Editor’s note: This op/ed was written by Kelly King, the retired CEO of Truist Financial who is chairman of the board at NCInnovation. It was published in Business North Carolina. This is an excerpt. WRAL News has reported in detail about NCInnovation and legislation that could lead to a $1.4 billion in funding from the General Assembly.
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NCInnovation has two primary legs. The first is to provide grant funding, administered by the NC Collaboratory, to university researchers in the final stage of the R&D sequence — when the “R” for research starts turning into the “D” for development.
This narrowly tailored focus is intentional. Support largely exists, either through the federal government, universities, or other nonprofits, for researchers to take an idea and advance it to proof of concept.
- MORE COVERAGE: WRAL Editorial: NCInnovation is a good idea, but NC Senate’s funding scheme is misguided
But a research output at proof-of-concept will not generally attract private capital. More work must be done. What that work looks like depends on the sector — perhaps it’s scaling up production of a promising molecule in advance of U.S. Food and Drug Administration analysis, or adapting a novel transistor for a higher-voltage scenario.
It’s at this phase of the research sequence that most products die. In fact, the term of art in finance is the “valley of death.”
The valley is especially acute at less-resourced universities outside the urban centers. There just isn’t the money or the network to piece together funding for the last stage of the R&D sequence for most researchers. So those researchers either move on to something else or they move to another state.
That’s why NCInnovation will focus exhaustively on the valley of death. We will offer grant funding, delivered through universities in stages and subject to binding legal agreements, to get researchers to the point their product becomes commercially investible. In doing so, more companies will form out of university research, creating jobs with a higher probability of staying in the community that birthed them. It’s rural economic development via homegrown innovation.
