In addition, the office wants to be action oriented and results oriented. In a university, she acknowledged, these are “often oxymorons,” but Stanford had been unusually successful. The technology transfer office was 40 years old, having begun operations in 1970. Since then it had seen some 8,300 cumulative invention disclosures, executed more than 3,500 licenses, and held about 1,200 active licenses. “We have a lot of active licenses because inventions come and go; patents get issued and then expire.”
Ms. Ku mentioned a few notable Stanford inventions “just because you probably don’t recognize most of them.” One of the first was FM sound synthesis, created by a small Yamaha music chip developed by the music department. “We were very proud that one of our biggest inventions, the Yamaha chip, came out of the music department,” she said. “It’s probably in your cell phone; every time your phone plays some interesting song, that’s probably a Yamaha chip.”
One of Stanford’s biggest inventions was recombinant DNA, the cloning technology that has enabled people to put genes into bacteria. This invention generated some $255 million in royalties, which was shared with the University of California, and licensed to about 440 companies.
“The one that I want to mention just because we’re in Hawaii,” Ms. Ku said, “is phycobiliproteins proteins. I love this term. It’s a fluorescent compound that comes from algae, and it was developed through a collaborative effort between a University of California professor and a Stanford professor. They came up with a compound from algae that can be used in fluorescent-activated cell sorting.”
From work in the early 1990s, Stanford researchers also devised a rendition of DSL (digital subscriber line) technology that proved popular. It allowed subscribers a cheaper connection if they were willing to upload slower than they download. In fact, most people do not care how fast they can upload, although they want to download quickly. This technology was eventually acquired by Texas Instruments, which was Stanford’s exclusive licensee for many years.
The Success of Google
Stanford’s most famous licensee, Ms. Ku said, was Google, a company that was built on a technology appreciated by few people initially. “Two graduate students worked on a project for the library for about four years. They used Stanford resources to develop a search engine that we tried to market to the four big search engine companies, but nobody was interested. The two guys were frustrated, and decided to start their own company. We gave them an exclusive license, but we didn’t know if they knew how to do business. We took a little bit of equity, and even that 2 percent share brought in about $337 million in equity. We’re happy we were able to give them that start that they needed.”
These inventions have generated more than $1.3 billion in cumulative gross royalties over 40 years, with a lot of the money staying with Stanford and the inventors, she said. “And we’ve been able to give $45 million back to my boss, the