After launching a couple of startups, a collaborative initiative is coming into its own and aiming to turn Waco into a hub of innovation.
Baylor University, along with venture capital firm Waco Ventures and Blueprints Labs, has formed the Lab to Market Collaborative (L2M) to bring innovative ideas and technologies out of university halls and into the market.
"We noticed that there were a ton of technologies that were in the university, some of them just amazing, transformative ideas that needed stewardship or shepherding from a business and commercialization perspective," said Allen Page, operating partner at Waco Ventures and former general counsel for tech startup Viziv Technologies.
L2M was formed around 2018 and got a boost with a $1.5 million U.S. Department of Commerce grant last year. Through the collaborative, Baylor sources intellectual property assets from its faculty that are ripe for commercialization. After that, the Waco Ventures team performs due diligence, finds market opportunities, builds a team around the business, and finds investors. Waco Ventures Operating Partner Brian Woods said the firm, which has raised around $18 million, will sometimes staff its team in interim roles and back the companies it launches.
"(Universities) invent, we innovate, but what we don't do well… is commercialize the technology. So, we take it over to the experts to do just that," said Todd Buchs, Baylor's assistant vice provost for research and director of technology commercialization and industry engagement.
So far, L2M has launched two startups. The first is 6P Color, a color processing and display system company formed in 2019 and raised nearly $2.3 million in equity funding through the collaboration. Verifi Technologies was launched in 2020 and focused on using modified ultrasound processing to perform structural analysis testing on composite materials.
While Page said the focus is on quality over quantity with the companies it launches via L2M, the collaboration has ambitious plans. He said it's looking to form at least four companies per year, or once each quarter. Waco Ventures looks to source investors in the company while also acting as a backer itself. Woods said the firm's average deal size is between $6 million and $9 million, with it looking to return as repeat backers, growing its investment size over the company's lifetime. Buchs added that L2M allows investors to determine what to do with the companies' intellectual property.
"We want to make sure that the startups that we do bring out are successful because the success of those startups – as they grow and get through exit – are going to enable expansion of the ecosystem," Page said.
Overall, the collaborative's leaders hope the initiative provides opportunities to students through internships with the companies it launches and provides a positive economic impact in the Waco area while creating a density of startup companies and entrepreneurial talent. For Baylor, L2M is part of a push to achieve the Carnegie Commission on Higher Education's R1 classification by 2024 - a designation awarded to public and private institutions nationally, identifying them as places of "very high" research activity. Woods added that, if successful, he sees an opportunity to bring the L2M model to other universities.
"This organization is all about the results and the success that we're trying to build collaboratively. There's no turf, squatting, trying to hold on and grip tightly to things to grab the value. Everybody knows that there's great value in the great win for the group, and we'll all successively rise together," Woods said. "It's our intent and our purpose to build and maintain great technology companies in Waco so that we grow the talent pool… and all the other things that come with community growth."
