Sandia LabNews

Tenchnology Ventures Corp. model embraced

TVC to open technology commercialization offices in California, Nevada, Northern New Mexico

From now on, when someone refers to Technology Ventures Corporation as a "model program" of its kind, they won’t be talking in purely figurative terms.

TVC is a model program — literally, officially.

With a new $1.5 million contract — in the form of a cooperative research and development agreement (CRADA) — from the National Nuclear Security Agency to adopt its business model to NNSA facilities in Los Alamos, N.M., the Nevada Test Site (near Las Vegas, Nev.), and Livermore, Calif., TVC moves to the very front of the class among organizations designed to move technologies from national laboratories to the marketplace.

The CRADA stems from efforts that originated with Sen. Pete Domenici, R-N.M., who has long recognized the substantial and unique role that TVC has played in advancing the New Mexico economy over the past decade.

TVC model has worked well

"I want to thank Sen. Domenici for leading the effort for this funding," says TVC president Sherman McCorkle. "I look forward to the opportunity to augment the great work going on at these other facilities to create private sector jobs."

In addition to Domenici’s leadership role in helping secure the funding, key support was offered by Sen. Jeff Bingaman, D-N.M., Sen. Harry Reid, D-Nev., Rep. Ellen Tauscher, D-Calif., and Rep. Heather Wilson, R-N.M.

Lockheed Martin established TVC in 1993 as a nonprofit subsidiary. Its role was to foster technology commercialization by working with potential entrepreneurs from publicly funded research labs, helping them secure venture capital for their technology-based start-ups. According to McCorkle, the TVC proposal was one of the key distinguishing elements, along with its plan for increasing diversity opportunities in the Labs, that tipped the balance in Lockheed Martin’s favor when DOE awarded it the contract to manage Sandia after a 44-year run by AT&T.

The $1.5 million award from NNSA (with the potential for up to $3 million in FY03, pending Congressional approval) is explicit recognition that the TVC model has worked — and worked well. With its infusion of new funds, TVC will open staffed offices in Los Alamos, Livermore, and Las Vegas to become more proactive in identifying and moving to market the labs’ most commercially viable technologies. McCorkle emphasizes that the new TVC offices will augment — and not compete with — existing commercialization efforts at the NNSA labs.

"We don’t get into licensing of IP [intellectual property], we don’t get into royalty payments or patents. We help technology-based businesses secure equity capital," McCorkle says. "Our function will be complementary to existing commercialization efforts at the other labs, just as it has been at Sandia."

Raising capital is heart of TVC success

The TVC model is simple, really. And, as McCorkle says, it hasn’t changed "one iota" since TVC’s inception more than nine years ago: You identify the most promising technology-based business start-ups you can find. (A lot of the entrepreneurs TVC has helped over the years come out of Sandia, but its doors are open to any promising technology start-up.) You work with entrepreneurs, coach them in the ways of the marketplace, help them refine their business model, assist with market research, and, finally, help them find and secure risk investment.

That last — securing investors — is the real heart of TVC and the point and purpose of its signature event, the annual New Mexico Equity Capital Symposium. That’s the forum that gives entrepreneurs a platform for making their "sales pitch" to an audience of professional equity investors from across the nation.

Based on the proven model, TVC since its inception has played an instrumental role in the formation of more than 5,600 jobs in the region. It has helped attract some $330 million in equity capital investment. Even more telling — and potentially significant for New Mexico’s economy — is the fact that, as McCorkle notes, when TVC was formed there wasn’t a single venture capital firm operating in New Mexico. Now there are 11 such firms with staffed offices in the state. And that means there’s a better-than-ever chance that innovative New Mexico start-ups will attract the attention of the folks whose business it is to identify and invest in speculative business propositions.

"One of the unique things about TVC, and one of the key reasons for our success," McCorkle says, "if that we believe that we have two customers — the entrepreneur and the investor. And we act on that belief. Since we’re not-for-profit, both our customers know that we’re not trying to sell them anything except success."

Lockheed Martin deserves huge credit

"This was a new concept when we started," says TVC Business Operations Director Randy Wilson, who has been with TVC side-by-side with McCorkle since the beginning. "For the first year, we spent our time defining how we would make this model work. And subsequently, I think it’s fair to say that our success has exceeded people’s expectations. I’m proud of what we’ve accomplished. The next challenge is to create the same success at the other NNSA labs. I look forward to it."

Says Domenici: "Since TVC’s establishment I’ve been impressed with their ability to generate results. Their focus on small business start-ups and equity funding is an important addition to traditional partnerships involving larger corporations."

McCorkle, a New Mexico native who has a long track record of involvement in economic development in the state, offers high praise for Lockheed Martin.

"Of course, I’m personally gratified to be involved in a successful enterprise," he says. "But more to the point, I’m thrilled as a New Mexican that we’re helping bring high-quality jobs to the state and helping to diversify the economic base.

"I give all the credit to Lockheed Martin. It had the vision to see that this concept could succeed and the willingness to back it up with financial support. I understand that none of this would have happened if it weren’t for Lockheed Martin."