being an Ohio native, Dr. Crawford is uniquely 
suited to present on today' s topic. He has bachelor' s degrees 
in mathematics and physics, a master' s degree in physics, and 
a doctorate in chemical physics from Kent State University. His 
work includes more than 400 research and education 
publications, review articles and book chapters. Dr. Crawford 
has an extensive track record of guiding research to 
commercialization. He has participated in spinoff and startup 
companies and is credited with 21 U.S. patents and patent 
applications. Before coming to Miami, he launched research 
commercialization initiatives at Brown University and at Notre 
Dame. He is currently a member of the board of directors at 
Cintrifuse, the incubator and accelerator dedicated to creating 
a stronger technology presence in the Greater Cincinnati area. 
Dr. Crawford' s administration emphasizes diversity, inclusion, 
and interdisciplinary collaboration across all of Miami' s 
campuses and colleges.
    We thank you for joining us today as we do all the 
witnesses on this distinguished panel. I want to thank you for 
your dedication to Miami University and the Greater Cincinnati 
area and the state. Thank you very much, Doctor.
    Chairman CROW. Thank you. The gentleman yields back.
    And the members, we got through our introductions which 
whenever folks from academia come is really the most 
challenging part for us. There are a lot of acronyms here. So, 
thank you for bearing with us.
    So, let' s start with Dr. Younger. You are recognized for 5 
minutes, Doctor.

 STATEMENTS OF DR. JOHN YOUNGER, VICE PRESIDENT OF SCIENCE AND 
TECHNOLOGY, UNIVERSITY CITY SCIENCE CENTER; DR. SHEILA MARTIN, 
     VICE PRESIDENT OF ECONOMIC DEVELOPMENT AND COMMUNITY 
ENGAGEMENT, ASSOCIATION OF PUBLIC AND LAND-GRANT UNIVERSITIES; 
   DR. ETHAN MANN, VICE PRESIDENT OF MARKETING AND BUSINESS 
   DEVELOPMENT, SHARKLET TECHNOLOGIES, INC.; DR. GREGORY P. 
             CRAWFORD, PRESIDENT, MIAMI UNIVERSITY

                 STATEMENT OF DR. JOHN YOUNGER

    Mr. YOUNGER. Great, thank you.
    Chairman Crow, Ranking Member Balderson, and members of the 
Subcommittee, thank you for the opportunity to testify today. 
It is an honor to join my distinguished colleagues on today' s 
panel, and I will suppress my Wolverine access for the rest of 
the morning.
    Before a great idea becomes a business, or creates a 
sustained new job, or generates a dollar of export, it must 
spend time in what you have called the ``valley of death.'' The 
term applies to a period of commercial development in which 
really critical questions have to be answered--does anyone 
actually need the idea that is being put forward? If so, how 
many people actually want it? What are they willing to pay?
    If you have an adverse answer to any of these questions, a 
really great idea can be shown the door very quickly. In most 
instances, that is the appropriate outcome. A lot of ideas turn 
out to be much better on paper than they are in practice.
    The concept of the ``valley of death'' applies to any new 
undertaking but it is really acutely relevant to startups, in 
which there is no predefined market and there is no proven 
business model to draw from. Startups often die on the vine. 
Nobody buys, the intellectual property is not defensible, a 
capable founding team cannot be recruited. That is common and a 
key tenet of startup thinking is that poor ideas should be 
identified as such as quickly as possible and abandoned as 
quickly and efficiently as possible. That saves investment and 
it saves time for the entrepreneurs that are working on that 
ideas to move on to more promising ideas.
    I began my career as a physician scientist and pursued that 
path for 20 years. However, for the last 6 years of my career, 
I have spent a really great time working in the ``valley of 
death,'' first as an entrepreneur of a Michigan-based biotech 
startup, and most recently as part of a team that is doing 
everything possible to make the journey of that valley as 
quick, if not painless, as we can for new ideas and new 
companies.
    I now work at the University City Science Center of the 
Nation' s oldest and largest urban research park, founded in 
1963 and based in Philadelphia. As the Science Center' s vice 
president for Science and Technology, I lead all of our efforts 
to help universities and startups move their technologies 
beyond the valley, including a program that provides grants to 
research universities to better prepare their most promising 
technologies for entry into the world, a portfolio of some of 
the most effective business incubators on the East Coast, and 
an early stage investment fund that provides critical early 
capital to biotech and healthcare IT startups in their most 
vulnerable formative days.
    Our Nation' s economy faces persistent and intensifying 
challenges. Innovation is the key to addressing many of those 
concerns, but how best to support innovation is an especially 
tough nut to crack. There is no question that research funding 
is essential to creating ideas and universities that may become 
great new companies.
    However, I am here today to draw your attention to what 
must happen after those ideas come out of universities as they 
mature through formation, commercialization, job creation, and 
economic impact.
    In 2010, Steve Blank, a seminal thought leader in 
entrepreneurial theory, defined a start-up as an organization 
formed to search for a repeatable and scalable business model. 
Having launched my own startup, I whole-heartedly endorse that 
idea. Startups are not small versions of established 
businesses. They are harsh, marketplace experiments seeking to 
determine if a business idea has legs or not. These experiments 
are risky. They are often heart-breaking. They are typically 
expensive, and in most instances, end up with a decision to 
call it quits. But they are an unavoidable and unblinking 
prerequisite for commercial success.
    The nature of startups suggests that the predominant models 
of Federal support are not really well-suited for these 
endeavors.
    The measured pace of grant submission, review, and award 
operate at a speed that does not match the tempo of intense 
innovation. A startup applying for an SBIR or STTR award 
typically will not see that money for over a year after 
application. In that time, many companies will fold or pivot so 
strongly away from the original plan that even when the SBIR 
arrives, the idea is no longer in alignment with the grant was 
meant to pay for.
    Much like the patent process, the SBIR/STTR mechanism is a 
funding approach that favors teams that have the luxury of 
being able to take things slowly. In my opinion, taking things 
slowly is not part of an effective formula for a national 
innovation strategy.
    Startups do not necessarily need a lot of money; they need 
money right away. It is not practical for the government to 
implement a mechanism to quickly release small amounts of cash. 
Fifty thousand, $100,000 dollars can be transformative. In my 
experience, the best approach instead is to provide funding to 
reliable and proven incubator and accelerator programs and 
organizations, such as the Science Center, which has helped 
over 400 companies launch. These enterprises have boots-on-the-
ground familiarity with the core ingredients that companies 
will need. Who are the talent? Who are the local advisors? What 
is the behavior of local investors? These startups require 
these ideas to move forward, and the companies we help launch 
grow benefit from our decades of experience in this space.
    My sense is that the best practical means of facilitating 
and monetizing the innovation that turns academic research into 
business development is to specifically support the growth of 
private sector organizations that can make rapid, unbiased 
determinations of which early-stage ideas have sufficient 
commercial promise to attract investment. This is a role we 
currently play for BARDA using our multistate tech transfer 
network to identify biotechnology ideas that may be of interest 
to Health and Human Services.
    I am going to--wait, am I past time? All right. I am going 
to give up my negative time and say the rest of my remarks are 
in written comments. Thanks.
    Chairman CROW. All right. Thanks, Dr. Younger.
    Dr. Martin, you are recognized for 5 minutes.

                 STATEMENT OF DR. SHEILA MARTIN

    Ms. MARTIN. Thank you, Chairman Crow, Ranking Member 
Balderson, and members of the Committee. I am grateful to be 
here to testify today. It happens to be National Inventors'
    Day. So Happy National Inventors' Day to all of you.
    The subject of today' s hearing is important to public 
research universities who work with small businesses to improve 
their success in three important ways:
    The first one is talent. The most important form of 
technology transfer happens when businesses hire our graduates. 
When our students participate in federal research grants, they 
benefit by learning about scientific discovery, participating 
in cutting?edge research, and working in teams. And they bring 
that knowledge to the companies that hire them.
    The second way that public research universities work with 
small businesses is through innovation, the discovery that 
generates new products, greater productivity, and entirely new 
industries, while solving important social problems.
    Third, universities are important to improving the quality 
of life in their local communities. They generate prosperous 
economies, offer cultural activities, enrich civic life, and 
partner with local organizations to address important community 
issues. And thriving regions are a magnet for the talent that 
small businesses need to innovate and flourish.
    In thinking about the innovation pipeline, we really have 
to take the long view. We cannot always predict what area of 
basic research will lead to an invention that transforms our 
economy, cures a widespread disease, or allows us to lead more 
fulfilling lives.
    Because the benefits of basic research are so diffuse and 
long term, few private sector companies will fund it. And 
therefore, it makes economic sense that basic research is 
funded by Federal agencies. So, maintaining or increasing that 
Federal basic research funding is essential to ensuring that 
the font of scientific knowledge that feeds the innovation 
pipeline continues to flow.
    University researchers are anxious to see their discoveries 
put into practice by businesses. And they often launch their 
own businesses. But before those ideas reach the market, 
someone has to invest in the engineering, design, and market 
research that is necessary for commercial success.
    That is why programs like SBIR and STTR are so important. 
They provide funding to help companies work through some of the 
more difficult technical risks, evaluate the market potential, 
and take ideas to the point where the private sector is willing 
to invest.
    Public and land-grant universities are important sources of 
both ideas and talent to companies who benefit from SBIRs and 
STTRs. Empirical studies of these programs demonstrate that 
SBIR projects that have a connection to a university are more 
likely to be successful commercially.
    And while there are many examples of companies that have 
successfully used an SBIR grant to commercialize a university 
technology, I will highlight just two here and there are many 
more provided in my testimony.
    The first I will talk about is Solid Power. It is a 
Louisville, Colorado company that spun out of the University of 
Colorado at Boulder and is developing solid state battery 
technology for the electric vehicle market. Its SBIR awards 
have led to successful funding by strategic investors. And so, 
these Federal investments have not only helped us make progress 
in clean mobility technology but also have spurred success for 
this small company.
    The second is Core Quantum Technologies, a Columbus, Ohio 
firm that developed a method for speeding diagnoses and 
identification of cancer treatment options. The company' s 
founder is Professor Jessica Winter from The Ohio State 
University' s College of Engineering. She benefitted from Ohio 
State' s NSF-funded Advance Program which develops the 
entrepreneurial capacity of women faculty. It helped her start 
her company, win the SBIR grant, and connect to additional 
investors. And that project also illustrates the importance of 
programs that diversify STEM fields and provide resources for 
women, minority, and student entrepeneurs so that they, too, 
can be successful with SBIR and with their companies.
    Because as great as they are, SBIR and STTR are not enough. 
Funding for basic research and complimentary programs, like NIH 
Reach, NSF I-Corps, EDA' s Regional Innovation Strategies, and 
NIST' s MEP partnership are also important for successful small 
businesses.
    APLU and its member universities are grateful for the 
Committee' s support for these programs. To see for yourself 
how our universities are supporting the universities' small 
business innovation pipeline, I invite all of you to meet 
inventors at the Innovation and Entrepreneurship Showcase, 
sponsored jointly by APLU and the Association of American
    Universities, on April 28 at 5 PM here in the Rayburn 
Cafeteria. I look forward to seeing you there.
    Chairman CROW. Thank you, Dr. Martin.
    Dr. Mann, you are recognized for 5 minutes.

                  STATEMENT OF DR. ETHAN MANN

    Mr. MANN. Thank you for inviting me. It is truly an honor 
to be here.
    I want to talk a little bit about Sharklet Technologies, 
which has been a recipient of several SBIR awards over the 
years. Sharklet is a startup company based in Aurora, Colorado, 
developing novel surface textures applied to consumer and 
medical products to prevent the spread of germs that cause 
infections. The novel paradigm-shifting concept was the 
brainchild of Dr. Anthony Brennan, a professor of Engineering 
at the University of Florida in Gainesville. Dr. Brennan 
noticed that tiny surface structures impact biological response 
of cells, like bacteria. He noticed also that sharks are not 
susceptible to fouling like whales, manatees, and sea turtles. 
When he studied shark skin, he noticed that that specific 
texture is responsible for preventing fouling, and when 
reproduced on plastic surfaces, it is able to prevent the 
accumulation of bacteria.
    Sharklet has been developing numerous applications for this 
technology now based in Colorado ever since Dr. Brennan' s 
original discovery.
    Developing novel innovations for market readiness requires 
significant investment regardless of the sector involved. 
Science Direct reports that medical device development requires 
about 7 years to go from concept to commercialization, and 
costs more than $31 million. Biomedical technologies require 
substantial safety and efficacy testing, usually to the 
molecular level, to satisfy regulatory approvals. Other 
advanced industry fields are similar due to the intricacies of 
the technology. Manufacturing and development steps are 
completed with the utmost scrutiny to ensure consistency and 
safety of the products used by customers.
    Innovations with high likelihood of success are those that 
have been de-risked to the point where certainty of value 
surpasses the risk of failure for these new ventures. More 
quickly, driving technologies to this value inflection step 
should be the step of technology transfer offices around the 
country. Activity of these offices is critically important to 
ensure taxpayers are allowed to benefit from the technologies 
they have had a part in funding.
    Offices of technology licensing should be appropriately 
resourced to support the quantities of emerging innovations 
that are in our amazing universities.
    Resources may need to be expanded to track with the fast 
pace of science occurring in these academic research centers. 
Perhaps one of the best examples to support de-risking 
innovations is the SBIR and STTR grant programs which serve to 
fund proof of concept and early R&D activities for these 
innovations. Small businesses taking advantage of these 
mechanisms are at a distinct advantage. They have improved 
their technology and added value without selling equity which 
dilutes investors.
    Delivering technologies to the marketplace provides a value 
beyond the obvious use of the technology. Supporting small 
businesses and innovation fuels entire community growth. For 
example, the life science industry in Colorado in my home state 
has been invaluable for the state's economy. The life sciences 
industry provides more than 30,000 high-paying jobs with an 
average annual salary of more than $89,000. Moreover, these 
direct jobs lead to estimated indirect jobs of about 92,700.
    I sit on the board of directors for the Colorado Bioscience 
Association, CBSA. CBSA is a state organization that creates 
co-opportunity for the Colorado life sciences community. CBSA 
champions a collaborative life sciences ecosystem and advocates 
for a supportive business climate.
    Workforce collaboration is key to the growth and maturation 
of any industry. CBSA and the life science industry together 
work to cultivate a strong life sciences talent pipeline in 
Colorado with several different workforce development and 
skilled training programs including various interactive 
educational experiences, mentoring, internships, and workforce 
skill building.
    And Colorado life sciences companies see the value of 
engaging not only in K-12 but in higher deduction. In fact, 
Sharklet Technologies, for example, engaged with CSU, Colorado 
State University, biomedical engineering students each of the 
last 4 years to complete a senior design project as part of 
their senior-level course work. These projects included core 
components to the Sharklet product development activities.
    Support from the Committee on Small Businesses and the 
Subcommittee on Innovation and Workforce Development is 
critical to reduce barriers and ease the ability to bring 
technologies to life.
    Chairman CROW. Thank you, Dr. Mann. I just love that 
Colorado is leading the way on shark-based technologies.
    Dr. Crawford, you are recognized for 5 minutes.

              STATEMENT OF DR. GREGORY P. CRAWFORD

    Mr. CRAWFORD. Good morning, Chairman Crow, Ranking Member 
Balderson, and Committee members. I truly appreciate the 
opportunity to testify in front of the Committee today.
    Today, I wish to answer how universities and small town 
American and rural America can create a vibrant economy based 
on innovation, creativity, and entrepreneurship.
    I wish to make three points today.
    First, pulling in innovation that you do not necessarily 
have to grow it at home, but you can pull it into your 
institution.
    Second, educating innovators for innovation. How technology 
acceleration and the global world today requires a new set of 
skills for our students.
    And three, keeping innovators and innovation at home. How 
do we attract talented graduates to stay in small town America 
and work at small companies to create vibrant communities?
    Number one. Pulling innovation into our ecosystem. 
Oftentimes, universities use a push strategy. They invent, they 
patent, and they try to push it out through a startup company 
and/or license it to a big co. We also do that, but we have 
also started a new kind of process and we call it the pull 
strategy. And pull strategy means that we go to our partners 
and we pull in patents into our ecosystem and then develop them 
with our students, faculty, and staff.
    And so, two examples there: We work with Wright-Patterson 
Air Force Base in Dayton, Ohio, and they have over 1,000 
patents for defense-oriented applications, and we have access 
to that portfolio to try to find commercial applications for 
their use.
    And second, we work with companies. And so, there may be an 
idle technology that may just be too small for a company 
developer, not on their critical path but then they decide to 
push it our way. We will pull it into our ecosystem and develop 
it, which is great for a small, entrepreneurial company. 
Entrepreneurship is about shots on goal and pulling these 
patents into our ecosystem is a way in which we can accomplish 
that.
    And three, in the great state of Ohio--got to put a plug in 
there--but working with Lieutenant Governor Husted and also all 
the Ohio public universities, we just created an IP promise in 
Ohio which is a really simple way for companies and 
universities to work together with a very simple agreement and 
a very simple technology transfer contract.
    Second, educating innovators for innovation. Jobs today are 
not blue collar or white collar, but they are new collar jobs. 
Industry 4.0 and artificial intelligence is driving change all 
across our industries from biomedicine to advanced 
manufacturing the materials to climate and the environment. And 
how do we train students in this new area? Well, one is to 
train them in humanics or humanics, however you want to call 
it. And it is the convergence of learning a little bit of 
science and technology, the quantitative aspects, statistics 
and mathematics, but also the humanities. And pulling those all 
together makes somebody actually very robot-proof. I always get 
asked, how do you make sure your students are robot-proof in 
this new world? And I say, the best way to do that is to be 
good at being human first.
    And second of all, we want to educate in entrepreneurship. 
We want students to deal with ambiguity. We want students to 
fail and to use that steppingstone to pivot to something 
successful. And we do that through many different avenues with 
business plan competitions and a top entrepreneurship institute 
in the country. But more importantly, we also put students and 
they spend a semester in Silicon Valley where they work at the 
most innovative companies in the world and also take courses 
out there. And we also have a specific internship program for 
students to work at small startup companies, not just the big 
cos.
    And third, experiential learning. We just started something 
I am very excited about. It is called the Work Plus program. 
But we place students in our local companies, and they work 24 
hours a week. They get a salary. Then, that company actually 
pays off their tuition. It is a debt-free education. And one 
example is Thyssenkrupp Bilstein, company in our area which 
makes shock absorbers, and our students are working in their 
industry 4.0 robotics laboratory.
    And third, keeping innovators at home. Small and rural 
towns need talent to live, work, play, and enjoy, to build 
these powerful small towns in America. People and ideas are the 
key to these thriving small towns.
    A couple of things that we are doing as we looked at the 
Department of Ag' s report by Wojan, and to attract that talent 
to small towns, innovation and creativity was important so the 
arts was just equally as important as the technology side. So, 
with Oxford, Ohio, we work together, and we have a space that 
we use jointly where we have creatives come in. It is called 
our Center for the Arts. And the second floor and third floors 
have spaces for photographers, architects, artists, musicians, 
and sculptures, and these sole proprietors actually add to our 
local economy.
    And the next phase of that is taking a second building on 
that same block and moving towards putting our technologists 
and innovators in there so that we truly combine an innovation 
block in small town Oxford, Ohio, which pulls together both the 
creatives and the technologists in one space and one place.
    And I am so happy to have joining with me today our 
assistant city manager, Jessica Greene.
    That concludes my comments.
    Chairman CROW. Thank you, Dr. Crawford. As a wayward 
liberal arts major, I share your passion for the humanities, 
so.
    I am going to begin by recognizing myself for 5 minutes. 
And I appreciate the opening statements from all of you.
    Let me begin by a comment that Dr. Younger, you had made 
about the difference between accelerators and incubators and 
just direct SBIR/STTR funding and some of the kind of vetting 
role that some of those kinds of intermediary organizations 
might play. And I would like to hear from all four of you.
    Is it your view that more of the funding and more of the 
support should go to kind of some of these intermediate 
incubators and accelerators on the ground as opposed to kind of 
direct funding directly to companies and that would be more 
helpful for folks? Or is there kind of a middle ground here?
    Let' s start with Dr. Younger.
    Mr. YOUNGER. It is a great question. So, the question at 
hand is how do you make that money as rapidly deployable and as 
accountable as possible; right? You want the money to succeed. 
And for better or for worse, startups are local endeavors. You 
can attempt to be global, but your advisors are likely local. 
Your first investors are probably going to want to visit you on 
a frequent basis. They are not going to be a world away. And so 
being able to put resources right at the spot where the company 
is starting, I think is really key because everything is going 
to happen locally, at least in the first 6 months to a year. 
The role that we play is that we have the ability of knowing 
pretty much all the facts on the ground. Who is active? Who is 
doing what? Who do these people need to connect with? And that 
is something that the study sections for SBIRs/STTRs just do 
not have at their fingertips. And their ability to evaluate the 
novelty of the technology is unquestioned, but their ability to 
sort of very effectively and wisely put the money to play 
quickly is limited. And that is just the nature of the beast. 
So, I think that there is actually a role for using incubators, 
not as an alternate sort of recipient of the money but as the 
decider for how that money is going to get deployed most 
effectively. And that is the way that I would frame it.
    Ms. MARTIN. I think the important thing to remember in this 
is that each of these places needs to build a complete 
innovation and entrepreneurship ecosystem. And we all have a 
different role to play in that. And each of those pieces needs 
to be strong. And so, I think the answer to that question 
probably varies depending on where you are and where that 
ecosystem is strong and where it might have some weak points. 
Certainly, capital is a challenge for many different companies 
and many different stages of the development of those 
companies. So, you know, it is important to remember that we do 
need to continue to fund basic research to make sure we have 
the basis for those discoveries. Capital and mentorship and, 
you know, the incubators and accelerators are all very 
important, but I think the answer really depends on where you 
are and where the strengths and pain points are.
    Mr. MANN. I think the incubators around the country really 
serve as the support structure for a lot of the ecosystems that 
these small companies exist in. I know in Colorado there is a 
number of incubator-type facilities. Sharklet has been located 
in the Fitzsimmons Innovation Campus for a period of time now 
and really have developed strong relationships with mentors on 
an unofficial basis, but also with the staff at the incubator 
facility. So, I think there is a case to be made for sharing 
funding with the incubator facilities to be able to leverage 
some of those assets that are kind of company agnostic and be 
able to kind of rapidly deploy those systems. But I agree in 
some cases the companies themselves have made the case for what 
they are doing and could quickly utilize those funds as well. 
So, I would agree that at times the answer is kind of both, but 
there are circumstances where those can be identified.
    Mr. CRAWFORD. Thank you. I agree with those statements that 
we should put dollars into the incubators and accelerators and 
greenhouses and so forth. I just do believe in that principle 
of subsidiarity, getting the resources down on the ground where 
those folks can make those decisions that know that area the 
best. But more importantly, I think when you put dollars there, 
really look for that co-investment. And if those dollars are 
highly leveraged with angel investors, venture capitalists, and 
other city and state constituencies and so forth so you get the 
most bang for your buck so to speak.
    Chairman CROW. Thank you.
    I am going to end my time here and then I will recognize 
the filling in Ranking Member, Mr. Hern, for 5 minutes.
    Mr. HERN. I would like to thank the Chairman. I would like 
to thank the witnesses for being here today.
    As an engineer and a small business owner, former small 
business owner for 35 years, I certainly understand the value 
of our research universities we have around the country and how 
valuable they are to small business.
    With the localities across the United States constantly 
evolving their policies to create environments that are 
conducive to small business growth, research universities help 
to serve as a significant resource for small businesses looking 
to capitalize on technological and entrepreneurial knowledge. 
This is why I am glad to have such great research universities, 
not only in our district but in our state, University of Tulsa, 
Oklahoma State University, and University of Oklahoma. These 
universities are assets to Oklahomans, and I believe it is our 
job in this Committee to help universities like these to 
continue to have these types of relationships with small local 
business owners.
    As a part of this, I think it is necessary for members of 
this Committee to try to work, and we do this a lot, work in a 
very bipartisan way to reduce the onerous regulatory burdens 
which have been placed on these institutions. This is something 
that I would like to spend the remaining amount of my time to 
ask each of you to elaborate, what are the most significant 
regulatory and administrative requirements of federally-funded 
research programs, and what do you think--let' s talk about 
that. So, if we could just go through, and maybe think in your 
mind about what some of those solutions might be as we go 
through.
    Dr. Crawford, we will start with you and come this way.
    Mr. CRAWFORD. What I wanted to mention about that is one of 
the areas, you know, I have also started a couple of companies 
based on my inventions, and so I saw it from the side of being 
a professor and trying to struggle to get the intellectual 
property out of the university. And then as a leadership role, 
actually trying to make it a little bit more conducive to great 
cooperation.
    One of the areas that you see with small businesses and 
companies and so forth is just the complexity of the contracts 
and so forth that have to kind of take place to get that 
relationship developed. And I am going to kind of embellish a 
little bit here but there will be a stack of papers that you 
put down on the company and here at the university and they are 
like, this is the contract.
    Well, what we did in Ohio is we wanted to kind of crunch 
that sort of piece down into something that was reasonable, a 
page or two, so that we could create these kinds of agreements. 
And so, when there was an interest and an idea coming out of a 
university, a research project, that we could move on it much 
quicker. We were not negotiating over something that may or may 
not happen in the future, but we actually agreed to moving it 
forward today and then coming back to the table when that was 
successful. And so I think from that perspective of always 
having sort of something simple and that is easy to understand 
and moving forward that you can actually pull together the 
company and the university and get things off the ground much 
quicker than I think we ever could in the past.
    Mr. HERN. Thank you.
    Dr. Mann?
    Mr. MANN. Yeah. I think your point is well brought. I think 
that certainly as a small company is starting off and licensing 
and technology or developing and technology, they have to think 
not only in that short window but they have to think, you know, 
10 years down the road when they are trying to exit to a 
strategic or disclose things publicly. So, all of the 
agreements have to accommodate that.
    I would take, maybe as an example, something like the Bayh-
Dole Act has provisions in it that are extremely ambiguous that 
are challenging for even legal counsel with a small business to 
be able to understand some of the restrictions associated with 
how the use of Federal funding and productization occurs. And 
so just simple ambiguity can lead to stacks of legal agreements 
where you have to be able to decide around how you are going to 
handle ambiguity.
    So, from a simplistic sense, perhaps even looking at the 
current regulations and providing more detail for what is 
trying to be accomplished could be dramatically impactful for 
small businesses.
    Mr. HERN. Thank you.
    Dr. Martin?
    Ms. MARTIN. Thank you, Congressman Hern.
    I would just say that developing patents is very expensive, 
and it is really important that our institutions be able to 
defend those patents in court. And so, I will follow up with 
you in writing on other aspects of the regulatory system that 
our institutions might need some relief with. But I would just 
like to mention that it is very important that companies be 
able to defend their patents in court because not only is it 
expensive, but getting a patent also makes it much more likely 
that that company will be successful in getting venture 
capital.
    Mr. HERN. Thank you.
    Dr. Younger, I am sorry, but I have got to close out here. 
But I just want to take your thoughts, and I know you have got 
great thoughts there, and encapsulate those in this Committee 
as we go forward and looking at how we continue to do what I 
like to say is, you know, when I ran for this office, was to 
get government out of the way so we can help entrepeneurs 
create jobs and put Americans to work. I have said that 
statement so many times and this is a classic example of people 
who are right in the fray, especially when you have been on 
both sides of this you know exactly what to do. And so I have 
also been one to claim that a lot of people talk about a lot of 
things in Congress they know nothing about, so it is always 
refreshing to come to this Committee because we always have 
great witnesses that are either nonpartisan or bipartisan in 
what they are trying to get accomplished. So, thank you so much 
for being here.
    And Mr. Chairman, I yield back.
    Chairman CROW. Thank you, Mr. Hern. Appreciate your 
comments and questions.
    So now the gentleman from New Jersey, Mr. Kim, who is also 
the Chairman of the Subcommittee on Economic Growth, Tax, and 
Capital access is recognized for 5 minutes.
    Mr. KIM. Thank you, Chairman. I am really glad we have an 
opportunity to talk about this issue. I represent a district in 
South Jersey and the Shore, Burlington County, Ocean County, 
about 120,000 small businesses in that area. And I am trying to 
think about not just where my district is tomorrow or next year 
but what do we think our district is going to look like 20, 30 
years from now when my kids are adults, and what is it going to 
look like at that point? So, I am trying to piece this 
together. We have some great assets. We have a joint military 
base on the district, a lot of innovation happening there and 
other things. But we do not necessarily have sort of a top 
research university. And I guess some of my thinking is, you 
know, Dr. Younger, you are right across the bridge from us, so 
you are maybe familiar with our area. I guess what I am trying 
to get a sense of is I have a deep respect for the work that 
your organization does, the partnerships that your 
organizations have with the universities. What about places 
that are more suburban and rural? I think Dr. Crawford, you 
kind of got to some of this. But I am trying to think about 
this. Is that model Dr. Younger of what your organization is 
doing, how can that be replicated, or should it be replicated 
in places that might not have a top research-type university? 
Are there examples of how this partnership has happened with 
community colleges or other types of examples? I would just 
love to get your thoughts on that.
    Mr. YOUNGER. That is a great question.
    So, for the record, the Science Center now has 
relationships with four out of five research institutions in 
New Jersey, and we love working with them. There is quite a 
spectrum of talent there. So, I think that some of these issues 
come down to sort of population density. How many people are 
around to come up with new ideas? How many people are there to 
work in new companies? How many people around that potentially 
serve in the capacity of angel investors?
    But I think that in the end I do not believe that a 
research university is absolutely a requirement for making 
something remarkable happen. And I think the Miami example is 
just right. I grew up in a little town in Missouri. Things can 
be innovative in lots of different places. I think what you 
need is you need local champions. So, you need folks who are 
really going to stand up and try to make something happen. You 
need imaginative capital that can come in from potentially a 
farther distance than you would otherwise expect that can make 
the trip and come in and try to support things. And you need 
founders who can have a pretty broad sense of sort of what 
region are they in. Right? So, am I in Cape May or am I on the 
East Coast; right? And that is a mindset that really matters, 
that makes a difference. But I do not really think that there 
is any reason to believe that--institution is required for 
something remarkable to happen. I think things can happen in 
lots of different capacities if you have the right resources.
    Mr. KIM. Well, I certainly hope so. And our district, 
certainly a lot of innovation going on there but I think, you 
know, some of the points you mentioned about the local 
champions, the founders, a lot of it also comes down to just, 
you know, the sheer infrastructure, ensuring that we have the 
broadband infrastructure and the other types of just sheer 
capacity components.
    Dr. Crawford, I would not mind getting some of your further 
thoughts on this type of approach.
    Mr. CRAWFORD. That is actually a great question, and I grew 
up on the track of, you know, Ph.D. programs, post-docs, 
inventing things, patents and spinning things out of the 
university. But as I have been in this career now for over 25 
years in academics and seeing what is happening today, you 
know, it is quite interesting because it is not necessarily the 
sole property of graduate students, faculty, and post-docs 
anymore. But we are seeing undergraduates come in because they 
can do an app. They can do coding. They can do all kinds of 
great things. And I think if you put more emphasis on looking 
at some of that talent, they are younger in their career, of 
course, but they can just do some spectacular things. It may 
not be a farmer or the billion-dollar molecule, but it can be 
some great, neat things going on.
    And we are doing it in Ohio to building up a network of 
universities and putting their entrepreneurship centers 
together. We are on our path for doing that. And I do think 
that one of the things that we should all be thinking of, too, 
is just going down in that pipeline of the training of 
undergraduates, also going into the high schools, because some 
may not go to college and some may become plumbers or 
electricians or what have it, but the entrepreneurial skillset 
is going to be very important to them. So, trying to figure out 
ways which you can train high school students and making sure 
your local community colleges and local undergraduate 
institutions can also play a role in this very vibrant and 
accelerating economy.
    Mr. KIM. I think that is right. I mean, look, we pride 
ourselves in New Jersey for having top public schools, K-12, 
and having developed that kind of workforce, but we also see 
such an exodus of that young talent going to other places. And 
I think for me, I am really trying to get to this understanding 
that, you know, innovation is what you do, not where you do it. 
And how do we then try to have that sense of spreading that out 
and not just further, you know, siloing our society in terms of 
where innovation and that type of technology can be done. So, I 
appreciate your thoughts.
    Chairman, I yield back.
    Chairman CROW. The gentleman yields back.
    I now recognize the gentleman from Pennsylvania, Dr. Joyce, 
for 5 minutes.
    Mr. JOYCE. Thank you, Mr. Chairman.
    What a great presentation you have brought to the table 
today.
    Dr. Younger, I, too, come from a medical background, and 
having trained at Temple University School of Medicine, my wife 
at Drexel University School of Medicine. And I find it really 
fascinating that you are here today with a background in 
emergency medicine and talking from the city with an incredible 
history in medicine. And bringing that forward into these 
discussions. You and I recognize that Pennsylvania has more 
medical schools than any state in the union. And with the 
addition of another medical school in 2022 at Duquesne in 
Pittsburgh, that will even be further expanded.
    Would you please comment on the importance of you setting 
up a program in West Philadelphia, really in the hub of medical 
science in the northeast?
    Mr. YOUNGER. Sure. So, Philadelphia is remarkable. 
Pennsylvania is remarkable. I just got back from Pittsburgh. It 
is a remarkable commonwealth.
    I think that we are trying to do some heavy lifting; right? 
We are trying to do some difficult things. There is amazing 
technology. There are diseases that will be gone in my career 
that are going to come out of West Philadelphia. There is no 
question about that. Treatments are going to be just 
remarkable.
    We are trying to find out how do we take this idea forward? 
There is a traditional model. The Science Center is trying to 
innovate at the same time that we are trying to support people. 
We are in some ways a startup like a lot of our startups are in 
trying to figure out what is the best path to try to make some 
of these things happen? I spend a lot of my day in that regard.
    I think if there was one thing I could do to the physicians 
in Pennsylvania, the physicians, the academic scientists 
everywhere, is I would look for a way to lower the boundary by 
which someone can do what I did, which is to do the math and 
say I am going to be okay leaving the university to go try to 
launch an idea. The math is very much against that move; right? 
Having a tenured position. Having a clinical practice. There is 
hardly any reason to go innovate because you are pretty well 
taken care of. And I think that if there is one thing this 
Subcommittee can do is to look at existing policies and 
regulations and say how can we make it so that that balance is 
a little bit more in favor of people taking a shot as opposed 
to staying in their sort of usual position. And I think I have 
some great ideas I can follow up on that but I think that one 
of the things that we are trying to do is there is a lot of 
talent sitting in universities that is most comfortable there 
but that might be most impactful outside. And I would love to 
think about ways in which simple things could be implemented to 
allow people to take a shot coming out of university to try to 
make a remarkable thing happen.
    Mr. JOYCE. Do you think your background, the presence of a 
strong science base allows for innovation in a different line 
than we might traditionally see in engineering or in math?
    Mr. YOUNGER. Perhaps. I guess the proof of the pudding is 
in the eating. We will see. I think I have a fairly broad 
technical background and so I think I try to put my skills to 
use wherever I can. But I think clearly just physicians, just 
engineers, just physicists, that is not enough. I think the 
crossover is where amazing things happen, and it requires 
people to be relatively flexible in how they define their 
backgrounds.
    Mr. JOYCE. What can we see in students in training these 
days? What can we expect? How can we raise that bar so that the 
students that you work with, the innovators that we will see 
tomorrow, how can they be better prepared?
    Mr. YOUNGER. So I think two things. One was alluded to here 
before which is just embracing ambiguity; right? Being able to 
work in very uncertain circumstances is a great skill. Frankly, 
just personally I will say that numeracy matters, and we train 
a lot of folks in a lot of skills but just being able to 
quantitatively think about problems I think is something that 
always needs sort of reemphasis. But I think those two points 
would be the ones that I would say deserve a lot of respect.
    Mr. JOYCE. Thank you.
    I yield the rest of my time.
    Chairman CROW. Thank you. The gentleman yields back.
    I will now recognize the gentlelady from Pennsylvania, who 
is no stranger to entrepreneurship and starting and growing 
businesses, is now recognized for 5 minutes.
    Ms. HOULAHAN. Thank you. And I am really appreciative, Dr. 
Joyce, of your conversation as well. Philly is where it is 
definitely happening. And I am from just outside of 
Philadelphia as well and I am going to carry on with your line 
of questioning as well as with Mr. Kim' s line of questioning 
because I have been struck by in the couple years that I have 
been running for Congress and now the one that I have been here 
how many people I meet who say, oh, yeah, I am from 
Philadelphia, or yeah, I am from Pittsburgh, but yet they are 
not there anymore. And I really want to figure out not just for 
my community, for Philadelphia, for Pennsylvania, and for 
Pittsburgh, why that is happening but also for places all over 
our country where people are going to places like the Silicon 
Valley or like Boston with the talent that they have learned 
and gained from places like Pittsburgh and places like 
Philadelphia because there is definitely a brain drain going on 
and I am trying to figure out as an entrepreneur who came to 
Philly and stayed in Philly, you know, how do we make that 
happen more?
    And so, I would like to dig in a little bit more on what 
Dr. Joyce was asking, which is how do you incentivize people to 
take their shot?
    I was very, very fortunate because I had a ROTC scholarship 
and then I had a research assistantship first at Stanford and 
then at MIT. I ended up coming out with no debt from both of 
those experiences, and that allowed me to take chances and 
allowed me to take a shot at being entrepreneurial. And I just 
wonder if you could dig a little bit deeper, first Dr. Younger 
and then anybody else who would like to answer, what can we do 
to provide more incentive for people to not be scared?
    Mr. YOUNGER. So I think it is mostly leading by example; 
right? I think that it is a process that takes time. You need 
to have some local success. There need to be some high 
visibility successes. And I think that you need to have the 
ability of folks who understand that going into an early stage 
company is a career path that actually counts.
    I am a very big proponent of having greater influence of 
business, but frankly, small business in really sort of core 
university processes, like when a training grant is under 
evaluation at the NIH, should there be folks who represent more 
of an industrial perspective looking at the science and the 
training programs? So, if we are going to be training people to 
go into biotechnology companies or go into engineering 
technology companies, should there be company representation in 
evaluating what those training programs look like? I think it 
is a great question, and if you make small changes to the 
curriculum, then these decisions to go into early stage 
companies become much more reflexive. It just seems like a 
natural thing to do because your training curriculum has 
focused on this idea of how to innovate and how to move quickly 
into a new idea.
    So, I think that there are processes that go all the way 
back to make students more comfortable in making a decision to 
do something fairly risky right out of the gate. So, I think 
that is certainly part of it. But then once they are out, how 
do you prevent local brain drain? That is outside of my 
wheelhouse. I will not make much of a shot at that except to 
say I think examples count; right? And once you can stand up 
someone, you know, if you can sit down and have coffee with 
someone who has pulled it off, then it looks like something 
that can exist and then you can move on.
    Ms. HOULAHAN. So I say this a lot as a woman and as a STEM 
professional, you cannot be what you cannot see. If nobody is 
there that you can see, and you cannot look at success then it 
makes it pretty easy for you to go somewhere else.
    And I am interested in also Dr. Crawford, you know, what 
role do universities play in trying to create those centers of 
gravity and trying to capture people' s minds and attention so 
that they stay?
    Mr. CRAWFORD. That is a great question. I know our 
graduates, they are pretty enthusiastic, and they want to go to 
the right and left coast, or they want to go to Austin, Texas, 
or Chicago, Illinois. And we obviously would love to keep them 
in Oxford. And I do think that ag report that I mentioned in 
the beginning by Wojan about bringing the creativity, creatives 
together along with the technologists can actually build more 
of a vibrant community around small towns rural America where 
you can actually keep and attract that talent to kind of stay 
locally.
    I do think also following up on the other remarks, it is 
important, I think, for us to see that you can be an 
entrepreneur early on in people' s thinking. I think in some 
cases, by the time you go through graduate school--
undergraduate, grad school, you may go to medical school or 
whatever--you are already thinking about how to pay off your 
debt and how to do all these different things. And you have a 
car and a house and so forth but that seed early on in the 
education is great. And I think there is no better experience 
than an entrepreneurial experience as an undergraduate where 
you get in there and you can fail a bunch of times and nothing 
matters and you have all the support of professors around you. 
And so, I think the more that we can offer those experiences it 
will get that mindset going so that when they do graduate, they 
will think about something on more of a startup rather than the 
status quo.
    Ms. HOULAHAN. Yeah. And I only have 7 seconds. I just want 
to emphasize the importance of it is easy to create 
opportunities to dream, but if you do not provide places and 
pathways for the people to do that and also the freedom to be 
able to dream where you are not burdened by so much debt that 
you cannot make good choices, we need to work on that, and I 
would look forward to working with our Small Business Committee 
on those particular issues as well.
    I yield back.
    Chairman CROW. Thank you. The gentlelady yields back.
    And now I recognize the gentleman from Tennessee, whose own 
experience starting and running businesses adds a lot to the 
depth of this Subcommittee as well. Mr. Burchett, you are 
recognized for 5 minutes.
    Mr. BURCHETT. Thank you, Mr. Chairman. I think my business 
knowledge is sort of like my stock knowledge. If you see me 
invest in something, do not or short it and then you will come 
out on top.
    I want to thank you all so much. And Mr. Ranking Member, 
who really is not the Ranking Member but is sitting in the 
chair, thank you for your hard work.
    And this is the part where I praise the Chairman for our 
bipartisan work on our two bills, but I will just sort of leave 
that up to the historians to figure out what those two bills 
are because their names are very long. But I do appreciate you, 
brother. We work very close on them and dealing with 
technology.
    I have questions for the panel. I will just kind of throw 
it out there. And I appreciate academia. My parents were 
lifelong educators. Have a degree in education, and so I 
appreciate all the research and things that you all have been a 
part of.
    What are the biggest barriers to technology transfer from 
Federally funded laboratories and universities to the private 
sector?
    This is totally off the record, so just go ahead and speak 
your mind.
    Ms. MARTIN. Thank you, Congressman.
    I would say that first of all, developing intellectual 
property is very expensive. And many of our universities are 
under resourced in their technology transfer offices. Of all of 
the ideas that are disclosed to universities every year, only a 
small fraction of them are developed because this process is so 
expensive. So that is one barrier.
    The second, of course, is the capital that is not always 
available in order to develop those technologies into 
commercializable ideas. And certainly, programs like SBIR and 
STTR are important for that early stage funding when the 
private sector is not yet willing to invest because it is too 
risky. But there is also capital that is needed before a small 
business is formed and so it is not yet eligible for SBIR. So 
what they call phase zero programs, like the NIH Reach program 
are also important because it helps the faculty develop the 
technology a little bit more to the point where they are able 
to form a small business and apply for an SBIR and STTR 
program.
    So, as I mentioned earlier, these complementary programs to 
SBIR and STTR are also important, as well as continuing to fund 
our basic research.
    Mr. MANN. Yeah, I think to that I would just add, you know, 
as someone who has dealt with license agreements that were put 
together 10 years ago and probably had 10 or 12 amendments, 
maybe more than one a year, and looked at licensing additional 
technologies, I think one of the components that you deal with 
in a technology transfer or licensing office is that those 
offices are not aligned with the same levels of success as what 
the small businesses, meaning that those offices are 
essentially protecting a political capital by making sure that 
they do not miss an opportunity on some unicorn; right? So, 
nobody wants the Gatorade story. So then when you go through a 
licensing conversation with somebody, it is very challenging to 
be able to get broad terms that are going to be supportive of 
raising capital and developing a technology, and not 
necessarily knowing where you are going to end up but that you 
are going to end up somewhere valuable.
    And so, I think that maybe merging what a technology 
transfer office' s interest is would be critical. And perhaps 
part of the way to do that is their resources are so 
restrictive that they only get to pick a few winners a year. 
So, they do not want to miss, so they have got to pick what is 
going to be the Gatorade. What do I not want to miss, is what 
is going to be some billion-dollar unicorn? Because if it comes 
out that we passed on some unicorn, you know, then we are in 
real trouble.
    Mr. YOUNGER. Yeah, I would just add, I cannot say that 
better. I think the reason why university is pursuing 
intellectual property is different than the way a small 
business pursues intellectual property. The small business is 
having that intellectual property pulled by market forces. The 
university is pushing that intellectual property to protect 
sort of academic assets. Both of them are legitimate behaviors 
but they are just very different. And so that is why I think 
you see an accumulation of IP in universities where you would 
never see that kind of accumulation of unused IP inside of a 
business.
    Mr. BURCHETT. All right. My wife is very supportive of me 
and my crazy inventions. She always says, baby, I am sure 
somebody laughed at the pool noodle. You know, if you have got 
a pool, you have got a pool noodle. And they cost like 6 bucks, 
and I am sure they were probably just some insulation on a pipe 
somewhere and somebody took one home, some plumber and their 
kid was swimming around in a pool somewhere. So, there you go.
    What is the best way to measure the economic impact of 
university R&D? Is there a way to do it? I get aggravated 
sometimes, and I am running out of time and I have got a great 
story, but I will tell it later. You can read it in my book. 
But go ahead one of you all quickly.
    Chairman CROW. Yeah, I will extend. I will extend for a few 
minutes so you can answer the question.
    Mr. BURCHETT. Thank you, Mr. Chairman. I appreciate your 
effort at bipartisanship.
    Should I tell my story now or should they read it in my 
book?
    Chairman CROW. I am not going to extend it for the story, 
but I will extend it for the answers.
    Mr. BURCHETT. Okay. All right. Well played, Mr. Chairman. 
Well played. And I appreciate the cameraman occasionally taking 
the camera of me because my nose was really itching back there 
and I could not scratch it because, you know. Go ahead.
    Ms. MARTIN. Well, that is a tough act to follow.
    I would just say that the long-term impact of university 
R&D is a very difficult thing to measure. In fact, I was asked 
once if I would do that for my dissertation and I said I will 
move on to the next subject now, please.
    You need to look at long-term growth of industries. There 
are entire industries that have grown from university R&D. The 
most recent winner of the Nobel Prize in Chemistry developed 
the lithium ion battery that we are all carrying around in our 
pocket. And you do not always know where that impact will be. 
And so, it is a very difficult nut to crack. We try to do it; 
the Association of University Technology Managers has some 
measures that we can track that are useful metrics. But you 
have to look at the whole equation and how universities and the 
companies that they spin off affects their communities in the 
long run.
    Mr. BURCHETT. Thank you, Mr. Chairman.
    Chairman CROW. Thank you. The gentleman' s time has 
expired.
    So, I am going to thank all the witnesses for coming in and 
taking time away from your busy schedules to share all your 
experience and your knowledge with us. I think this is one of 
the most bipartisan Committees in Congress as a matter of fact. 
We pride ourselves on that because these are not political 
issues; these are issues that I think we can do a lot of great 
work on and we have been. And I think we also pride ourselves 
on this Committee that we have passed over 30 bills I think in 
the past year unanimously out of the Small Business Committee. 
So, we have some great ideas that we continue to hear in 
hearings like this that we will follow up and take some action 
on. And to the extent that you have additional information to 
supplement your testimony, we would love to receive that 
through the staff so that we can have discussions about what we 
can do to kind of fulfill our dual purpose. As Mr. Hern 
mentioned, I think we all share this view that we have a dual 
purpose here. One is to kind of reduce barriers and kind of get 
red tape and bureaucracy out of the way of innovation when it 
is necessary when we can do that. And as a matter of fact, the 
broader Committee merged two programs in the Federal Government 
last year to make it easier for veterans to certify their own 
small businesses and reduce some barriers and red tape. And I 
think that is a great example of us working together to make 
things easier for folks.
    But the secondary purpose is really finding ways to promote 
and boost up and where government can get involved in a 
positive way through very directed funding to accelerate and to 
help businesses through the ``valley of death'' or other 
difficult areas where the market does not necessarily work 
perfectly but where there might be tremendous innovations that 
can benefit all of us as a society. And if we can shepherd 
those through very targeted investments, we want to find ways 
to do that.
    So, we appreciate you all sharing your time and experiences 
with all of us.
    And I would ask unanimous consent that members have 5 
legislative days to submit statements and supporting materials 
for the record.
    Without objection, that is so ordered.
    And if there is no further business to come before the 
Committee, we are adjourned.
    [Whereupon, at 11:13 a.m., the subcommittee was adjourned.]
    
    
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