News - Enterprise Innovation Institute

Intelligent Power Amplifiers: Atlanta IC Developer VT Silicon Receives $3.3 Million to Develop WiMax Chips

Atlanta radio-frequency integrated circuit developer VT Silicon has received a $3.3 million round of financing from California-based Menlo Ventures. The Series A funding will help the company design and produce prototypes of its new “intelligent power amplifier” chips for the next-generation of WiMax mobile devices.

Based on silicon-germanium (SiGe) semiconductor materials, the VT Silicon chips will include patent-pending distortion-prevention techniques – known as linearization enhancement – that are designed to support the complex signals used by WiMax devices. To reduce chip costs to justify high-volume consumer applications, the company is building its amplifiers on low-cost SiGe instead of the more exotic – and costly – gallium arsenide (GaAs) materials used in most existing WiMax power amplifiers.

“This funding will allow us to take the linearization techniques we have already proven in a test chip and apply them to commercial chips within the next 9 to 12 months,” said Mike Hooper, VT Silicon’s CEO. “Our plan is to be shipping samples to customers early next year and to begin ramping to production by the middle of next year.”

VT Silicon is a member company of Georgia Tech’s Advanced Technology Development Center (ATDC).

WiMax is intended to provide significantly higher bandwidth and broader coverage for the next generation of mobile devices that will support such applications as streaming video. Sprint Nextel Corp. has already announced plans to roll out WiMax service in large metropolitan areas during 2008, and as a result, manufacturers are rushing to provide the special chipsets the devices need.

That will require some engineering innovation, as the new WiMax mobile devices will demand more power – but be less forgiving of the distortion caused by nonlinear effects that occur at higher power levels, Hooper noted. “They are going up on the complexity curve because they are trying to get more and more information into the same bandwidth.”

Meeting the technical demands in potentially high-volume devices will require new levels of optimization — in addition to new techniques for controlling distortion. VT Silicon has already developed one linearization technique, and is working on others.

“What you want to do is build a power amplifier that is more linear for higher power levels,” Hooper said. “That can give you more range, better battery life and compensate for other issues that you associate with higher performance. Since power amplifiers require a balance of power, linearization, efficiency and other factors, you have to optimize each of these for the specific application where they will be used.”

For its chips, VT Silicon has developed proprietary Linear Enhancement Technology (LET) that will permit the higher power levels. Because SiGe can support both conventional bipolar transistors as well as CMOS, the LET can be implemented on the same chip as the power amplifier, providing cost and design simplicity advantages.

“SiGe affords us the ability to put very sophisticated control and intelligence within the power amplifier because SiGe can combine both CMOS – which is low power control circuitry – and bipolar transistors in one fabrication process,” Hooper noted. “It gives us the ability to get fairly complex, allowing us to make intelligent power amplifiers.”

However, the designers will have to compensate for the relatively lower RF power levels currently produced by most SiGe power ICs. “We have some proprietary technologies to get the power we need,” said Hooper. “We can be competitive with gallium arsenide on power levels.”

The company initially plans to produce two power amplifiers for the WiMax market, operating at 2.5 GHz or 3.5 GHz. As a step toward volume manufacturing, it will work with customers to create a reference design for each prototype chip. Jazz Semiconductor Inc. of Newport Beach, Calif. will produce the chips.

Hal Calhoun, managing director at Menlo Ventures, is bullish on the future of the WiMax market – and VT Silicon’s solutions. “We believe that the leading-edge technology from VT Silicon will be very competitive in this fast-moving market,” he said. “The combination of silicon germanium and unique linearization techniques makes the company’s technology attractive to the key players in this new market.”

Hardware costs will be a significant issue in the success of WiMax, which is just one of the technologies vying for dominance in the next generation of mobile devices. “If the chipsets can be produced inexpensively compared to current WiFi devices, WiMax can supplant WiFi and become the leading technology for mobile broadband applications,” Hooper said.

The company’s most significant challenge, he added, is hiring enough RFIC engineers to meet its growth needs. VT Silicon is trying to hire four engineers in a very tight market for top professionals.

“The industry is rebounding, and RFIC engineers are hard to get,” Hooper said. “Atlanta is becoming a new growth center for semiconductor technology. We hope to create a bigger synergy in semiconductor development in the Atlanta area. We’ve got some very exciting new technologies and need smart people to help bring them to market.”

About VT Silicon: VT Silicon designs and manufactures multi-band radio frequency integrated circuit (RFIC) solutions for the mobile wireless broadband market. The company’s products leverage novel linearization and efficiency enhancement technologies that enable original equipment manufacturers, original design manufacturers and reference design houses to manufacture broadband, highly-efficient, low-cost and small-footprint modules and transceivers. For more information, please visit (www.vtsilicon.com).

About Menlo Ventures: Menlo Ventures provides long-term capital and management support to early-stage and emerging-growth companies. It is one of Silicon Valley’s oldest venture capital partnerships, and has organized and managed nine venture funds since its inception in 1976. The firm has more than $4 billion under management, and a team with more than 100 years of collective experience in technology, marketing, sales and general management. For more information, please visit (www.menloventures.com).

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, GA 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail: (john.toon@atdc.org).

Writer: John Toon

Georgia Tech Announces Minority Companies of the Year

As part of its annual Financial Roundtable Forum held on Aug. 22, the Georgia Minority Business Enterprise Center (GMBEC) recognized the winners of minority firms of the year in manufacturing, construction, service and technology. The winners were TechnoChem, LLC of Atlanta (manufacturer), ARS Mechanical, LLC of Conyers (construction), Caduceus Occupational Medicine of Atlanta (service) and Syntellus Dataworks of Atlanta (technology). ARS Mechanical also won regional minority construction firm of the year, beating out nominees in eight southeastern states.

TechnoChem provides electro deposition and powder coating for the automotive, industrial and aerospace industries; ARS Mechanical is a heating, ventilation, and air conditioning (HVAC) services firm; Caduceus Occupational Medicine provides medical management services related to occupational health; and Syntellus Dataworks is a technology solutions provider.

Lord and Dominion, a corporate housing and relocation company that landed a $3 million contract with the U.S. Department of Housing and Urban Development shortly after becoming a GMBEC client, was also recognized at the Aug. 22 event with the Minority Business Development Agency Regional Director’s Award.

“This is a tremendous honor for not just the winning companies, but for all Minority Business Enterprises (MBEs),” said Donna Ennis, GMBEC project director. “These companies have worked hard to be successful and are leaders in their industries. I hope this award stands as a symbol of encouragement to all minority business owners to embrace the challenge and help mentor and encourage smaller MBEs.”

The recognition was part of the 25th anniversary of Minority Enterprise Development (MED) activities. MED Week celebrates the achievements of the minority business community and honors outstanding minority business leaders every year who excel in their field of business and demonstrate excellent leadership at the local, regional or national level. Winning firms were chosen based on economic impact, job creation and community leadership.

Approximately 150 participants at GMBEC’s third annual Financial Roundtable Forum learned how to develop successful growth strategies and had the opportunity to hear from CEOs of high-revenue firms such as Steve Ewing of Wade Ford, Woodrow Hall of Diversapack, Rory Sanderson of Sanderson Industries, and Mark Wilson of Ryla Teleservices.

GMBEC’s mission is to provide business and technical assistance that helps emerging and existing minority businesses experience significant growth and sustainability and have a long-term economic impact through the creation of jobs and revenue.

For more information on MBE services offered by Georgia Tech’s Enterprise Innovation Institute, contact Donna Ennis (404-894-2096); E-mail: (donna.ennis@innovate.gatech.edu).

About Enterprise Innovation Institute:
The Georgia Tech Enterprise Innovation Institute helps companies, entrepreneurs, economic developers and communities improve their competitiveness through the application of science, technology and innovation. It is one of the most comprehensive university-based programs of business and industry assistance, technology commercialization and economic development in the nation.

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail (john.toon@innovate.gatech.edu).

Writer: Nancy Fullbright

SparkIP: Creating an Online Community and Exchange for Intellectual Property

Startup company SparkIP, which was recently accepted into Georgia Tech’s Advanced Technology Development Center (ATDC), wants to be the “eBay of intellectual property” and the “myspace of science” for universities and government labs. The goal is to efficiently connect buyers and sellers of intellectual property via a single Web destination.

According to CEO Ed Trimble, global licensing of intellectual property (IP) is a $100 billion per year market, and continues to grow. From 1997 to 2005, annual investment in research and development in the United States increased from $239 billion to $289 billion, and annual filings at the United States Patent and Trademark Office increased by 80 percent. As a result, a cottage industry has emerged of IP strategy firms and acquirers/developers.

“In the United States we have outsourced our manufacturing and more and more of our services jobs. We have to ask ourselves what we have that keeps America competitive, and it’s innovation. All countries want to become knowledge-driven,” Trimble observed. “That being said, the market for innovation and intellectual property is incredibly inefficient, built on disorganized processes, systems and personal relationships.”

Through patented research tools and a first-of-its-kind data repository, SparkIP is offering a one-stop shop for inventors, attorneys, licensors and licensees to realize dramatic gains in the creation and commercialization of new technologies. This science community will include advanced research tools, automation of IP development and patent protection processes, invention and research requests, community tools to enhance communication and collaboration, standardization of licensing terms and contracts, funds transfer and premium data services.

“Our engineering team is diligently working on two parts of our offering. On one side, we have SparkstreamSM, a Web-based tool that helps universities capture invention disclosure forms (IDFs), identify bundling opportunities, communicate and collaborate with other researchers and tech transfer offices, market inventions on the SparkIP exchange and manage and report on their invention pipeline,” Trimble explained. “Our other offering is the SparkIP public marketplace, or Exchange. Here, technology buyers can research innovation, file invention and research requests, bid on exclusive first-view of new technologies and contact the licensor to initiate licensing discussions.”

SparkIP’s offerings are different from others on the market, said Trimble. The patent-pending database and research tools provide an innovation landscape that users can visually navigate to discover new technologies, bundling opportunities among existing technologies and industry research needs. Trimble also pointed out that the first-view rights gives buyers a competitive advantage in the market and the client interface allows users to access information and transactions efficiently.

Early on, SparkIP will target universities for its products. According to Trimble, the three main constituents – faculty inventors, technology transfer offices and buyers – are all frustrated by ineffective marketing, fixed budgets, trouble assessing viability of ideas and difficulty finding desired IP within the university environment. In essence, SparkIP’s products will allow the marketplace to determine the value of IP generated by universities.

Another reason SparkIP will focus on universities is the opportunity for improvement in the commercialization and licensing process. Today, annual license revenue for American universities is about three percent of annual government and corporate research and development investment in those universities. In comparison, corporations like Texas Instruments, IBM and DuPont generate out-licensing revenue between eight and 14 percent of research and development investment – a number which represents the leftover, non-strategic innovation and ignores the more than 500 percent return in the form of core product revenue resulting from research and development investment.

“Maximizing revenue is not the sole mission of universities, so that number is never going to be what it is in corporations. However, everyone agrees that there is a lot of opportunity to lift these numbers,” Trimble said. “Our experience and relationships are strongest within American universities, and we have the ability to create an attractive and predictable pipeline of innovation for the buying community, which includes corporations, private equity firms, technology incubators, entrepreneurs and even other research organizations.”

Initially, universities and government labs will be able to post their innovations on the Exchange free for one year to accelerate adoption and build critical mass; Sparkstream will be deeply discounted for one year. Eventually, revenue will be derived from commissions on upfront license fees, auctions for exclusive first-view of new innovation and fees for submission of invention and research requests. The Sparkstream co-branded university Web sites will also generate revenue through license fees and patent services.

“Our objective is to have 500 or more exchange listings by our October launch, 1,000 listings by the end of the year and 2,900 by the end of 2008,” Trimble said. “If we hit these numbers – and we think we can – this will be a very valuable business by 2012.”

Trimble also stressed that ATDC would be the perfect place from which to launch SparkIP.

“We’re excited about the midtown location, the facilities, the support services and the proximity to one of the top research institutions in the country. But we’re most excited about joining such a great community of people,” he said. “Everyone I’ve known here is so vibrant and energetic, and we look forward to enjoying that energy as well as contributing to it.”

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail: (john.toon@innovate.gatech.edu).

Writer: Nancy Fullbright

IVOX: Gaining Traction in the Risk Assessment Industry

High-risk drivers are the number one concern of safety managers. From a financial perspective, that certainly stands to reason: 80 percent of insurance claims are generated by the worst five percent of the driver pool, and truck accident lawsuits settle for as much as $10 million. These are just a few of the issues being addressed by information services company IVOX, the newest member of Georgia Tech’s Advanced Technology Development Center (ATDC).

IVOX uses an innovative, patent-pending algorithm to calculate driver ranking information. Similar to a credit score that assesses financial risk, IVOX’s DriverScore® assesses a driver’s accident risk – information that can be used by commercial trucking fleets and the insurance industry to better manage risk.

“Driver behavior data is derived from the global positioning system accelerometer boxes that are installed in trucks and cars, and the data is processed through a patent-pending, risk-weighted algorithm to determine the DriverScore,” explained Gregg Warren, founder and CEO of IVOX. “We have the ability to assess data at a granular level – both for intuitive and non-intuitive risks – and the capacity to predict specific driver behavior.”

The timing is right for a company like IVOX, since commercial fleet accidents are a $300 billion-a-year problem. In addition to insurance claims and regulatory fees, lost productivity impacts the entire economy. Most importantly, Warren wants his product to save lives by improving highway safety.

“DriverScore incorporates elements such as speeding, aggressive driving, time of day and route risk. The score is like a golf score – the higher the score, the worse the driver,” Warren noted. “In the commercial trucking industry, there’s a lot of data, but not a lot of information. Our product allows that data to be utilized in an effective way.”

IVOX directly targets large commercial self-insured fleets and insurance companies for both personal vehicles and commercial fleet clients. By 2012, Warren projects that IVOX’s potential market will be worth more than $5 billion.

Already, IVOX is creating buzz. The company won a business launch competition last May sponsored by the Georgia Research Alliance and the Technology Association of Georgia. The grand prize was $100,000 cash and a service package worth nearly $200,000.

“We were gratified by the win, but also feel a responsibility,” said Warren, who developed the idea for IVOX from his years of consulting to the wireless and financial services industries. “We want to drive demand and let the transportation industry know that all of these issues impact line item cost.”

IVOX delivers its product via the Web, and its revenue model includes monthly monitoring fees (generally $15 to $20 per vehicle), implementation fees and consulting fees. Warren projects that a large portion of IVOX’s later term business revenues will come from licensing agreements.

“There is no national claim database. State departments of transportation can tell you how many crashes there are at a particular point, but that doesn’t mean it’s a high propensity for accidents,” he said. “We have to normalize it for traffic and class of road on a state-by-state basis. It’s more laborious, but it has to be done that way to accurately assess risk.”

According to Warren, IVOX’s competitors include pay-as-you-drive insurance companies, video-based accident reconstruction companies, device-based companies that sell the GPS accelerometer boxes and consultants. However, he said there are no competitors thinking about the intellectual property around risk assessment like IVOX.

“We’re constantly thinking about risk and what impacts it. No one else can replicate this – they’ll have to license it from us,” he explained. “We have the ability to marry GPS and GIS data with risk assessment. The goal is to have a smart learning data model, so when accidents do occur, we can become smarter about it and adapt and develop new algorithms.”

IVOX recently signed an agreement with a top 10 property and casualty insurance company and has an agreement in principle with one of the top two fleet finance companies – two proposals totaling 9,000 commercial vehicles. Already, there are 15,000 vehicles in IVOX’s database.

“In the near future, we want to close five to six million dollars in funding and roll out our products and services,” Warren said. “We have a conceptual product that works, but to make it truly work we have to match the scale of our demand.”

Warren, who expects to employ 18 people by the end of this year and 47 by the end of 2008, says this is an exciting time for IVOX.

“We’re excited about being in Atlanta. We can draw from Georgia Tech’s Ph.D. program in GIS and GPS, Georgia State’s graduate-level program in actuarial science and mathematics and statistics programs at Emory, Georgia State and Georgia Tech,” he noted. “We think that we can be the next great technology company that Georgia can hang its hat on.”

IVOX is also proud to be an ADTC company: “The ATDC has a strong history of nurturing technology startups in Georgia, and we look forward to learning from their experience and leveraging the many resources the ATDC has to offer IVOX,” said Warren.

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail: (john.toon@innovate.gatech.edu).

Writer: Nancy Fullbright

Machine Tool Builder Rallies Back from Import Competition

AR-web — Todd Herzog, founder of Accu-Router, shows SETAAC Director Marla Gorges some of the machine parts inside a CNC router.

When Todd Herzog founded Accu-Router in 1992, his single biggest market was manufacturers of upholstered furniture. The Morrison, Tenn.-based company assembles high performance computer numerical control (CNC) routing systems and premium high-speed spindles used to cut materials for industries as varied as upholstered furniture, power boating, aerospace, automotive plastics machining and office furniture.

But between 1994 and 2001, the Chinese furniture industry increased exports by a staggering 335 percent, replacing Italy as the world’s largest furniture exporting country. In 2001, China’s furniture industry reported $2.8 billion in exports, 50,000 manufacturers and 50 million workers. Between 2000 and 2003, the value of domestically produced furniture declined by more than $5 billion.

“Even dependable names in upholstered furniture aren’t as prosperous as they were. If you’re not importing from China or Vietnam, you better have your costs in line with those who are, or you’re going to get beaten up,” Herzog warned. “Accu-Router went through a difficult financial period between 2002 and 2005, and we documented substantial losses in business as a result of deep price cutting from Japanese and Chinese competitors.”

That’s when Herzog learned about the Southeastern Trade Adjustment Assistance Center (SETAAC), based at Georgia Tech’s Enterprise Innovation Institute in Atlanta. Serving the eight-state region of Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina and Tennessee, SETAAC helps manufacturers develop and implement turn-around strategies to better compete with imports.

Marla Gorges, director of SETAAC, conducted an initial review of Accu-Router and helped the company prepare an application for the U.S. Department of Commerce. Once the company was accepted for the first level of funding, SETAAC Project Manager Mark Hannah developed an adjustment plan that included projects to receive funding support. He and Gorges also answered questions, provided advice and handled the paperwork flow.

“In the case of Accu-Router, we checked the plan for soundness and helped Todd push his agenda through,” she recalled. “Todd really knew marketing-wise what he wanted to do – he knew he had to diversify.”

Accu-Router has now realigned its target markets to focus on the boating industry and the remanufacturing market. Boat manufacturing does not have the foreign competition that the furniture industry does, and no one else in the routing business is focusing on remanufactured machines, according to Herzog.

“Remanufacturing for us has created a whole new market – either for existing customers or for customers who want to reach our product but don’t have the money to reach all the way to a new product,” he noted. “We can tell a customer that they can buy a machine and as we develop new technology, we can add that or we’ll take it back in a trade. We’ll have a business relationship the whole way rather than them just buying a machine, and we like that.”

Herzog said that it makes sense to focus on the boating industry due to the sheer number of manufacturers. According to the National Marine Manufacturing Association, there are 440 boating-related manufacturers in the United States. Accu-Router, which has a total of 17 employees, has sales representatives designated specifically for the boating industry.

Typically, companies that are involved in the SETAAC program receive assistance in marketing consulting, manufacturing improvements, information systems improvements, employee training and maintenance and quality systems improvements. Over the past two years, SETAAC has helped Accu-Router revamp its marketing materials, both in print and online.

“We have replaced and added to our printed sales literature, created new national ads, updated and expanded our company Web site and participated in national trade shows. We have a new spindle catalog that did not exist before, and we also developed video-on-demand for our Web site – a major company strength from a competitive point of view,” Herzog said. “We could not have tackled this large an undertaking on our own.”

Herzog also said that the arsenal of new marketing services is helping Accu-Router to rebound, noting that the Web site is generating meaningful new prospect leads. The company’s number of inquiries has dramatically increased over the past four months compared to prior sales periods.

“We’ve been able to magnify everything we’ve done through this grant program, and to survive you have to beat everyone else to the customer,” Herzog remarked. “Those who can’t play that progressively are going to be left by the wayside. There’s no room for mediocrity and there’s no room for non-competitiveness.”

Firms that are accepted into the SETAAC program pay for 25 percent of the diagnostic visit and report. The government generally pays half of the cost of project implementation for activities to benefit the company. Private sector consultants submit quotes for implementing the identified projects and are chosen by the company to execute the outlined changes.

Last year, SETAAC helped more than 30 companies. On average, these companies received $42,000 in matching funds. In the last three years, SETAAC’s overall client base has increased sales by 26 percent and improved productivity by 28 percent.

About the Enterprise Innovation Institute:
The Georgia Tech Enterprise Innovation Institute helps companies, entrepreneurs, economic developers and communities improve their competitiveness through the application of science, technology and innovation. It is one of the most comprehensive university-based programs of business and industry assistance, technology commercialization and economic development in the nation.

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail (john.toon@innovate.gatech.edu).

Writer: Nancy Fullbright

Orthotics Company Regaining Its Competitive Edge

In 1992, Karen Bonn left behind a nursing career to start a company that manufactures restorative splints and braces in Brandenburg, Ky. She began Restorative Medical in her basement and funded the business with her husband’s retirement savings and a second mortgage on her home.

“While working as a director of nursing in a long-term care facility, I was disheartened at the limited and inappropriate selection of orthotics available for restorative type patients,” she recalled. “While most of the medical community still thought these types of disabilities were inevitable and not able to be corrected, I decided to design my own braces.”

Orthotics are custom-made appliances that stabilize and protect fragile joints and can also keep a joint properly aligned to improve functioning. The splints and braces that Restorative Medical manufactures treat patients who, due to illness or injury, are unable to relax their muscles. Although the organelles in the muscle tissue are still active, the relaxation message is not received from the brain and the body ends up in a hyper extensive mode, twisted and deformed.

As president and CEO of the eight-employee company, Bonn said that she often relied on word of mouth to market the company’s products. Such success can be short-lived when competing in the global marketplace.

“We’re trying to figure out how to make an impact on the world, and we struggle,” she admitted. “Our biggest competitor, a firm in Costa Rica, cut its price to the absolute bottom, so we had to lower our price and fight very hard to stay in business.”

To address some of her concerns, Bonn began working with specialists from the Southeastern Trade Adjustment Assistance Center (SETAAC), based at Georgia Tech’s Enterprise Innovation Institute in Atlanta. Serving the eight-state region of Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina and Tennessee, SETAAC helps manufacturers develop and implement turn-around strategies to better compete with imports.

“If a company’s sales and employment are down as a result of imports, it probably qualifies for the program,” said project manager Mark Hannah. “We conducted an initial review of Restorative Medical, and helped them prepare an application for the U.S. Department of Commerce. Once they were approved for the first level of funding, we developed a diagnostic and adjustment plan in order to address issues to help the firm improve its competitive position.”

Firms that are accepted into the SETAAC program pay for 25 percent of the diagnostic visit and report. The government generally pays half of the cost of project implementation for activities to benefit the company. Following the diagnostic and adjustment plan, Hannah had private sector consultants submit quotes for implementing the identified projects. Bonn then selected the consultant and together they implemented the changes.

Typically, companies that are involved in the SETAAC program receive assistance in marketing consulting, manufacturing improvements, information systems improvements, employee training and maintenance and quality systems improvements. SETAAC helped Restorative Medical with developing a DVD that could be used for marketing purposes and for training nursing home and health care personnel.

“The DVD will be an awesome thing for the future of our company and our marketing efforts,” noted Bonn. “The ultimate goal is to send the DVD for training purposes instead of having to get on a plane to explain the products to someone.”

Another area in which Restorative Medical received assistance was the patent of a new product, Hyper Hands. This brace helps to treat typical conditions like neurological tone, arthritis and ulnar drift, in which the fingers all bend toward one side of the hand. Bonn said the assistance she received from SETAAC was critical.

“We could not have afforded to submit a patent for a new product without the assistance of SETAAC,” she said. “Our representative was wonderful to keep in touch, aware of deadlines and very organized.”

Bonn said she expects additional jobs to be created in the future, once sales have taken off from the company’s marketing efforts. Currently, she is applying for the next phase of funding available through the SETAAC program.

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail (john.toon@innovate.gatech.edu).
Writer: Nancy Fullbright

Newnan Aluminum Extruder Implements Lean, Increases Productivity

bonlalum-web — Rick Miller, process optimization manager with Bonnell Aluminum, discusses the impacts of the lean implementation with Georgia Tech’s Jennifer Trapp-Lingenfelter and Derek Woodham.

As process optimization manager for the William L. Bonnell Co., a full-service aluminum extruder and a division of Tredegar Industries, Rick Miller saw first-hand the effects the recent slump in home building has had on the Newnan, Ga. plant that makes products as varied as hurricane shutters, tub and shower fixtures, louvers and vents.

“Bonnell serves a lot of customers in the commercial and residential building and construction markets. The Newnan plant is particularly tied to residential building so when the housing market slows down, it slows down Newnan’s business,” he said. “Last year we were in a bit of a crisis mode, and started looking for outside assistance.”

That assistance came from David Apple, northwest Georgia region manager for Georgia Tech’s Enterprise Innovation Institute. According to Miller, Apple was a real cheerleader for lean manufacturing principles, a process management philosophy derived mostly from the Toyota Production System and known for reducing wasted time and effort to improve overall customer value.

“Historically when we’ve had high volume, we could usually make decent money, but the real problem was the cost creep of utilities, labor rates, benefits and other costs,” Miller recalled. “In a year where we had all the volume we wanted, we still didn’t make much money. That’s what showed us we needed to do something.”

In February 2006, Georgia Tech lean specialists Jennifer Trapp-Lingenfelter, Derek Woodham and Tom Sammon conducted an assessment at Bonnell, and led initial training for management. Miller said that it was important to have external people be a part of the project since they can bring a different perspective and challenge the status quo.

According to Miller, the A1 packaging area was the most complex and offered the most opportunity for improvement. The team developed a value stream map and standardized the layout of equipment to improve the process flow — not only of product but of people as well.

“We’re always focused on machine utilization and automation, but Derek, Tom and Jennifer didn’t even look at machine pace or speed while they were in here — they were looking for waste,” Miller said. “I used to think the best we could do was incremental improvement, but there’s a lot of opportunity out there.”

Some of the waste observed in the A1 packaging area included an imbalance in production between extrusion, anodizing and packaging; multiple schedules; scrap and quality issues; and disorganization of work in progress.

“There was no flow through the packaging line, and that was a problem in terms of ergonomics and safety. There was excessive walking, excessive material handling and underutilized space,” remembered Trapp-Lingenfelter. “It was our goal with this project to educate all levels of the organization about lean tools, develop a culture of continuous improvement and assist in achieving a cost reduction plan.”

In addition to the introductory training on lean principles, other projects included multiple kaizen projects to improve product flow, reduce work in process, develop standard work, and incorporate 5S (sort, straighten, shine, systemize and sustain), point of use storage and visual controls.

As a result of the lean implementation, Bonnell has achieved outstanding results. The A1 packaging line has experienced an 18 percent increase in productivity since early 2006, and this steady increase in productivity has spanned high- and low-volume business cycles and different staffing levels. Those productivity improvements have reduced the annual operating costs by $330,000. Work in process levels have been slashed by 200,000 pounds on the floor, resulting in
a $350,000 reduction in working capital.

“The first hurdle was like being underwater and being unable to breathe. But once we get some oxygen, we’re going to figure out how to grow this business. If we’re not growing and increasing shareholder value, what are we doing?” asked Miller. “If we can demonstrate that we’re really good at what we’re doing, it may open us up to new opportunities such as minor fabrication that our customers would like for us to do.”

Bonnell is not merely interested in its bottom line, however. In an effort to make the Newnan plant the preferred place to work in the region, the company conducted a survey to reduce turnover and absenteeism among employees. The seven aspiration statements that resulted from the inquiry included: facility upgrade/facelift, effective shift schedule, leadership training, staffing to full-time process, team member development, family atmosphere and better pay through incentive recognition.

“This is the sign we’re always looking for. If we’ve got people thinking on their own, that’s when the company is starting to become a lean organization,” explained Woodham. “We’ve got to get more converts out there and you get converts by doing projects.”

One such convert was Louis Bell, anodizing manager for the Newnan plant. He said the biggest overall improvement has been being able to keep material flowing through the department without stopping. He also noted that the decreased congestion has also decreased the injuries recorded: last year there were 12 injuries whereas the year before had 24.

“It’s been a learning experience for everybody. It’s sometimes hard to see that it’s actually going to work until you try it,”said Bell, who is described as a “poster child for lean” by Woodham and Trapp-Lingenfelter. “Knowing that it’s my idea, I have to make it work.”

About Enterprise Innovation Institute:
The Georgia Tech Enterprise Innovation Institute helps companies, entrepreneurs, economic developers and communities improve their competitiveness through the application of science, technology and innovation. It is one of the most comprehensive university-based programs of business and industry assistance, technology commercialization and economic development in the nation.

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail (john.toon@innovate.gatech.edu).

Writer: Nancy Fullbright

Vidalia Hospital Implements Lean, Increases Efficiency

070601R055 — Alan Kent, president and CEO of Meadows Regional Medical Center in Vidalia, Ga., was a champion for implementing lean principles in the hospital’s emergency department. Photo by Gary Meek

Emergency rooms in the United States aren’t known for their efficiency. Data from the Centers for Disease Control and Prevention (CDC) shows that the 110 million people who visited an emergency room in 2004 spent an average of 3.3 hours from check-in to physician visit to discharge.

American emergency rooms are not just inefficient, they are facing a crisis. Most ER visits are made by the elderly or the uninsured at a time when the number of hospital emergency departments has been cut by 14 percent. Other CDC statistics show that ER visits by adults aged 22 to 49 increased 19 percent while visits by Americans aged 50 to 64 grew 15 percent.

Peggy Fountain, director of the emergency department at Meadows Regional Medical Center in Vidalia, Ga., is all too familiar with these issues. At one point, the average length of stay for her emergency department patients soared to more than 200 minutes, well below the national average, but still unacceptable to Meadows’ management.

“We had issues with bottlenecking, turnaround times, decreased satisfaction and overworked nurses,” she recalled. “One day, our president and CEO, Alan Kent, asked if I would be interested in having Georgia Tech assist us. Working here 24/7, there may be things that need to be changed that I can’t see but an outsider could.”

With funding from the Georgia Rural Economic Development Center (GREDC) at East Georgia College in Swainsboro, lean specialists with Georgia Tech’s Enterprise Innovation Institute conducted a three-day lean overview workshop and value stream mapping event with Meadows’ emergency department in June 2005. In addition to Fountain and Kent, workshop participants included the ER nursing staff, an ER physician, the radiology director, laboratory manager and business office staff.

“You shouldn’t ask your employees to do something you’re not willing to do yourself. How will you know where to deploy resources if you don’t learn about the opportunities themselves?” asked Kent. “The engagement of senior management is critical to any significant organizational change.”

Frank Mewborn, the Georgia Tech lean specialist who led the events at Meadows, agrees with Kent’s assessment. “It is important to involve top management as well as those who are in the trenches every day,” he noted. “The first day of training we had about 20 people across all departments, and about 12 participated when we actually did the value stream mapping.”

The lean team at Meadows developed 44 action items for reducing lead time to admit, treat and discharge a non-critical ER patient, 18 of which were determined to be low-cost and high-impact. The ideas fell into one of seven categories: 5S and visual controls, cross-training, equipment, hospital procedures, patient information, general procedures and staffing. 5S — which stands for sort, straighten, shine, systemize and sustain is a philosophy and a way of organizing and managing the workspace so morale and efficiency are increased.

“Our Pyxis system — which is an automated mobile supply station that we pull supplies from based on a patient’s name — were all set up differently,” Fountain said. “Now they are all standardized so they contain the same general supplies in the same place, and that has helped nursing a lot.”

Other changes that were made included labeling racks, trays and drawers; installing a color-coded flag system outside patient rooms; issuing patients red allergy armbands to alert medical staff; and adding a holding area for patients who need to see a doctor but don’t need a room. Fountain also touts the implementation of the T System , a software program specifically designed for the emergency department that is able to interface with other software systems used throughout the hospital.

Integrated with the T System is a large, plasma screen monitor in the nurses’ station that can show staff who is in the waiting room, who needs an X-ray and who can be put into a room or a wheelchair. The T System also documents length of stay, lab tests ordered, physician and nurse assigned to the patient and discharge disposition, as well as patient name, room number and prior ER visits, if applicable.

Meadows has also created incentives for its emergency department staff for meeting the stated goal of 110 minutes length of stay. Timers set to 30-minute increments are activated once patients come in the door, and a team of nurses assist with getting IVs started, providing respiratory assistance or monitoring them with an EKG. Already, the emergency department staff has met that goal on numerous occasions.

“After the value stream mapping exercise, we had about 75 sticky notes posted on a wall that signified different changes that needed to be made,” Kent remembered. “As those ideas were implemented, the staff would cross them off and move them to another wall. Over a period of months, I saw those 75 notes drop to about 20. About half of the items in there were low or no cost.”

As a result of the lean health care implementation, Meadows has realized outstanding results. Physicians, on average, are seeing more patients per hour than before the lean implementation. In 2005, average length of stay per patient was 247 minutes; thus far in 2007, it is 139 minutes — an astounding 43.7 percent reduction. That success is reflected in patient satisfaction numbers as well: approximately 92 percent of patients reported that “Overall, I am pleased with the quality of care provided at this facility.”

“We’ve grown our business overall by 10 percent while reducing our turnaround time, which in an emergency room relates almost directly to patient satisfaction and willingness to come back as a repeat client,” noted Kent, a 1979 health systems graduate of Georgia Tech. “It also has improved work life for participants so turnover is lower. We ended up with some good cross-training opportunities and more of a team environment in the ER now.”

Fountain also points out that emergency room staff is more empowered to take initiative and make changes that could positively impact their work process.

“Staff members realize that it’s not just the ER’s problem it’s everyone’s problem. Whatever we can do to improve the process makes everyone’s job easier,” she said. “Walking into this ER is stressful enough you don’t need to walk in stressed out about the process part of it, in addition to what you’re going to see that day.”

Meadows’ management plans on utilizing lean health care principles when it builds a new, state-of-the-art hospital. The original facility, built in 1963, employs 600 people and operates 87 beds as well as a 35-bed nursing home, an eight-bed outpatient facility, and one part-time and two full-time operating rooms.

“We want to design the new facility using lean processes before architects draw up the building,” said Kent, who also plans to incorporate online patient registration, self check-in kiosks and bar-coding into the new hospital. “We’ll draw a building around the parameters of the number of ER visits, OR visits, square footage needed, beds needed, budget, et cetera. We want to optimize process before we draw the first line. We want form to follow function.”

Jack Bareford, GREDC director, believes Meadows’ success can be replicated in other rural Georgia hospitals. GREDC focuses on economic development issues that build economic strength and develops innovative, practical strategies that prepare rural communities to prosper.

“Rural health care is one of the most important issues in successful economic development, and communities that have access to good health care can survive and grow,” Bareford said. “With the many challenges there are to rural hospitals, such as care for the uninsured, reliance on lower-paying publicly-funded insurance plans, skyrocketing liability costs and shortages of health care professionals, the lean health care model can save time and resources to help hospitals remain healthy.”

Kent agrees that Meadows’ approach could be successful in other hospitals, but notes that change is often difficult, especially in health care.

“In health care, we live in these little silos. People should be hovering over us asking how we implemented lean. Success in the past does not necessarily ensure success in the future. If you don’t change and innovate, it will kill you,” Kent noted. “One of the goals of lean health care is to awaken a new level of thinking and introduce manufacturing approaches that have been proven to produce excellent efficiency and profitability.”

About Enterprise Innovation Institute:

The Georgia Tech Enterprise Innovation Institute helps companies, entrepreneurs, economic developers and communities improve their competitiveness through the application of science, technology and innovation. It is one of the most comprehensive university-based programs of business and industry assistance, technology commercialization and economic development in the nation.

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail (john.toon@innovate.gatech.edu).

Writer: Nancy Fullbright

Vivonetics: Enabling Drug Discovery and Disease Diagnostics Through Tiny Molecular Beacons

Vivonetics is bringing several Georgia Tech technologies to market that could dramatically change drug discovery process and disease diagnosis. The company, which was recently accepted into the Advanced Technology Development Center (ATDC), is developing and commercializing nano-scale sensors called molecular beacons.

“Our molecular beacon technologies provide a novel way to detect gene transcripts in live cells. Such an invention may be used to measure biomarkers, which are used to assess a patient’s disease state and thus provide vital information with regards to how well a patient is responding to a drug regimen,” said Thanh Doan, director of business & research development for Vivonetics. “Molecular beacons can also be applied to drug discovery. For instance, a drug that turns on a gene can be discovered by looking at the amount of light emitted by the molecular beacons in living cells.”

A molecular beacon is a hairpin oligonucleotide probe that fluoresces when it binds to a target RNA molecule. Vivonetics uses two technologies – dual FRET molecular beacons and peptide-linked molecular beacons – developed in the laboratory of Gang Bao, a professor in the Wallace H. Coulter Department of Biomedical Engineering at Georgia Tech and Emory University. These technologies offer improvements over what is currently in use through its specificity, signal-to-noise aspect and its unique application for cells and tissues. Company officials say this is a key advance for detecting specific genes in living cells.

The company was founded in 2003 by Bao and Karim Godamunne, a VentureLab fellow. Vivonetics has already received Small Business Technology Transfer Program (STTR) Phase 1 and Phase 2 grants from the National Cancer Institute totaling more than $1.8 million. Other funding has come from Georgia Research Alliance and VentureLab.

The market is right for a company like Vivonetics. Of an estimated $682 billion in revenue reported by the global drug development industry, $126 billion was generated within the biotechnology sector for 2006. The in-vitro diagnostic market reported $21 billion in revenue (2003) with $2.2 billion specifically in molecular diagnostics. The areas in which Vivonetics is working – infectious diseases, immune disease, cancer and hematology – account for 36 percent of the pie.

“We can create drug discovery research tools with this technology that assess genetic transcripts, screen for drugs in living cells, assess levels of toxicity and isolate characterized cells and tissues,” Doan said. “This will be of great value to the pharmaceutical industry.”

Vivonetics will also market diagnostic kits that can detect biomarkers in clinical samples. According to Doan, existing in-vitro diagnostics are limited by turn-around time, sensitivity, availability of commercial probes and non-standardized methods.

Vivonetics is located on the Georgia Tech campus in the ATDC Biosciences Center. The company plans to use its startup time to build relations with academic and pharmaceutical experts for its research programs, such as cancer, cardiovascular diseases, viral infection and stem cells.

“During this initial phase, we are optimizing our core technologies while understanding the ins and outs, the advantages and disadvantages, to applying the technique,” Doan said. “We will develop molecular beacon assays and hence commercialize our technologies. The academic research community is just now beginning to use it, and in another five years or so, pharmaceuticals will adopt our technologies.”

Vivonetics expects to be manufacturing and distributing diagnostic kits and research tools and assays to customers within the next five years. It is anticipated that the company will take off exponentially once its products are validated and others begin using it.

Doan expects that Vivonetics’ association with ATDC will help propel the company to the next stage: “It is important for us as a young company to be able to tap into the experts within ATDC, whether it’s in venture capital, marketing or sales. We will be able to access the local and state community for fundraising and networking opportunities without having to reinvent the wheel.”

Vivonetics is a graduate company of VentureLab, a one-stop center for technology innovation that provides comprehensive assistance to Georgia Tech faculty members, research staff members and graduate students who want to form startup companies to commercialize innovative technology. Formed in 2001 and part of Georgia Tech’s Commercialization Services, VentureLab builds on more than 25 years of experience at the ATDC.

About the ATDC: The Advanced Technology Development Center is a nationally-recognized science and technology incubator that helps Georgia entrepreneurs launch and build successful companies. ATDC provides strategic business advice and connects its member companies to the people and resources they need to succeed.

More than 110 companies have emerged from the ATDC, including publicly-traded firms such as MindSpring Enteprises – now part of EarthLink. Headquartered at Technology Square on the Georgia Tech campus in Atlanta, ATDC has been recognized by both BusinessWeek and Inc. magazines as among the nation’s top nonprofit incubators. Since 1999, ATDC companies have attracted more than a billion dollars in venture capital funding.

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail: (john.toon@innovate.gatech.edu).

Writer: Nancy Fullbright

Companies from Georgia Tech’s Science & Technology Incubator Attract $1 Billion in Venture Funding

Companies associated with Georgia Tech’s science and technology incubator have raised more than a billion dollars in venture capital since 1999 – and in 2006 accounted for 10 of the top 25 venture deals in Georgia, including the two largest.

The incubator, the Advanced Technology Development Center (ATDC), has turned out 112 science and technology companies since 1986 – including 31 that have been represented on the public markets through IPOs or acquisitions.

At a May 10 event held to showcase the incubator’s companies, ATDC “graduated” six early-stage firms – three Internet companies, two semiconductor firms and a developer of homeland security technology. Together, those six early-stage firms raised more than $50 million while in the incubator.

“ATDC is a source of exciting deal flow, and we have invested in many ATDC companies,” said Fred Sturgis, managing director of Miami-based venture capital firm H.I.G. Ventures, a $4 billion fund. “ATDC attracts leading entrepreneurs in Georgia and increases the probability of success for its companies.”

The billion dollars raised by ATDC companies included 160 deals in 75 companies from 138 venture investors. The average deal size was $6.7 million, though funding amounts varied, with 32 companies raising less than $5 million and 10 raising more than $25 million. More than 90 of the 160 deals involved investors from outside Georgia.

“ATDC is an invaluable resource to Georgia, as the leading organization for advancing business incubation and entrepreneurship,” said Susan O’Dwyer, national director of venture capital research for PricewaterhouseCoopers. “Over its 26-year history, ATDC’s staff has provided hundreds of entrepreneurs at early-stage companies with the right experience, business planning advice and networking resources needed to grow their companies – while contributing to Georgia’s reputation for innovation.”

ATDC companies accounted for one of every five venture capital deals done in Georgia over the last eight years, and 15 percent of the total dollars raised in the state. The one billion includes funds raised by companies throughout their growth, including their time in the incubator and after they graduated. The amount does not include the value of mergers and acquisitions – which would add another $830 million in shareholder value.

While Georgia has pursued traditional economic development strategies, it has also made substantial, long-term investments in supporting startup companies. In 2005, ATDC companies – including both graduates and current members – generated $1.7 billion in revenues and provided 4,326 jobs.

The incubator is an example of how universities are making an increasingly important contribution to local and state economies, noted Wayne Hodges, vice provost for Georgia Tech’s Enterprise Innovation Institute – ATDC’s parent organization.

“Through ATDC, Georgia Tech is helping build a strong community of experienced entrepreneurs,” Hodges noted. “The billion-dollar celebration demonstrates that the strategy of supporting the development and growth of startup companies has paid off for the state.”

About a quarter of ATDC companies grew out of technology developed at Georgia Tech. Two of the 2007 graduates, Jacket Micro Devices and Qcept Technologies, got their start in the Georgia Tech VentureLab program, an initiative that helps form companies from research innovations.

At the May 10 event, VentureLab graduated seven companies, of which three – Asankya, Sentrinsic and Vivonetics – have already been accepted into the ATDC.

“Because of its focus on real-world applications, Georgia Tech’s research program generates a large number of innovations – nearly one a day – that have potential commercial value,” Hodges added. “We want to move those innovations in the marketplace, through startups where those make sense and through transferring technology to existing companies.”

For more information about the ATDC’s billion-dollar milestone, please visit (www.atdc.org/billion/).

About the ATDC: The Advanced Technology Development Center is a nationally-recognized science and technology incubator that helps Georgia entrepreneurs launch and build successful companies. ATDC provides strategic business advice and connects its member companies to the people and resources they need to succeed.

More than 110 companies have emerged from the ATDC, including publicly-traded firms such as MindSpring Enteprises – now part of EarthLink. Headquartered at Technology Square on the Georgia Tech campus in Atlanta, ATDC has been recognized by both BusinessWeek and Inc. Magazines as among the nation’s top nonprofit incubators. Since 1999, ATDC companies have attracted more than a billion dollars in venture capital funding.

ATDC Facts

1) As of June 2007, ATDC had 34 member companies in its program. The companies are working in the following technologies:

* Software and Information Technology – 38 percent
* Bioscience and Health Care – 26 percent
* Electronics – 21 percent
* New Media and the Internet – 15 percent

2) ATDC companies do business in four Georgia cities:

* Atlanta (25 companies)
* Columbus (1 company)
* Savannah (5 companies
* Warner Robins (3 companies)

3) Ten of the top 25 venture capital deals included in the MoneyTree™ Report for 2006 involved ATDC companies. (The report is a collaboration between PricewaterhouseCoopers and the National Venture Capital Association based on data provided by Thomson Financial.) The five largest deals involving ATDC companies were:

* Air2Web ($25 million)
* CardioMEMS ($22.6 million)
* EGT ($14 million)
* Jacket Micro Devices ($12 million)
* iVivity ($9.9 million)

Research News & Publications Office
Enterprise Innovation Institute
Georgia Institute of Technology
75 Fifth Street, N.W., Suite 314
Atlanta, Georgia 30308 USA

Media Relations Contact: John Toon (404-894-6986); E-mail: (john.toon@innovate.gatech.edu).

Writer: John Toon