Thank you, Mr. Chairman, and thank you to the committee for this opportunity to speak.
Simon Fraser University, like most universities, was in the 1990s a traditional technology-transfer-oriented--i.e., a technology-push-oriented--institution. We take a technology, patent it, and license it to an existing company or a new start-up.
One of our most notorious success stories in this area is the V-chip. The V-chip is now under U.S. legislation, mandated to be in every single television set that is sold in the United States. It actually made its way to the White House, and Bill Clinton and Al Gore were involved in helping us put it into legislation. It's also one of our more notorious and better-known spinoffs.
At SFU, our intellectual property policy is inventor-owned. While the university is entitled to a small percentage on any successful commercialization, it is incumbent on my office to invest time and money in new ventures that are created.
New ventures, in my view, can produce better financial returns than those generated from royalties and licensing fees--i.e., the traditional model. As we've seen, payback on licensing is actually quite minimal. Globally it's well under 1% of R and D expenditures.
The big returns in technology have come from entrepreneurial students, often dropouts--for example, Bill Gates, Michael Dell, Richard Branson, and, in Canada, Mike Lazaridis of RIM.
I remember negotiating RIM's first angel investment back in 1987 when I was in Waterloo, when they were a struggling operation located above the 7-Eleven strip mall. They had no university support. Instead of dropping out of university, maybe they could have been encouraged to stay in. Maybe the university could have given them some entrepreneurial guidance and support. If we could embrace and nurture start-ups such as this, maybe there would be many more RIMs.
Students, in my view, are the instruments for technology transfer. Lazaridis often makes this point about commercialization. His point is that the university's job should be to produce talent for companies like his. While I agree with that, I think it's also important that we encourage more companies like RIM to begin.
Commercialization is synonymous with entrepreneurship. Indeed, the federal S and T strategies identify entrepreneurial advantage as one of three important Canadian advantages. Entrepreneurs are the champions of innovation. Sometimes faculty members become entrepreneurs, but more often than not it is their students who do so.
The internal reward system in universities does not encourage faculty members to pursue industry links to look for industry problems in need of advanced research solutions. Dr. Branda, who is with me today, will speak to that aspect. In fact, he is head of one of our up-and-coming spinoff companies, Switch technologies.
Instead of pushing out technology or developing linkages with industry so that industry can pull technology through faculty liaisons, I believe the operative word here should be “pump”. We should pump up the students by fostering an entrepreneurial environment--i.e., through developing resources, mentoring, angel investors, business connections, access to lawyers, accountants, IP professionals, marketing people, venture capitalists, and other entrepreneurs.
This could be accomplished with a very modest incremental investment, or even the repositioning of current activities. We do this at Simon Fraser University through additional support for the so-called indirect costs of research, along with support from organizations such as NRC, Western Diversification, and Industry Canada.
We have become very active in community-wide, province-wide programs to provide this kind of support to budding entrepreneurs and students. We run mentor panels, business competitions with substantial prize money, and angel networks. In the last decade over 500 companies and entrepreneurs in British Columbia have been helped through this process.
Along with UBC and other organizations, we have created the Vancouver Enterprise Forum, the VANTEC angel network, an angel fund, and many other initiatives. This latter--