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Utek Is The First Comprehensive Innovation
Services Company Focused On Helping Their Clients Become Better Innovators
Services
Business Services
(UTK-AMEX)
Utek Corp.
2109 East Palm Avenue
Tampa, FL 33605
Phone: 813-754-4330
Dr. Clifford M. Gross Ph.D.
Chairman and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
Published – May 2, 2008
BIO:
Clifford M. Gross, Ph.D., CEO
Dr. Gross serves as
Chief Executive Officer and Chairman of the Board of Directors of UTEK
Corporation. Dr. Gross previously held the appointment of Research Professor
and Director of the Center for Product Ergonomics at the University of South
Florida. In 1984, he founded the Biomechanics Corporation of America and
served as its CEO until 1995. Before this he held positions as Acting
Director of the Graduate Program in Ergonomics and Biomechanics at New York
University and Chairman of the Department of Biomechanics at New York
Institute of Technology. Dr. Gross has received eighteen patents and has
produced numerous publications. His most recent book, co-authored with Joe
Allen, entitled Technology Transfer for Entrepreneurs (Praeger
Publishers, December 30, 2003) describes how companies can utilize federal
laboratory innovations to invigorate their product offerings and strengthen
their core technology. Dr. Gross received his Master's and Ph.D. degrees
from New York University and currently serves on the Board of Directors of
the Technology Transfer Society.
Company Profile:
UTEK® is a leading Open Innovation company. We offer a
comprehensive suite of services to leverage external sources of R&D and
create value from intellectual property. In addition, UTEK has developed
what we believe to be the largest proprietary database of intellectual
properties available for immediate license, which when combined with our
global network of over 2,000 universities, research laboratories and
companies provides our clients with unparalleled access to external
innovation.
Clients range from rapidly
growing small capitalization firms to Fortune 100 companies. UTEK has
operations in the United States, United Kingdom and Israel and trades on the
American Stock Exchange and London Stock Exchange-AIM under the ticker UTK.
Innovation Services Provided:
- Strategic innovation consulting
- Patent analytics
- Global technology licensing
- University, laboratory & corporate sources
- Cash and equity transactions
- Web-based IP (Intellectual Property) services
UTEK clients gain access to technologies from
around the world:
- In excess of 2,000 universities, companies and laboratories are in the
UTEK IP Network
- World's largest database of university technologies – currently in excess
of 53,000 available for immediate license
-Ten years of relationship building and successful transactions with
universities and companies worldwide
-In excess of 100 transactions completed
- >60 active engagements (paid retainer)
CEOCFO: Dr. Gross, what is the vision for
Utek?
Dr. Gross: “Our focus is to help our
clients become better innovators and to do that, we have assembled a suite
services product that we believe is the first comprehensive suite of those
types of services that allow companies to innovate more rapidly. Therefore,
we are really the first Open Innovation services company and the only
publicly traded of innovations services companies to best of our
knowledge.”
CEOCFO: Who
would be a typical client for you?
Dr. Gross: “Our customers are quite
diversified. They range from microcap publicly traded companies through to
the Fortune 100 companies, such as DuPont on the larger side as an example
of the customer. We have several business units and quite a number of
clients. With our online businesses we have over 300 current clients. In the
consulting service business, we have approximately 65 current corporate
clients, which are retained relationships.”
CEOCFO:
Tell me a bit more about the specific services you are offering and what it
means to be an Open Innovation company?
Dr. Gross: “The services that we offer
are interrelated. They are all focused on one thing: helping company clients
become and better, faster innovators. We provide strategic innovation
consulting. Those are engagements where we identify for example the product
categories that we believe companies can successfully enter and dominate. We
have a group that provides patent analysis. It’s very important if you’re
going to acquire and introduce a new product that you make sure that you
know the prerequisite intellectual property rights. So we have the ability
to analyze very large patent portfolios for both our clients and our
competitors.
We have a global technology licensing business whereupon a client may come
to us and say for example, ‘We are interested in acquiring a certain set of
diagnostic tools.’ We have relationships with more than 2,000 universities
around the world that disclose to us new discoveries from their faculties
and are available for licensing. So we find technologies that are relevant
for our clients, negotiate, acquire them, and transfer them to our clients.
We have done more than 100 transactions like that.
The last category of services is web based
intellectual property services. We have four web-based businesses and the
common denominator there is that those are online businesses that help our
clients buy or sell intellectual property.”
CEOCFO:
Will clients tend to use several of these services or does each segment have
a separate marketplace?
Dr. Gross: “Each of the individual
business units are separate business units, separate management teams and
they can stand on their own two feet. But many of our clients engage us, for
example to source a new discovery, they need a new technology and we will
show them technologies from an number of research institutions around the
world that are available for acquisition. Then once they acquire those
technologies they may want to do a detailed analysis of the patent landscape
to make sure that they own all the requisite intellectual property rights
necessary to have a propriety advantage over that new technology.
Then some of our customers while they are doing that, they also have an
interest in out-licensing some of their intellectual property to generate
additional revenue streams so may they avail themselves on a number of our
online businesses. Therefore, our goal is to provide a turnkey open
information service for our clients. We don’t require our clients to use
every one of our businesses units, but we make them available to our clients
so that they can get the job done as readily as possible.”
CEOCFO: You
are the first publicly traded company focused on open innovation; is there
much competition outside of the public arena?
Dr. Gross: “There is some very good
competition in the individual business units. For example, in our
innovation-consulting unit we have terrific innovation consulting services,
but there are large successful consulting firms that offer innovation
consulting like the Boston Consulting Group. In the patent analysis arena
there are some very good firms available for patent assessment like Ocean
Tomo and Micro Patents. In web based IP services there are some very capable
firms that offer help for finding or out-licensing discoveries, which is
9-Sigma,and Yet2com. Then in the global technology licensing there are good
competitors as well like IP Group, and XLtech, but there is no company in
the world to our knowledge that actually offers that whole suite of services
in a seamless way. That makes it short work for a large company seeking
business results from an innovation services company.”
CEOCFO: How
do you reach a potential customer?
Dr. Gross: “We have a pretty
comprehensive business development group in-house. It is headed up by Bill
Cawley who was an executive at IBM for over 22 years. He is our VP, Business
Development. We have approximately ten executives in a sales organization
that sell our services to senior management in companies around the world.
We have major offices in Tampa. We have back up data center in King of
Prussia, Pennsylvania. We also have an office in Chicago, for our Consulting
services. We also have an office in York in the United Kingdom that provides
our services to UK and European companies.”
CEOCFO: Is
the international area a major growth area for you?
Dr. Gross: “Yes it is actually. About
22% of our business is either in the UK, Europe, or Israel; up from 9% a
year ago.”
CEOCFO: How
is business in general and what is the financial picture today?
Dr. Gross: “We think it’s good. It has
changed quite a bit because about a year ago, most of our customers were
microcap companies and we made a conscious decision to diversify our
customer base with companies of all sizes. We still work with microcap
clients, but we have added quite a number of mid-cap and large-cap
customers. In terms of our consulting service work, last year at this time
we had approximately 39 clients and right now we have approximately >60
clients. We have almost doubled the number of clients year-over-year. A year
ago, the average market cap of our clients was approximately $20 million.
The average size today, is over $1 billion. So we have significantly
increased both the number of clients and their diversity in terms of the
size of the organizations that we work with.
For our online businesses, a year ago we had approximately 135 clients and
currently we have about 340 clients for our online services where customers
buy and sell intellectual property. The online businesses have grown
rapidly. Last year we had approximately $20 million in revenue from
operations and approximately $3 million in income from operations after
taxes. We have a pretty good balance sheet for our size of company. As of
December 2007 we had about $43 million in net assets including cash, cash
equivalents, good will and equity stakes in approximately 60 companies, most
of which are publicly traded.”
CEOCFO:
What are the hot areas in intellectual property today?
Dr. Gross: “Yes intellectual property is
very important today. This was well underscored by the Research in Motion
litigation about a year ago. It shows that a company can have a great
product and own its technology as Research in Motion did but not all of the
IP upon which the technology was built upon. In addition to the technology
you also have to own or license all of the relevant intellectual property
that the technology rests upon. IP is an area that companies can gain or
lose competitive advantages pretty rapidly. In terms of different sectors,
although we are sector agnostic in as much as we service companies in a wide
variety of industries, we are starting to see a lot of emphasis even from
non-environmental companies, on becoming more green corporate citizen with
regard to the raw materials that companies are using in their manufacturing
processes and products. A lot of our clients are requesting us to source new
discoveries that support greener manufacturers and suppliers of products
worldwide.”
CEOCFO:
What do you see in the next two or three years down the line for Utek?
Dr. Gross: “We believe that we will grow
our consulting services business and basically that will be the cornerstone
of the services that we provide. We are focused on innovation consulting
combined with a high technology licensing, coupled with, patent analysis
and web-based exchanges for the buying and selling of intellectual property.
In short, technology infused innovation consulting services.”
CEOCFO: In
closing, address potential investors; what should they be interested in and
what might people overlook that really should be understood about Utek?
Dr. Gross: “To our knowledge, we are the
only publicly traded Innovation services company in the world, so if you are
interested in a company that’s providing these types of services, we are a
leader in that space. The Aberdeen Group in December 2007 published a
research report where they surveyed almost 350 companies and they asked
them, what were they doing to become more innovative? About a third of them
said they were planning to implement an open innovation program in the next
24 months. The main reasons given were to increase the growth and reduce the
R&D expenditures. Therefore, if you think that Open Innovation is an
important area for companies to focus on, and we really believe it is
important, because it’s one of the few tools that companies could use to
expand or grow their business while reducing the costs for R&D; then Utek
might be an interesting potential investment for you.”
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