
How Los Alamos Helps Startups
Tackling new industries, markets, clients and adventures are inevitable for any business that wants to continue on the path to success. However, not every business can afford to take on new ventures alone, and finding new funding resources can be challenging.
For new ventures in northern New Mexico, Los Alamos National Security, LLC, manager of the laboratory, has developed the Los Alamos National Security Venture Acceleration Fund under Northern New Mexico Connect. The fund promotes regional technology commercialization, new company formation and business growth in New Mexico.
The fund facilitates the creation and growth of regional ventures by investing up to $350,000 annually to assist projects involving regional entrepreneurs, companies, investors or strategic partners. Recipients are given 12 months to reach their project goal.
"The fund fills a gap by providing technology maturation funding outside of the laboratory to companies to hit market-based product milestones," said Duncan McBranch, division leader for technology transfer at the lab. "This funding allows the companies to grow into global markets while staying here in New Mexico. This also helps the laboratory by making our licensed technologies more valuable."
The fund will build on the success of the laboratory's internally focused Technology Maturation Fund by serving as an externally focused fund that supports businesses with a Los Alamos affiliation, such as a licensee of intellectual property. The Technology Maturation Fund, awarded to scientists who need funding to demonstrate commercial potential of an innovation, has been available to scientists since 2002 through the tech transfer division.
LANL's manager recently launched Northern New Mexico Connect, an economic development initiative designed to help entrepreneurs in northern New Mexico locate resources such as technology, funding and support services. Connect will capitalize emerging enterprise development programs through dialogue with regional entrepreneurs, collaborations with entrepreneurial development organizations and by learning from other communities' best practices.
"We listened to local community leaders and their concerns prompted us to invest in economic development, education and community giving in the northern New Mexico region," said Lillian Montoya-Rael, director of the laboratory's community programs office.
The Regional Development Corporation, on behalf of Los Alamos National Security, awards funds to selected businesses. The RDC assists New Mexico communities and industry with managing their economic development projects and initiatives and serves as the fiscal agent and a third party in the management of Northern New Mexico Connect.
"The Venture Acceleration Fund demonstrates LANL's commitment to making the northern New Mexico region less dependent on federal funding while diversifying and strengthening the local economy," said Ed Burckle, RDC executive director. "One of the goals of the fund is job creation and retention in the region. In many cases, the scientists who developed or patented the technologies are former lab employees who really enjoy living in northern New Mexico and want to establish their business here where they can remain connected to the local community. The regional economy greatly benefits when the startup company stays in the area because they hire locally and usually pay above average wages; the net effect is greater retail sales and an expanded tax base."
To date, awards have been made to three northern New Mexico startups based on Los Alamos technology:Acoustic Cytometry Systems, Inc.; CIVA, or the Company for Information Visualization and Analysis; and APJeT, Inc.
Acoustic Cytometry Systems Inc., based in Los Alamos, received an award of $98,000 in April and has been working to produce a prototype of the Los Alamos-developed portable acoustic cytometer.
"As a startup company based on licensed Los Alamos technology, we needed early funding to develop and demonstrate working prototypes," said John Elling, ACS chief executive. "Getting to the demonstration stage makes it much easier to raise startup capital and shop for commercial collaborations. The Venture Acceleration Fund is very effective assistance in the early bridge from the laboratory to a startup."
ACS is a recent spinout from the laboratory. Former Los Alamos scientist and co-developer of the technology Gregory Kaduchak is now chief scientist for ACS. The company intends to market its new acoustic flow cytometer to the academic, life sciences research and medical industries.
Used by thousands of life sciences research scientists in academia and industry, flow cytometers traditionally use a sheath flow to focus single cells and particles for measurement in a linear flow to be characterized, counted and/or labeled. The sheath flow consumes gallons per day of expensive fluid and also accelerates the cells so that only microseconds are available to make each measurement.
Acoustic focusing uses sound (acoustic) pressure to focus the particles into a line. This not only eliminates sheath flow, but it also allows users to control how fast the particles move past the measurement point. Longer analysis times increase sensitivity and broaden the range of reagents that can be used in flow cytometry experiments.
ACS will use acoustic focusing technology to improve the sensitivity and resolution of flow cytometers used to analyze and sort cells and particles in a flow stream. Improvements in this technology will help to increase the applications of flow cytometry and lower the cost of the instrument making it more universally available.
CIVA was established in 2006 to commercialize EpiCast, a laboratory-developed software application that uses a large-scale, stochastic simulation model to examine the spread of a pandemic influenza virus strain should it become transmissible from human to human. It was the second recipient of a fund grant. The Santa Fe-based company received $100,000.
In May, CIVA began its project of developing an avian flu pandemic model for the state of Iowa. EpiCast was previously used to model the entire U.S. and, like that model, CIVA will use population, travel and other demographic information to model the avian flu in Iowa. Additionally, the company will help the state develop mitigation strategies should the avian flu become contagious among humans.
"For our business the fund is very important because our corporation is self-funded by the founders of the company," said CIVA chairman L. Robert Libutti. "So this gives us the ability to go into a more complete comprehensive project than we would if we had to fund it on our own. As you're starting your company and you're trying to establish those first customers it's really helpful to have the funding to lubricate that whole process for you."
Libutti said the EpiCast technology has already been demonstrated to be useful and operational in the laboratory, but now, thanks to the money provided by the fund, the company will be able to demonstrate the software's success on a real-life customer, which carries much more weight than a laboratory experiment.
Santa Fe based APJeT has developed laboratory-invented technology, Atmospheric Pressure Plasma Jet, or APPJ®, for the treatment of clothing fabrics, carpet and upholstery. The company's TextJet system, which can be used on fabrics made from polyester, silk, wool, rayon and other hard-to-process textiles, was built for APJeT's textile processing methods. APJeT's ability to make these fabrics hydrophobic (water repellent) on one side and hydrophilic (wicking) on the other side, in a single production step, is unmatched in the industry.
Furthermore, APJeT is believed to be the first company to deliver a durable hydrophobic treatment to the industry for heat-sensitive fabrics such as silk, wool and rayon. Just as important is APJeT's ability to provide these processes at a price that is below today's conventional treatment prices.
The company's next challenge was to adapt its TextJet system to accommodate variable width materials, such as the wider rolls of upholstery or thicker carpet. In order to develop a new machine capable of treating these fabrics as well, APJeT applied for funding and received $100,000.
"Before the award all we could do is performance apparel, which is a big market anticipated to be worth $4 billion by 2012," says Alex Padilla, director of sales and business development, "but if you look at the general import market for textiles and apparel in 2006, it is $91 billion—€”and that was just import."
Gary Selwyn, APJeT's founder and chief technical officer, says that the award will not only expand APJeT's market into industries they have been hoping to penetrate for years, but will also help them reach those markets sooner than if they had tried to fund the project on their own.
Northern New Mexico Connect will be releasing a request for 2007 Venture Acceleration Fund proposals by late summer or early fall. For more information, www.nnmconnect.net or www.lanl.gov/orgs/tt/vaf.shtml.
Krystal Zaragoza is a LANL communications specialist.

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