An Engine for innovation
MIT initiative will provide space, tech, and mentorship to new ventures
A panel of entrepreneurs and business leaders joined MIT administrators Wednesday night in kickstarting a new initiative created to invest in research with strong long-term potential but less promising short-term profitability.
President L. Rafael Reif introduced the initiative in a speech leading up to a video reveal, which publically named the initiative for the first time: The Engine.
Israel Ruiz, executive vice president and treasurer of MIT, Provost Martin Schmidt, and Anantha Chandrakasan, head of the EECS department, led the effort to realize The Engine, which will function as a separate entity from MIT.
The Engine’s starting goal is to raise $150 million to invest in startups and research groups, $25 million of which will come from MIT’s own budget. The focus is mainly on “new ventures,” specifically those that can’t be pursued under university research departments or don’t easily attract VC funding, Ruiz said in an interview with The Tech.
The Engine will also provide space to funded projects, beginning with 26,000 square feet in its Cambridge headquarters at 501 Massachusetts Avenue. MIT hopes to make available to innovators over 200,000 square feet of space throughout Cambridge, along with equipment and advisory networks which might not be accessible otherwise.
The impetus for the project came primarily from an op-ed written by Reif in The Washington Post calling for universities to foster less market-favorable innovation through support and investment, Ruiz said.
“The market’s not serving that need. The venture capital model really focuses on something else… it works really well, but it doesn’t serve this,” Schmidt said. “This is why, to some extent, MIT… feels the need to step in and fill this gap.
The Engine also represents the latest entry in a series of MIT programs aimed at improving the innovative commercial and research spheres on and around campus, Schmidt said. These programs include the MIT Venture Mentoring Service, the Martin Trust Center for MIT Entrepreneurship, and the Deshpande Center.
Though the government still plays an important role in funding R&D for high-capital, long-term innovations, it sometimes has trouble identifying worthy projects due to lack of technical expertise. “We’ve worked with federal and state government to really amplify the effect of that research,” Ruiz said.
The Engine will be open to startups from all around the Cambridge/Boston area. Ruiz hopes that The Engine can also provide help with visa issues for international students.
The Engine came together over the last 18 to 24 months, having started early May 2015. Its leadership hopes to have facilities, starting with 501 Mass Ave, operational, and to have investors and startups on board by the spring. Ruiz said that the administration is already engaged in talks with potential corporate investors.
A panel discussion followed Reif’s speech, with input from Sue Siegel, CEO of GE Venture; Antonio Rodriguez, general partner at Matrix Partner; Phillip Sharp, MIT Institute Professor and co-founder of Biogen; Leslie Dewan PhD ’13, co-founder and CEO of Transatomic Power; Jay Bradner, president of the Novartis Institutes for Biomedical Research; and Guru Banavar, vice president and chief science officer for cognitive computing at IBM.
Like the start-ups targeted by The Engine, Novartis is in it “for the long haul,” Bradner said.
Siegel focused on the The Engine’s potential for smoothing friction between academic and corporate institutions through bringing them together in partnership.
Asked for recommendations for the direction of The Engine, Dewan highlighted the importance of using existing infrastructure and partnering with local public institutions such as hospitals. Banavar emphasized that “lowering barrier entry for innovators is utterly crucial.”
The panel was followed by short pitches by six start-ups, all of which were started by graduates or affiliates of MIT. Of the six, Transatomic, a company that’s developing a molten salt reactor that can generate carbon-free, low-cost nuclear power, seems most in line with The Engine’s purported mission.
Details about the initiative were kept relatively secret in the months leading up to last night’s announcement. Staff in the MIT News office could not refer to the initiative by name, referring to it instead by a code name, according to Rob Matheson, an MIT News writer.
The event organizers, however, were not above scattering a few hints for the event attendees: the Wifi networks at the event were named “combustion-2.4” and “ignition-2.4.”