A microfunding system for research and innovation

Among the many values of Twitter is the fact that I have run into some rather interesting people there. One of them is (and I use her Twitter ID), roguepuppet whom I got to know in the Twitterverse during SC07 which she was attending and I was not. Having given Twitter another plug, let me switch gears to the real reason for this post, her post on supporting the intellectual life. You’ve all heard me rail and rant against the current publish and perish system, and slightly less so against the whole ecosystem, especially in the life sciences of academic funding, academic to commercial ventures, biotech funding, etc. There are quite a few statements in the post that really got me thinking.

without research, we soon stagnate and falter

how do we support researchers who want to do cool things, without creating another bureaucracy that slows them down?

the current focus on ROI will prevent major funding agencies and large groups of people from supporting the sort of pure research that will take us to the next level.

She goes on to make suggestions about setting up funds along the lines of Feed the Children, or move to the DonorsChoose model, and she ends with this question

How would you model this so that good research could thrive without the tentacles of profit and ROI strangling it?

There is so much food for thought there, that I am not even sure where to start. First, let us acknowledge that our current funding system is broken. Second, I would extend the questions/challenges posed above, not just to pure research, but also the funding available to life science startups. The sheer risk associated with most biopharma efforts makes investment hard to find these days. It is a travesty that while cleantech is being funded up the wazoo (which is fine in itself), efforts in tropical disease, which kills millions today and will tomorrow are essentially reliant on the funding of organizations like the Gates Foundation (the one reason I don’t badmouth Bill Gates ever these days) and don’t get a fraction of the press. Perhaps worst of all, when investors do fund biotechs, they often don’t have the patience to see the process through to the end (the number of companies changing business models and emphasis mid-stream are dime a dozen).

However, I must disagree with Nan (our friendly neighborhood twitterer’s real, identity) that we need to remove tech research away from the tentacles of ROI. I would argue that one of the reasons that China and India are thriving in some areas today is because of the possibility of a big R, and given the origin of some of the best research especially in electronics and telecommunication over the past 50-60 years, and by companies like 3M, makes it difficult to argue against profitability as a source for innovation. However, I do agree that we need to look beyond traditional funding models, including government grants and VC funding if we want to really tap into the long tail of research innovation.

One of the first things I learnt about academia was that everyone was trying to game the funding system. Whether it was an NIH grant, or a DoD or DARPA grant, the language in the application and the real purpose was usually not the same. This is where I think the ideas presented in Nan’s blog post are worth a read. What really appeals to me is a system that combines a microfinancing system like Kiva (perhaps with a dash of DonorsChoose), with an innovation network like iBridge Networks. Under such a system, you have oversight and accountability. The onus is on people to find what they find relevant and interesting and on innovators, academic or commercial, to “sell” their ideas. The funding should hopefully be enough to bring an idea to life and get it to a stage where you can either license the IP or go after more funding, perhaps from more traditional sources. As a life scientist, one of the aspects of the whole web movement that has made me envious is the ease at which you can get something off the ground, as we did with Bioscreencast. Angel funding is also not hard to get and funding sources/incubation environments like YCombinator exist. Unfortunately the risk/reward issues and other factors, e.g. impatience with time to get returns) and the need to just publish, have really pushed back scientific research. So if we can empower innovators and researchers via a financing system that can allow you to run a small lab, develop proofs-of-concept, etc, it will be a great start.

The thoughts above tend to switch from academic research to early stage biotech, but I feel both suffer from complementary problems, problems that hinder innovation and cutting edge research, and the microfinance system described above provides a means for researchers and innovators to bring their ideas to fruition, either from a purely academic videopoint, or to commercialize a good idea. Do you think something like that is feasible? If not, why? I am not arguing to end current forms of funding, but to find alternatives, perhaps those that can be used by small groups of like minded scientists to perform Bursty Work.

Technorati Tags: Microfinance, Funding, Research