University of Utah surpasses the likes of MIT to become the nation's leader in new tech startups

SALT LAKE CITY — Imagine being able to tell if someone is lying based on their eye movement, or how about being able to rid children of head lice without using any chemicals, or using a small device to pinpoint electrical shorts in vehicles.

Students, professors and investors are doing just that through the University of Utah, making the school the largest university generator of startups in the U.S. after tying the Massachusetts Institute of Technology for the previous two years.

Even more notable is that the university creates startup companies at a fraction of the cost compared to other top universities.

In 2009, the U. created 19 startup companies based on technology research, surpassing MIT and the California Institute of Technology, according to the Association of University Technology Managers. The report ranked 181 public and private U.S. research institutions.

This fertile field of new, innovative, companies has created thousands of new jobs in Utah, has hauled in millions in revenue, and has generated millions more in tax dollars.

The U. has 98 startup companies in operation and has created 5,937 direct jobs with another 9,830 indirect jobs created through local spin-off contracts and services, according to the Utah Bureau of Economic and Business Research.

All those employees earned about $359 million in 2009.

Campus startups and research licensees (individual research) also generated about $77 million in state and local tax revenue in 2009.

"It's not just that they're jobs, but they're good jobs," Jack Brittain, the U.'s vice president of technology venture development, said.

The average Utah worker earns $38,000 annually, according to Utah Workforce Services. By comparison, the average technology venture job pays nearly $60,000, Brittain said.

So what is the University of Utah doing right? Since 1970 technology startups at the university averaged five a year. For decades, the U. was handling technology properties the way most universities traditionally have: focusing on securing patents and collecting income without offering any real help for commercial development, Brittain said.

"The commercialization office invests in patents and then they try to go and collect money from licenses, and that's all they do; just patent and then try to sell the patent. That's a faulty business model," Brittain said, adding that many universities end up losing money, rather than making any.