Forming a New Technology Venture:
Opportunities and considerations for starting Sharp´s first business development organization

By Jon Clemens, Ph.D., Sharp Technology Ventures

Sharp Corporation, a $20 billion-per-year global electronics company headquartered in Osaka, Japan, has long enjoyed a reputation for developing one-of-a-kind products for consumers and businesses. From consumer electronics products, to integrated circuits and semiconductors to information products, Sharp´s innovations have created new categories of products never seen before, such as the first camera-enabled mobile phone. They also have improved upon existing products to better suit the needs of engineers and consumers alike.

Many innovations from Sharp Corporation are developed by its U.S.-based research and development firm, Sharp Laboratories of America, which has established itself as a premier research and development laboratory in the United States. Founded in 1995 as the only U.S.-based research and development laboratory for Sharp Corporation, the Lab´s mission is to apply Sharp´s world-class research capabilities toward the development of new, innovative technologies that are incorporated into Sharp products for both the U.S. and global markets. Its fundamental and applied research has yielded a number of significant technology contributions that have improved the performance and accelerated the adoption of Sharp Corporation´s electronic products in the U.S. as well as around the world.

While nearly all of the hundreds of patents and technologies developed at Sharp Labs contribute to Sharp Corporation´s one-of-a-kind product strategy, some have implications beyond Sharp Corporation´s products or are appropriate for products or markets that fall outside Sharp´s business strategy. These technologies and patents still have great appeal to many companies in the U.S. -- from venture capital firms and entrepreneurs starting new companies to engineering teams and product developers at established organizations. Sharp Corporation and Sharp Labs recognized that opportunities for business development, co-development of products and licensing of its technologies with other companies in the U.S. could offer additional venues to apply Sharp´s innovations to products in demand.

To take advantage of such opportunities, Sharp Labs recently formed a separate entity, called Sharp Technology Ventures, to focus on business development of intellectual property developed at the Lab with other U.S.-based entities. Sharp Technology Ventures´ technology offerings primarily are derived from Sharp´s intellectual property in materials processing, image processing, wireless and networking, document handling and presentation, and information handling and presentation.

Sharp Technology Ventures, Sharp Labs keep close ties
To position the new company for success, executives decided on several criteria for how Sharp Technology Ventures should be established. First, and perhaps most importantly, it was necessary to maintain a close connection with Sharp Labs. Because all technologies offered through the new organization are developed at Sharp Labs, it necessarily must have close access to the technical, scientific and applied research expertise of the employees at Sharp Labs. Likewise, many researchers at Sharp Labs have previous experience with licensing and business development for applied technologies and will lend additional support to make Sharp Technology Ventures´ efforts a success.

Sharp also recognized there were a multitude of business development opportunities located in the U.S. Therefore, centralizing its headquarters in the U.S. was also a requirement for Sharp Technology Ventures, since typically the intellectual property is aligned with the unique demands of the U.S. market.

Working with Sharp Technology Ventures needed to be as simple and streamlined as possible for partners, who commonly are burdened with frustration about how to obtain the technologies or patents they are interested in. To accomplish this, Sharp Technology Ventures must have intimate knowledge of the research coming from Sharp Labs and know how best to apply them to products within any given product design cycle. The company also needed to possess an entrepreneurial spirit in order to best accommodate and facilitate the varying needs of new and emerging companies and products.

Similarly, the new company´s leader should embody the very same traits as Sharp Technology Ventures. The leader must be an independent executive, rather than an executive overseeing from Sharp Labs or Sharp Corporation, so he could focus on the unique business challenges and opportunities associated with I.P. licensing. At the same time, the leader must also have a solid knowledge of Sharp Labs and its technologies, and must have prior experience with licensing and business development activities. Having served as CEO and president of Sharp Labs until retirement in 2003, Sharp believed Jon Clemens would be the most suited to this task. In addition to building Sharp Labs from its founding in 1995, he served in executive roles with other premier R&D labs like Sarnoff Corporation, and SRI International.

The benefits to Sharp for setting this organization up in such a manner are many. A separate, dedicated organization for licensing and business development provides another avenue for Sharp to leverage its intellectual property, rather than letting this research languish in the lab. Sharp Technology Ventures also has the ability to pursue new categories of research and development that are of value to the U.S. market and would yield benefit to Sharp, but may not be the core focus of the global organization. Finally, the autonomous organization can better respond to the varying needs of partners, negotiate contracts quickly, and can provide high levels of service and support to apply the technologies to products.

Sharp Technology Ventures´ technology packages reflect one-of-a-kind philosophy
After formulating the business structure and operations of the new company, Sharp Technology Ventures then selected from among Sharp Labs´ R&D work to compile the first technology packages to be offered through Sharp Technology Ventures. As a newly formed company, it was important to offer a variety of technology packages at the beginning, so as to demonstrate to our partners the breadth of expertise and opportunities available from Sharp.

One of the first of these innovative technologies Sharp Technology Ventures selected to commercialize is a video summarization technology called HiMPACT^TM Sports. This technology includes algorithms that automatically interpret and detect every key event in a video clip, and tag these events with a unique identifier that can be searched on or edited.

The first application for HiMPACT Sports is for summarizing sports broadcast video, such as every play in football or every pitch in baseball. This technology can be used to summarize multiple sports, including Sumo wrestling, soccer, baseball and more, to provide a viewer with a summary of the key moments in a single game. Beyond sports and entertainment, HiMPACT Sports also can be applied to other industries, such as security and surveillance.

Other technology packages selected by Sharp Technology Ventures for its first launch include

These four technology packages are offered via the yet2.com Web site or through Sharp Technology Ventures´ Web site.

Sharp Labs has also selected a number of patents to make available to Sharp Technology Ventures partners. These patents can be viewed at www.sharptechnologyventures.com.

About Sharp Technology Ventures
Sharp Laboratories of America through its Sharp Technology Ventures initiative pursues business development opportunities with partners who are developing new products or process technologies. The intellectual property is focused in the core research areas of digital audio/video systems, multimedia and wireless communications, digital imaging systems, information technology systems, integrated circuit process technology and liquid crystal display process technology. Sharp Technology Ventures leverages the brand strength and technical expertise of Sharp Corporation, and the reputation for innovation from Sharp Laboratories of America, where its technologies are developed.

For more information about the Sharp Technology Ventures initiative, please contact 360-817-7410, or visit www.sharptechnologyventures.com.

About Dr. Clemens
Jon Clemens, Ph.D. is the leader of Sharp Technology Ventures, an organization created to commercialize innovations and technologies developed at Sharp Laboratories of America. Dr. Clemens served as president and chief executive officer at Sharp Labs from the organization´s founding until his retirement in 2003.

During his tenure at Sharp Labs, Dr. Clemens grew the lab to include more than 275 employees. He structured the lab´s research and development teams around the key areas of applied research that provided Sharp Corporation the most opportunity for innovation and market leadership in North America. These include six core departments, which over the past eight years have contributed directly to Sharp´s category leadership in its product lines, including those for liquid crystal display-based televisions, mobile phones and communications devices and software.

Prior to his leadership at Sharp Labs, Dr. Clemens held executive positions with other premier research organizations, including Sarnoff Corporation and SRI International.