Inventing the future

BELLEVUE, Wash. Brainstorming in a swamp. Whipping up a blizzard of patent applications. And cutting a raft of business deals.

That's the new strategy being field-tested by Nathan P. Myhrvold, the man formerly known as "Microsoft's Brain," who wants to revolutionize technology transfer and improve the quality of inventions flowing into the marketplace.

Myhrvold, the versatile founder of Microsoft Research, left Microsoft Corp. and the comforts of corporate technology development in 2000 to start Intellectual Ventures LLC, a firm whose core competency is pumping out ideas with the help of renowned scientists and inventors like Robert S. Langer of MIT and Dr. Leroy Hood of the Institute for Systems Biology in Seattle.

Intellectual Ventures was created to spur the kind of long-term basic research projects that Myhrvold believes are being neglected in corporate research labs, which have moved toward customer-driven applied research. "Invention just gets short shrift," he lamented in an interview.

The firm's game plan is still in its early stages, its principals remain secretive about their inventions-in-progress, and Intellectual Ventures only recently was issued its first patent, because of a wait of up to three years in securing patents from the US Patent and Trademark Office. But the firm's business model and the involvement of Myhrvold have already captured the attention of deep-pocketed investors and venture capitalists who think Intellectual Ventures could fuel a new market in patents that will accelerate innovation.

"Here we are in this funky office park in a swamp in Bellevue," Myhrvold said, laughing heartily. "Why on earth do we have any reason to believe we can out-invent people in other places? Part of it is that our inventors are some of the best inventors in the world.

"The other thing is we focus on inventions. Our model is somebody else will take them to market, not us. It's not that there's anything wrong with taking things to market or building companies, but the world's full of people who know how to do that."

On the other hand, idea generators like Myhrvold, an inventor on more than 100 patents who exudes a contagious enthusiasm for the possibilities of technology, are rarities. The 47-year-old is something of a 21st century Renaissance man: an accomplished photographer, a gour met chef, a multimillionaire (courtesy of 14 years of Microsoft stock options), and an amateur paleontologist. A cast sculpture of a prehistoric sharp-jawed terror, a fish called dunkleosteus, adorns his office.

After several years of hush-hush activity, recruiting inventors, and lining up investors, Myhrvold took the wraps off Intellectual Ventures, which he cofounded with former Microsoft colleague Edward Jung, in a September 2003 speech to the Emerging Technologies Conference at MIT in Cambridge. The speech was remarkable for its scathing critique of today's research labs, which he said avoid big ideas and are confined by the commercial or academic interests of their sponsors.

Since then Myhrvold has been a whirlwind of activity. He has more than doubled, to 22, his stable of senior inventors, people like Langer and Edward E. Harlow at Harvard Medical School, who, in Myhrvold's words, "have not sold their brains" to corporations. While they keep their day jobs, typically at universities or their own companies, they consult on an ongoing basis and take part in brainstorming invention sessions. Myhrvold has hosted about 70 so far across the nation and abroad, on topics ranging from physics to biotechnology.

"It's really blue-sky brainstorming, and it's a lot of fun," said Langer, an MIT institute professor who has founded biotechnology start-ups in the Boston area and has participated in Intellectual Venture invention sessions in Bellevue and Boston. "I haven't seen anything like this where they're looking for big ideas. Generally, when you come up with a big idea, people say you can't do it. This is a model where we can do it."

Each of these sessions is interdisciplinary, with specialists from fields as diverse as medicine and computer science weighing in. At a biomedical session in February, a brain surgeon spelled out problems encountered in seeking to cut away tumors without harming other parts of the brain.

"We sit around and brainstorm, and we've come up with two or three ideas for doing new kinds of brain surgery," Myhrvold said.

The ideas are quickly reviewed and refined by the firm's intellectual property staff and turned into patent applications.

Intellectual Ventures has been filing about 25 applications a month and has some 400 patents pending in fields like computer hardware and software, user-interface design, semiconductors, medical devices, nanotechnology, and advanced particle physics. Its first patent, issued last December, was for a method of capturing images with a microlens array.

Unlike venture capital firms, which seek a return on investment in about five years, Myhrvold will often operate on a much longer time horizon. Once a patent is awarded to Intellectual Ventures, the technology typically will be licensed to a large high-tech or life sciences company, or to a venture-backed start-up, which will market it. But it could be a decade or more before it reaches the end user.

"It's a long payback cycle," said Myhrvold. "It means that we have to risk a lot of money, and we have to have very patient investors."

The model at Intellectual Ventures isn't universally applauded.

At the Cambridge session where Myhrvold first outlined his vision, an audience member criticized what he called its ivory- tower notion of ideas largely divorced from the real world of customers and users.

In fact, a new model of "customer- driven innovation" is fast emerging in technology circles today, said Boston high-tech consultant Patricia B. Seybold.

Myhrvold's consortium of inventors could be compatible with such a model, so long as customers are brought in at a later stage in the process, Seybold said. "Once you come up with a good idea, the next step is to go out and find some lead customers and get them to codesign what you're coming up with."

For some investors, a major attraction of Intellectual Ventures is the opportunity to fund start-ups that license its intellectual property and to own shares of high- value technology patents that can be sold or traded like mortgage-backed securities or real estate investment trusts.

"It's a revolutionary new business model," said Izhar Armony, a partner at Charles River Ventures, one of the firms that has invested in Intellectual Ventures.

And, financially speaking, he said, "intellectual property is emerging as a new asset class."

Robert Weisman can be reached at weisman@globe.com.