Resources

Life Science Entrepreneurs Glossary

Introduction

For life science researchers immersed in their work, it can be a challenge to understand terms related to the business realm. This glossary provides you with a list of basic terms and descriptions. If you need more help or have questions that are not answered here, don’t hesitate to contact mlc247@cornell.edu or 607.254.6541.

 

Angel investor – a lender who provides financial support to an entrepreneur and/or early-stage business, usually with more lenient terms than bank investors. Family, friends, and/or colleagues may be angel investors. They are usually interested in helping the person and/or business to succeed rather than reaping profit or having a stake in the company.

Bayh-Dole ActIn 1980, the Bayh-Dole Act (PL 96-517, Patent and Trademark Act Amendments of 1980) created a uniform patent policy among the many federal agencies funding research. As a result of this law, universities retain ownership to inventions made under federally funded research. Learn more:

Business incubator – a space that provides laboratory and office space for early-stage businesses. The Kevin M. McGovern Family Center for Venture Development in the Life Sciences, located on the 4th floor of Weill Hall, is Cornell’s business incubator for life science startups.

Business plan – a set of researched aspects of how one intends to form a business, its mission

Buyout – the purchase of a company; purchase of company’s shares, giving the purchaser the controlling interest in the company. An exit strategy for start-ups.

CTL – Center for Technology Licensing – Cornell University’s technology transfer office. The staff at this office guide Cornell researchers through the processes associated with disclosing your technology. The office manages Cornell-owned intellectual property protection and licensing. http://www.ctl.cornell.edu/about/index.php

Conflict of commitment and conflict of interest – these terms refer to conflicts that can arise if a researcher is using university resources or paid time for interests outside their primary work commitments to the university. There are a set of policies in place at Cornell University that provide guidance and resolution. Agreements should be in place prior to a researcher’s commitment to outside work and/or financial endeavors. To learn more, visit the Office of Research Integrity and Assurance page: https://www.oria.cornell.edu/COI/ and see links to documents, including “Appropriate involvement in start-ups by members of the university community” and “Policy 4.14: Conflicts of interest and commitment”.

Copyright – protects words of authorship, such as writings, music, and works of art that have been tangibly expressed. In the US, the Library of Congress registers copyrights that last for the lifetime of the author plus 70 years.

Conception - invention is conceived when a definite and permanent idea of an operative invention is known.

Convertible debt – When a company borrows money with intent that the debt accrued will later be converted to equity in the company at a later valuation. Allows companies to delay valuation while raising funding in its early stages. Typically done in early stages of company, when a valuation is more difficult to complete and investing carries higher risk.

Crowdfunding – internet based raising of venture funds for an idea from many people

Disclosure – when a researcher provides confidential summary of invention to someone. See Invention Disclosure, below.

Due dilligence – inquiry process to obtain accurate disclosure of material and other info that may influence the outcome of the transaction.

Entrepreneur – a person who takes their (or someone else’s) idea into business venture.

Entrepreneur in residence (EIR) – an experienced entrepreneur; Cornell’s Kevin M. McGovern Family Center for Venture Development in the Life Sciences has four EIRs on staff. To make an appointment with one, send a message to mcgovern_center@cornell.edu.

Exit strategy – Plan for the entrepreneur(s) of an early stage company to end their investment in the company by either being acquired (buyout) by a larger company or by becoming a publically traded company (IPO).

Intellectual property – commonly abbreviated as IP; your original idea/ technology that is protectable under patent, copyright, trademark, or other legal form of protection.

IPO – initial public offering; the first-time shares of company stock are offered to the general public.

Invention – your technology, which can be a method or a tangible item.      

Invention disclosure – A confidential form submitted by a researcher to the university’s Center for Technology Licensing office for purposes of describing your invention. The next steps include examination by the office for prior art, then examination by a patent attorney to determine whether patent protection should be sought for the described invention. Cornell University Invention Disclosure forms: http://www.ctl.cornell.edu/inventors/inventor-forms.php

License – legal permission from the owner of intellectual property to practice an invention; in the form of a legally binding agreement between the owner of the IP and the company or entity that has bought (licensed) the rights to practice it. The agreement includes due diligence and other terms.

Limited Liability Company – legal entity that protects its owners’ personal assets from their business’ debts, lawsuits.

Marketing – Promoting your business product and/or service; includes aspects of branding, publicity, promotion, pricing, packageing.

Non disclosure agreement (NDA) – a document signed between two parties in which both sides agree to protect confidential information, particularly if not yet protected by a filed or granted patent, from being shared publically.

Outcomes research - a branch of public health research that studies the end results (outcomes) of the structure and processes of the health care system on the health and well-being of patients and populations. Among the considerations of outcomes research are the health of the patient at time points beyond treatment, and whether the treatment had any effect.

Outsourcing – using services from other business.

Patent – a property right granted by the Government of the United States of America to an inventor “to exclude others from making, using, offering for sale, or selling the invention throughout the United States or importing the invention into the United States” for a limited time in exchange for public disclosure of the invention when the patent is granted.

Pitch deck – a set of slides for the purpose of demonstrating how your idea for a startup business product and/or service can solve a problem in the marketplace. These slides tell very little about the technology itself, and they are rather intended to be of interest to potential investors of the business.

Prior art – Existing technology in similar space. To research prior art related to your technology, use Cornell’s online library resources, or contact one of Cornell’s research librarians for assistance: http://guides.library.cornell.edu/businessplans

Private equity – equity capital not quoted on a public exchange. Investors and funds that make investments directly into private companies

Product concept – the understanding of the dynamics of the technology product or service in order to showcase its best qualities and maximum features to a targeted audience.

Proof of concept – Demonstrated proof of a technology’s feasibility.

Provisional Patent Application – the very first document that is filed for the protection of an invention. It may or may not be continued in the form of a PCT or US Patent, or a patent filed in foreign countries. Its lifespan depends upon whether it is found to be truly unique in the patent landscape, that is, its details do not infringe upon another existing patented technology, and whether the university determines it to have potential success and viabilty in the commercial realm.

Round – A stage of capital investment raised by an early stage company. The first round is called a Seed funding round; next rounds are Series A, B, and C; occasionally beyond.

Seed funding – the initial money used to start a new business, which often comes from the founders’ assets. The purpose is to support proof of concept or create a prototype.

Service mark – a word, phrase, symbol, and/or design that identifies and distinguishes the source of a service rather than goods. It can be legally registered so that the registrant can claim ownership of the mark, a legal presumption of ownership nationwide, and the exclusive right to use the mark on or in connection with the service set forth in the registration.

Translational research - applies findings from basic science to enhance human health and well-being. In a medical research context, it aims to "translate" findings in fundamental research into medical practice and meaningful  health outcomes. See Cornell University's College of Human Ecology's Tools for Translational Research page and the Bronfenbrenner Center for Translational Research.

Trademark – a word, phrase, symbol, and/or design that identifies and distinguishes the source of the goods of one party from those of others. It can be legally registered so that the registrant can claim ownership of the mark, a legal presumption of ownership nationwide, and the exclusive right to use the mark on or in connection with the service set forth in the registration.

Valuation – A process that determines a company’s economic worth. Included in the consideration are the management team, revenue or potential revenue, capital structure, and other factors.

Value proposition – an innovation, service, or feature intended to make a company or product attractive to customers.

Venture capital – usually high-risk investment; if company is successful, reward can be high but if company fails, loss is high.

Venture capitalist – an investor who provides funding to start-up companies and is usually familiar with the business field. Expects to reap profits when the company becomes financially stable and successful.