A combination of science and business acumen from the University of Rochester and University of California (UC), Berkeley won the $50,000 first prize Wednesday night (April 23) at Purdue University's inaugural Life Sciences Business Plan Competition. Winner Iris AO, Inc. went into the competition with two earlier wins under its belt, including a $50,000 first prize at the UC Berkeley Business Plan Competition and $25,000 from the MBA Jungle Business Plan Challenge.
In a harsh funding climate, the contests that were once considered dress rehearsals for the real business world have turned into a source of serious money for life sciences firms seeking a way out of the academic womb.
"There's more interest in these competitions now than ever, because it is so competitive to get to the seed money," said Richard A. Cosier, director of Purdue's Entrepreneurship Center, which launched the competition with $120,000 in cash and $24,000 in legal and accounting services as prizes.
Iris AO, Inc. is developing microelectromechanical systems (MEMS) –based adaptive optics technology for disease detection and vision correction. National Science Foundation funding led to the collaboration among some of the scientists in the company, but the $125,000 in prizes garnered from the three contests is the company's start-up stake, chief operating officer Matthew Campbell said.
"We have not taken in any sort of investment," Campbell said. "It was a tough year to raise money, so we really hustled and signed up customer contracts and kept expenses very low."
Second-place winner Medical Reporting Solutions, a voice recognition technology firm started by a doctor at Indiana University–Purdue University Indianapolis, took home $40,000 in cash, including $20,000 for being the top Indiana entry. Third place brought NanoString Technologies, of the University of Washington in Seattle, $15,000. The company has developed a probe to label unique molecules for gene profiling.
Indianapolis-based Roche Diagnostics put up $100,000 of the prize money to serve as a major sponsor. The company wants access to academics with good ideas, said spokesman Joel Reuter.
Iris AO, Inc. got its start as a company across a table at a luncheon UC Berkeley hosted to get its MBA students in touch with scientists, according to Campbell.
Cosier noted that firms combining business and science often fare better than science-only contestants. "Pure scientists who try to go it alone generally don't do as well in these competitions," he said. "Questions about finance, the market, and management go largely unanswered, and that hurts them."
Yet science start-ups often outshine fledglings from other industries in open competition. Life sciences firms have taken the grand prize at the Wharton Business Plan Competition 3 out of the last 4 years. This year's winner will be announced Monday (April 28), and three of eight finalists are from the life sciences.