I spoke with a professor and learned that The University of Tennessee chemistry department turns a net profit. It receives zero tuition money. It has patents and research grants. How does it achieve this? Is this a common thing? How to find/execute profitable patent producing research? And How to win grants?
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2Do you have any sources for your question? To me, it seems unlikely that the department "It receives zero tuition money".– Richard EricksonCommented Nov 28, 2017 at 18:39
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1As part of a non-profit state sponsored university, it is unlikely that it makes a "profit". Certainly the (total dollars in) must be greater than or equal to (total dollars out), or somebody in the university finance office (or the legislature) will get very interested in them.– Jon CusterCommented Nov 28, 2017 at 19:47
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@richarderickson I spoke with a professor.– DaleCommented Nov 28, 2017 at 20:38
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This is a really interesting question, though its statement above doesn't include much in the way of references or information. Editing in some background might help to improve its reception.– NatCommented Nov 29, 2017 at 5:18
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1@Dale your question lacks information. You mention "the...chemistry department turns a net profit" from just "patents and research grants," and question how this is possible. Assuming the University of Tennessee provides buildings and equipment, pays salaries, etc., there are approximately zero outgoings. Further assume revenues from patents and grants are the only incoming revenue. It follows that the department "turns a net profit." But, this is a meaningless calculation. Your question is interesting nonetheless, but without detailed financial information it is difficult to answer.– user2768Commented Nov 29, 2017 at 9:45
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2 Answers
There are a large number of soft-money research centers that are essentially stand-alone - they have to bring in enough research money to cover their costs, and don't receive tuition support, TA lines, etc. I suspect the most common place to find them is in the biomedical field. I worked for one when I was a postdoc.
- How does it achieve this? There are a number of ways to do this. A generous initial endowment can help. Patents, and the licensing revenue that comes from them are, for some fields, a major source of income. And then there are grants. Lots and lots of grants.
- Do they have strategies that get them here? Yes. One does not get there by accident.
- Is this model reproducible? Given there is more than one such organization, the answer is clearly yes.
Whether it's desirable or sustainable is, on the other hand, another question. In my experience, there is an immense amount of pressure on the senior leaders of such organizations, because if grant funding doesn't come through, there's no safety net, and you're immediately talking about firing people. And because the operating expenses for any academic unit are quite high, they often depend on a small number of large grants to support them (for example, where I was a postdoc, I don't think it was possible to write enough NIH R01-scale grants to cover things).
That's a very high risk position. If a program gets cut, funding falls through, etc. there's suddenly a massive hole in the budget.
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2@Dale Patents can be involved, and a lucrative licensing agreement is a big deal, but it would have to be something wildly successful to subsidize a whole department, and it's not something you could count on from the outset.– FomiteCommented Nov 29, 2017 at 0:24
This is an incredibly complex question. The only way to get a near accurate answer would be to ask to meet the department chair and ask him or her. Given that UT is a public university you might be able to use the Freedom of Information Act to get your questions answered.
