From lab to launch: The tech transfer revolution reshaping universities

Buried inside a sprawling administrative bill passed in December 1980 was a small technical change that became one of the most economically important US policies of the 20th century.

Few paid attention as Congress passed the Bayh-Dole Act, outside a tight circle of university research administrators and patent advocates who’d lobbied for the change. The amendment allowed universities, small businesses and nonprofits to own the inventions developed with federal research dollars — giving them the right to patent, license and commercialize discoveries.

Just months later, Stanford University licensed the Boyer-Cohen recombinant DNA patent to a fledgling biotech company named Genentech — a now legendary deal that generated hundreds of millions of dollars of university licensing revenue and catalyzed billions more. That started the modern biotechnology industry and came to define what is now called university tech transfer.

The shift was enormous. In the pre–Bayh-Dole era, tens of thousands of government-owned patents sat unlicensed across federal agencies. Even world-changing discoveries routinely died in institutional limbo.

One prominent example: on Valentine’s Day 1945 at the University of Pennsylvania, Presper Eckert and John Mauchly unveiled ENIAC, the world’s first general-purpose electronic computer. It was federally funded as part of the Second World War. 

Unable to commercialize it, Eckert and Mauchly left academia to form a new firm. Without university support, they struggled to capitalize on their invention — the computer revolution happened elsewhere, and few involved in ENIAC benefited.

That was the old system: Invention was admired, commercialization was suspect. Today, research universities are chasing a different story.

“Universities used to just rack up patents,” Karina Sotnik, CEO of WorldUpstart. “Now they’re also helping bring innovation to market — and that’s a big shift.”

Sotnik spoke with Technical.ly alongside Ben Dibbling, managing director of Penn’s Center for Innovation — the University of Pennsylvania’s outward-facing tech transfer strategy. 

“It’s about building relationships with industry,” Dibling said. “Recruiting experienced CEOs for academic founders and helping spinouts cross the ‘valley of death’ between research and revenue.”

From patents to partnerships

Bayh-Dole was essentially written to ensure there would never be another ENIAC. Yet the instinct to commercialize surfaced long before the 1980 reform.

In 1925, University of Wisconsin biochemist Harry Steenbock patented his vitamin D fortification discovery and created the Wisconsin Alumni Research Foundation to license it, striking an early deal with Quaker Oats. Two decades later at Stanford, electrical engineering dean Fred Terman encouraged two of his students — Bill Hewlett and Dave Packard — to commercialize their oscillator project. That mentorship culture helped seed Silicon Valley itself. 

By the late 1970s, however, these examples were the exception, until Bayh-Dole. The act created a uniform national framework that allowed universities to actually act on this instinct, and usher in research institutions as economic engines. 

In the 45 years since, the policy has underpinned far-flung inventions across disciplines, including Google’s PageRank (Stanford), the Honeycrisp apple (Minnesota) and Gatorade (Florida).

More recently, the Nobel Prize–winning modified mRNA technology pioneered by Penn’s Katalin Karikó and Drew Weissman became foundational to COVID-19 vaccines in months, not years.

Tech transfer is now less about the patents themselves and more about the systems around them, noted PCI’s Dibbling. A February 2025 review of nearly 2,000 academic papers on university technology transfer shows this shift clearly. In the early 1990s, researchers were focused on the process and policy. Today the focus is on the “third mission,” or the commercialization ideas that follows the teaching of principles and the research and development. 

Between 1991-1995, more than 1 in 5 papers were process focused, nearly four times as many as those discussing the ideas themselves. By 2020-2022, those totals had effectively flipped.

Put simply: scholars are now studying how universities actually make innovation work, not how they administer it. Good thing, because as other research has increasingly warned: It’s getting harder to develop breakthrough ideas.

Building the ecosystem around the idea

Decades of pro-entrepreneurship research have focused on who commercializes ideas. But at least as important is what they’re commercializing in the first place.

Two separate economic paths — of entrepreneur support and of university tech transfer — have now converged.

As early as the 1980s, entrepreneurship advocates argued for “economic gardening,” a place-based economic development strategy focused on startup seedlings rather than big-firm relocations. In the age of the leveraged-buyout, this was mostly ignored. 

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The Great Recession shifted that, as a Technical.ly special report argued. In 2012, Thomas Lyons argued that regions needed entrepreneurial service systems — presaging today’s “entrepreneur support organization” nomenclature. Decades of Kauffman Foundation-funded research codified the “ecosystem building” metaphor, and led to a raft of entrepreneur support programs plus an influential ecosystem building playbook in 2019. That same year, Startup Cartography Project mapped entrepreneurial infrastructure.

Many entrepreneur boosters focus on small business, which Americans overwhelmingly trust. But Silicon Valley’s economic engine inspired a generation of economic development to focus on breakthrough innovation and job multiplier effects — which brings many back to the scientists. 

From transfer to acceleration

This ecosystem shift is reflected in how we help ideas leave the lab. The modern startup accelerator turns 20 this year. Y Combinator marks the apex of this Silicon Valley generation, spawning Airbnb, Reddit, DoorDash, Twitch and in some sense OpenAI founder Sam Altman’s career. 

Many others have followed its now-familiar structure: a compressed sprint, intense mentorship and a demo day. At its best, the model distilled a set of startup truths — talk to customers early, iterate fast, stay focused — that still shape founders today.

But accelerators are evolving, especially in complex fields.

“Cheap-money SaaS accelerators worked in 2010,” said Heath Naquin, senior vice president of innovation and new ventures at Philadelphia’s University City Science Center. “But med-tech founders have to navigate regulation, valuation and capital readiness.”

He added: “You don’t want a hallucination on your patent claim.”

The Science Center does not have a “demo day,” purposely skipping that accelerator icon. But the half-century-old facility blends both serious educational programming and the social and cultural elements of modern pro-entrepreneurship culture.

As Naquin put it: “We focus on the daytime strategy — the serious commercialization work — and pair it with the social energy of the ecosystem.”

The new frontier: Who creates the breakthroughs?

Even with universities better embracing the go-go startup culture of accelerators and splashy parties, new evidence suggests the next major shifts may still hail from outside the center.

A Stanford analysis last year of millions of speeches, rulings and earnings calls found that the most transformative ideas almost always begin on the periphery, including small firms, junior staffers and non-elite institutions.

“Where you sit matters as much as who you are,” coauthor Amir Goldberg told Stanford.

Innovation often comes from the edges. This reinforces the in-vogue “ecosystem approach,” which teaches that the apex predators of elite universities and staid economic development organizations cannot ignore the noisy and fractious startup, meetup and innovation culture.

WorldUpstart’s Sotnik says universities must embrace the role of leadership in ideas, while also supporting the rest.

“The most important role university programs can play is finding an experienced CEO for the researcher,” Sotnick said. “Investors don’t fund science projects — they fund teams.”

The question facing universities today isn’t whether they can hold the patents — Bayh-Dole settled that in 1980.

The question is whether while facing unprecedented federal pressure, universities can still produce and share the breakthroughs that keep new industries forming inside (rather than outside) the academy.

Entrepreneurial ecosystem-building needs universities that house and transfer bold ideas. The question of who commercializes invention may be as important as where.