In 2014, a group of MIT scholars in course 15.366 (Climate and Energy Ventures) devised a strategy to market MIT discoveries regarding the transfer of data between chips using light rather than electricity, thereby decreasing energy consumption.
Upon concluding the course, which challenges participants to identify initial customers and present their business concept to investors, the group proceeded to secure both grand awards at the MIT Clean Energy Prize. Currently, the firm, Ayar Labs, has accumulated a total of $370 million from a consortium that involves chip industry giants AMD, Intel, and NVIDIA, to expand the production of its optical chip connections.
Ayar Labs is among numerous companies whose origins can be linked back to 15.366. In actuality, over 150 enterprises have been established by graduates of the course since its inception in 2007.
During the class, student groups choose a technology or concept and determine the optimal route for its commercialization. The semester-long endeavor, supplemented by lectures and mentoring, provides students with practical experience in launching a business.
“The objective is to instruct entrepreneurs on how to establish companies in the climate and energy sector,” states Senior Lecturer Tod Hynes, who co-founded the course and has been instructing since 2008. “We accomplish this through experiential learning. We require students to interact with clients, converse with potential suppliers, partners, investors, and rehearse their pitches to gain insights from that feedback.”
The course draws hundreds of student applications annually. Serving as one of the accelerators for MIT spinoffs, it is also a contributing factor to a 2015 report that indicated MIT alumni-founded enterprises generated approximately $1.9 trillion in yearly revenues. If MIT were considered a nation, this statistic would position it as the 10th largest economy globally, according to the report.
“’Mens et manus’ (‘mind and hand’) is MIT’s motto, and the hands-on experiences we strive to offer in this course are unparalleled,” Hynes remarks. “When you actually navigate the commercialization process in the real world, you acquire more knowledge and find yourself in a superior position. That experiential education method aligns perfectly with MIT’s philosophy.”
Simulating a startup
The course was initiated by Bill Aulet, a professor of practice at the MIT Sloan School of Management and the managing director of the Martin Trust Center for MIT Entrepreneurship. After assisting as an advisor during the inaugural year and aiding Aulet in launching the course, Hynes began co-teaching with Aulet in the fall of 2008. Around the same time, the duo also established the Climate and Energy Prize, which continues today and recently received over 150 submissions from teams worldwide.
A fundamental aspect of the class is connecting students from various academic disciplines. Each year, the organizers aim to enroll participants with backgrounds in science, engineering, business, and policy.
“The course is intended to be accessible to everyone at MIT,” Hynes states, adding that the class has now opened to students from Harvard University as well. “We’re trying to encourage cross-disciplinary collaboration.”
The class quickly gained traction throughout the campus. In recent years, the course has experienced around 150 applicants vying for 50 positions.
“I referenced Climate and Energy Ventures in my application to MIT,” says Chris Johnson, a second-year graduate student in the Leaders for Global Operations (LGO) Program. “As I entered MIT, I had a strong interest in sustainability, particularly in energy, and also in startups. I had received excellent feedback about the course, and I chose to wait until my last semester to apply.”
The course organizers primarily select graduate students, ideally in the final year of their program so they can more seamlessly continue developing their venture after the class concludes.
“Regardless of whether students continue with the project after the course, it’s an invaluable experience that will benefit them professionally,” asserts Jennifer Turliuk, the practice leader for climate and energy artificial intelligence at the Martin Trust Center for Entrepreneurship, who assisted in teaching the class this fall.
Hynes describes the course as a startup-building simulation. Prior to its commencement, organizers choose up to 30 technologies and concepts that are at the appropriate stage for commercialization. Students can also enter the class with ideas or technologies they wish to develop.
After several weeks of introductions and lectures, students form multidisciplinary teams of approximately five and commence navigating each of the 24 stages of establishing a startup outlined in Aulet’s book “Disciplined Entrepreneurship,” which encompasses tasks such as engaging with prospective early customers, quantifying a value proposition, and outlining a business model. The culmination is an hour-long final presentation aimed at simulating a pitch to investors or government officials.
“It’s a significant amount of work, and since it’s a team-based project, your grade heavily relies on your group,” Hynes notes. “You will also receive peer evaluations; that contributes around 10 percent of your grade. We attempt to motivate individuals to be proactive and supportive teammates.”
Students express that the process is rapid yet fulfilling.
“It’s certainly challenging,” shares Sofie Netteberg, a graduate student also enrolled in the LGO program at MIT. “Depending on your stage with the technology, you may progress very rapidly. That’s the phase I was in, which I found incredibly engaging. We basically had lab technology, and the question was, ‘What do we do next?’ You also receive abundant support from the professors.”
From the classroom to the world
This fall’s final presentations were held at the headquarters of the MIT-affiliated venture firm The Engine, in front of a crowd of professors, investors, and representatives from organizations supporting entrepreneurship, among others.
“We received valuable feedback from individuals who would be the next logical step for the technology if the startup gets up and running,” stated Johnson, whose team was commercializing a technique for energy storage in concrete. “That was incredibly insightful. We realize that these are not only people we might encounter in the upcoming month or future funding rounds, but they’re precisely the kind of individuals that will pose the questions we need to contemplate. It was enlightening.”
Throughout the semester, students approached the project as though it were a genuine venture they would continue working on long after the course had ended.
“No one is primarily focused on the grade for this class; it’s about the learning experience,” remarks Netteberg, whose team was encouraged to persist in developing their electrolyzer technology engineered to more effectively produce green hydrogen. “We aren’t anxious about achieving an A. If we desire to continue refining this, we want substantial feedback regarding: What aspects do you think we excelled in? What areas need further attention?”
Hynes notes that several investors showed interest in supporting the businesses emerging from the class. Looking ahead, he hopes students take advantage of the experimental environment his team has crafted for them and explore ambitious new ideas.
“People have been quite practical over the years, which is commendable, but it can also be somewhat confining,” Hynes reflects. “This is an opportunity to attempt something that may seem a bit unconventional—something that holds significant potential for impact if it comes together. This is the moment for students to experiment, so why not aim for something grand?”