Business Incubator Series: Stephen Fleming, Enterprise Innovation Institute, Georgia Tech – Atlanta (Part 4)

By guest authors Irina Patterson and Candice Arnold

Stephen: As far as technology, we have a database that works internally. For our needs, it’s great. It’s basically a CRM [customer relationship management] system that we developed internally. All our employees get full access to it. The mentors get limited access. The entrepreneurs get even more limited access, but everyone can get basic information out of it. It’s CRM, but the customers, in this case, are entrepreneurial companies. We never see their customers. To us, they’re our customers. They’re our clients.

Irina: Is there any specific methodology that you use to coach them?

Stephen: Yes. We’ve developed it. We don’t have a name for it. If anything, it’s the “school of hard knocks.” We’ve all done this before. Some of us have done it more than once. Obviously, we’re always learning. Every time we work with a company, we learn something. None of us has been ambitious enough to put a name on our methodology. It’s just the way we do it.

Irina: What are your metrics for success?

Stephen: At the end of the day, somebody has to buy what they’re selling. If their product or service is attracting customers, that’s a good thing. If it’s not, we need to understand why. Keep in mind, we have a wide variety of companies in our incubator. For example, for the life science entrepreneurs who are building medical devices it can take years and years and years before they’re in a position to earn any revenue.

So, we would not hold them to the same criteria as we would an entrepreneur who’s building an Internet startup where she should have revenue almost instantly. With a medical device company, it may be the better portion of a decade. That’s OK. It’s a different business model. We have different catalysts [internal experts] who specialize in those businesses, so we can adjust accordingly. That’s the biggest metric.

We track a lot of things. We track the number of employees. We track the amount of capital they’ve raised, if they’re raising external capital. We track it when they acquire companies or get acquired by other companies and what those transactions look like. The real value is when one of their customers chooses to buy something. That revenue is the most important metric.

Irina: What are some of your success stories?

Stephen: We always like to mention one that was successful back during the Internet growth period. It was an Internet service provider called MindSpring. MindSpring merged with a company called EarthLink. The combined company took the name of EarthLink, but it actually ended up moving into the MindSpring offices here in Atlanta.

The MindSpring CEO became their CEO. EarthLink is still a very successful company. The days of Internet service providers are not what they were back in the late 1990s, early 2000s, but [the company] still has thousands of employees, millions of customers and would not have existed without ATDC.

More recently, [there are] a couple of companies we like to brag about. One is on the medical device front and is a company called CardioMEMS, based on Georgia Tech development. They build – in simplistic language – a pressure gauge that you can implant inside the human body so you can measure a patient’s blood pressure, wirelessly, in real time.

In certain conditions and for people with certain disorders, that can save their lives. It’s very impressive. Implanting something inside the human body is both technically challenging and, from a regulatory point of view, very difficult. That’s one of those companies that took a decade [to get the product out], but it has been successful. The product is out there in thousands of patients and is working well. The company, as an investment, has done well for its investors.

The last one that we have been talking about lately because everyone’s concerned about $4-a-gallon gasoline is a company called Suniva, sun [stands] for solar. It’s based on some Georgia Tech intellectual property around solar cells.

Our team convinced the innovator, the professor, and his team that the time was right to start a company. He was really an academic and not focused on commercial opportunities. So, we helped to recruit a management team. We helped him to raise a significant amount of venture capital, through several rounds. It’s well over $100 million.

They’ve built a factory here in the Atlanta suburbs, where they’re cranking out an enormous quantity of solar cells. By many metrics, they’re actually the best in the world for efficiency. They’re running multiple shifts a day. They employ 200 people. They’ve invested over $100 million. That’s not only jobs, but a positive impact on the environment as well as the economy. That’s been a success coming through in the past year or two.

Suniva are selling their product. They have more than $1 billion of backlog in orders for their solar cells. They’ve been selling a lot of solar cells.

This segment is part 4 in the series : Business Incubator Series: Stephen Fleming, Enterprise Innovation Institute, Georgia Tech – Atlanta
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