Corporate research moving in at Pennovation complex

Companies and colleges - especially engineering schools - have worked together for a long time. But not quite like this.

The way it used to work, "industry threw money across the walls and expected something out of it," maybe years later, recounts Vijay Kumar, dean of the University of Pennsylvania's engineering school.

Federal research grants and traditional corporate research sponsorships still account for most of the $55 million that Penn Engineering expects to collect this year from outside R&D funding.

But as big business has evolved from the heavy industry of old toward digital foundations - exploiting small machines, remote communications, and fast turnarounds - large companies are building a new style of research partnerships, "very different" in scale, intimacy, informality, and pace, Kumar says.

"The gap between what we consider basic R&D things that we do in the ivory tower and what industry does is shrinking," he hold me.

Doesn't that create conflicts of interest? It's a convergence, Kumar says: "A lot of the research space we find exciting is also what industry is interested in."

It is to house new corporate-college research teams - along with the scholarly start-ups Penn hopes will grow into larger companies, draw more investors, and grow next to campus - that the school built the new 58,000-square-foot Pennovation Center.

It stands on the 23-acre site of the former DuPont paint factory complex that Penn calls Pennovation Works, across the Schuylkill from its main West Philadelphia campus. University and industry leaders gathered for an opening ceremony Friday.

Examples of partnerships the dean says meet his school's goals - and industry's:

The Comcast Media Center at Penn, headed by electrical engineering professor Rahul Mangharam, is collaborating on ways to select programs and features through smartphones, cloud-based systems, and other digital control arrangements, rendering obsolete the cumbersome-to-update cable-TV set-top boxes that Comcast CEO Brian L. Roberts recently called "the bane of our existence."

Hershey Co. has signed a three-year Pennovation lease. The candy giant is working with engineering professor Mark Yim on a project to develop "consumer robots." Early models might wander through a crowd dispensing candies "for free, but you can imagine them monetizing it later on," Kumar says.

Lockheed Martin, the military contractor and a major Philadelphia-area employer, is in talks with Penn scholars to develop a "machine-learning tools" center to engineer devices that can collect, analyze, and act on data.

Qualcomm, the mobile-phone components maker that bought Kumar's drone-development company last year, runs a 26-member Pennovation team that is developing drones the size of mobile phones.

Besides those manufacturers and communications giants, Kumar says the labs expect to attract large medical-device manufacturers and other digital-health-focused corporations.

Indeed, "we are in advanced discussion with large pharma and life-sciences companies who want to be part of the innovation ecosystem" and Pennovation's "low-cost lab infrastructure," says Roy Rosin, chief innovation officer at Penn Medicine.

Philadelphia tech boosters lament that the city's venture-capital sector is less active than rival Boston's. Kumar cited veteran Philadelphia start-up investor Brett Topche and his partners' decision to base their new investment group, Red & Blue Ventures, at Pennovation, as one step toward fixing that imbalance.

Besides Pennovation Center, Penn is preparing two neighboring former DuPont buildings, totaling 100,000 square feet, for additional partnerships and start-ups.

For now, Penn has temporarily sited its motor pool and other support operations elsewhere on the Pennovation Works campus. "We are trying to be flexible with short-term leases and licenses," to leave room for expansion, says Anne Papageorge, Penn's vice president for facilities and real estate.

Philadelphia already enjoys the reputation of a low-cost place to do business among Northeastern U.S. metro areas, noted Ed Datz, Penn's executive director of real estate. At Pennovation, using "reconditioned" DuPont buildings "keeps the costs lower than in University City," where the Science Center fills space almost as fast as it builds more. That also means lower rents compared with new construction down at the Navy Yard.

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