There's gold in them thar theses....

Rohit Khare (
Fri, 21 Nov 1997 20:33:20 -0800

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Subject: A PhD is a Terrible Thing to Waste

Financial services company Merrill Lynch offers "Innovation Grants" to
remake doctoral students into sharks by mining their dissertations for
business ideas.
(from Wired news:

A PhD is a Terrible Thing to Waste
by Austin Bunn

4:45am 21.Nov.97.PST
NEW YORK - It was only a matter of time before Wall Street figured out a
way to get the ivory tower to cough up some of that ivory. With the
creation of the Merrill Lynch US$150,000 Innovation Grants competition,
the tony financial-services company is looking to "unlock the commercial
value of research by PhD candidates around the world" by encouraging
students to mine their dissertations for business ideas, says Merrill
Lynch CEO David Komansky.
"FedEx started as Fred Smith's [undergraduate] thesis - which only got a
C+," Komansky said at a press conference on Thursday. "The PhDs represent
an undervalued asset from a business point of view. There are a lot of
reasons why doctoral students should think commercially about their work."

While not an explicit incubator for business proposals, the awards - worth
as much as $50,000 apiece - are clearly a chance for the billion-dollar
company to get first dibs on academia's only real product: good ideas.

Merrill, which is getting more aggressive in the tech field and just
opened a new Silicon Valley investment banking office, won't own the
winning ideas. The company claims it is not "approaching [the competition]
as a commercial venture," said Schrage. But the implications of the award
are clear. The entry form essentially asks the students to put together a
business proposal by describing "how to test the usability, utility, and
feasibility of the prototype ... under market conditions (in less than 500

The list of judges reads like a Who's Who of industry big-shots, including
New York Times technology writer John Markoff, Esther Dyson of EDventure
Holdings, celebrity venture-capitalist John Doerr of Kleiner Perkins
Caufield & Byers, Edward McKinley of Warburg, Pincus & Co., and Xerox
PARC's chief scientist, John Seely Brown. There are no academics on the

Candidates are asked to submit a precis of their dissertation through the
contest Web site and speculate on the potential market and technical steps
required for the creation of their product or service. The awards (one
$50,000, two $20,000, and an array of smaller grants) will be administered
by the Merrill Lynch Forum. (The Merrill Lynch Forum and Wired will
publish joint research findings in the magazine's December issue.)

Competition director Michael Schrage encouraged candidates from all
disciplines, including the arts, humanities, and social sciences, but when
asked about the potential "uses" of a history dissertation, Schrage
responded enigmatically, "Some will require more ingenuity than others - I
can imagine a project in 'statistical history.'" Those pursuing PhDs in
schools from business, law, and journalism are explicitly excluded from
the contest, along with any students who already have venture-capital
financing for their nifty ideas.

To qualify, the applicants must have completed their doctoral defense -
the final stage of a PhD program - between 1 January 1996 and 31 May 1997.
But with such a late deadline, Lynch is targeting the students least
likely to apply, says Columbia computer-science professor John Kender. "If
they want to grab onto students, the time to get them is their third year,
at the stage of the thesis proposal when the formal project is finished,"
he says. "By their sixth year, they could have been in private industry
already as much as a year."

In addition, the pool of entrepreneurial spirits in graduate programs is
small, because strong students with any business leanings forego PhDs to
enter the private sector immediately after getting their BAs, notes
Kender. Back in the '80s, "when it was popular to do so," about a quarter
of Columbia's PhD candidates in computer science started companies, said
Kender, but that number is now significantly smaller.

The creation of the new grants points, in part, to a larger laziness on
the part of businesses about doing research themselves, said Kender. With
industrial groups and the government committing less to their own
research, the Merrill Lynch grants offer a kind of shortcut to valuable
research findings. But universities have also recognized the lucrative
possibilities of cozying up with the private sector, evident in the recent
move by Columbia, Carnegie Mellon, and Cornell to open satellite offices
in the financial district.