Making university research make money

Summary

Marketplace Morning Report — "Making university research make money"

Date: December 3, 2025
Host: David Brancaccio
Featured Guests: Chris Farrell (Marketplace Senior Economics Contributor), Susan Schmidt (Exchange Capital Resources), Carla Javier, William Lee Adams (BBC), Dana Peterson (Conference Board), Joanne Hsu (Univ. of Michigan), Camelia Kunin (UNC Business School), Rick Hibbs (University of Minnesota)

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Episode Overview

This episode focuses on the growing trend of universities commercializing their research in response to shrinking federal funding. The report spotlights how institutions like the University of Minnesota are ramping up efforts to turn innovations from faculty and students into startups and licensed technologies, a strategy historically led by elite schools like Stanford and MIT. The episode also covers job market trends, Indian tech policy, and a quick update on consumer sentiment among young adults.

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Key Discussion Points & Insights

1. Shifting Job Trends & Economic Sentiment

• Private Payrolls Down:

  • ADP's report highlights a 32,000 drop in private payrolls, particularly among small businesses (01:30).

  • Larger businesses remain largely unaffected.

  • The official government jobs data is delayed due to a government shutdown (02:07-02:17).

  • The delay affects the Fed's decision-making on interest rates.

    Susan Schmidt: "Most of these losses are from smaller businesses. So that under 50 employee business is really taking stock and just seems to have put a pause on hiring, not picking up new workers, larger businesses still doing okay, seeming to add on workers." (01:51)

• Market Reaction:

  • The bond market welcomes the payroll drop, lowering 10-year interest rates to 4.06% (02:47).

2. India Reverses Surveillance App Mandate

• Indian Smartphone Policy:

  • The Indian government reversed its decision to force phone makers like Apple and Samsung to pre-install a state-run cybersecurity app after backlash from privacy advocates, opposition, and manufacturers (03:23).

    William Lee Adams: "The government also found itself at odds with phone manufacturers as Apple and Samsung had plans to not comply with the directive, according to the news service." (03:23)

3. Consumer Confidence: Young Adults Stay Optimistic

• Young Adult Optimism & Puzzling Data:

  • Surveys from the Conference Board show young adults have retained or even slightly improved confidence, despite overall falling numbers (05:38-06:06).

    Dana Peterson: "They're not as disenchanted, I guess, as the older group." (06:01)

  • University of Michigan data, however, suggests convergence among all age groups, showing persistent pessimism partly related to the cost of living.

    Joanne Hsu: "You know, our questions are very much going to be picking up how people feel about their living standards, about cost of living. And that's one of the reasons I think that young consumers in our data are expressing as much pessimism as they are." (06:33)

  • Concerns remain about youth investment in their futures and communities if pessimism lingers.

    Camelia Kunin: "If anything, you want young people to be those most optimistic about the potential of the American economy because if they're losing hope ... they might not invest in themselves or their communities." (06:55)

4. Main Story: Monetizing University Research

Segment Start: 07:07

- Funding Cuts Drive Change

• Trump administration wants "deep cuts in federal funding for research at American universities, including cutting money for basic research by more than a third." (07:07)
• Universities are increasingly seeking commercial opportunities for their research output.

- Case Study: Minnesota’s Techcomm Office

• University of Minnesota has become a leader in spinning out startups from academic research (07:48).

• Techcom, the university’s tech commercialization hub, has supported 285 startups since 2006—almost half since 2020 (08:29).

• Minnesota is in the elite company of only four universities nationwide spinning off 20+ startups annually.

• Significant investments and talent hires are credited for this acceleration.

  Chris Farrell: "Techcom, they backed 285 startups, just as you're mentioning, in various ways since 2006. Nearly half that growth came since 2020. And in the past five years, only four universities have spun off 20 or more startups a year. And Minnesota ranks among the top four." (08:29)

  Chris Farrell (on ecosystem): “The university invested a little bit more in the office, brought in some people from the outside, and then really support the entrepreneurial ecosystem. Sort of this entrepreneurial feeling within the faculty.” (09:06)

• The startup goal is ambitious, aiming for 30, 40, even 50 launches a year (09:57).

  Chris Farrell: "The Techcom office backed a record 26 startups this past year. And while he's having the conversation with them, the ambition is eventually ramp up to 30, 40, 50 startups a year." (09:57)

- Broader Trend: Monetization as Funding Grows Uncertain

• Universities cannot count on federal research funding; they're scouting other revenue streams.

  Brian Rosenberg: "Very hard to go back to a world in which you treat [federal funding] as certain. And so I think you're going to see universities looking for other sources of revenue, and I think you're going to see more of them trying to monetize." (09:20)

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Notable Quotes

• Susan Schmidt (Exchange Capital Resources):
  "Most of these losses are from smaller businesses. So that under 50 employee business is really taking stock and just seems to have put a pause on hiring..." (01:51)

• Dana Peterson (Conference Board):
  "They're not as disenchanted, I guess, as the older group." (06:01)

• Joanne Hsu (Director, Univ. of Michigan Consumer Sentiment):
  "Our questions are very much going to be picking up how people feel about their living standards, about cost of living." (06:33)

• Chris Farrell (Marketplace):
  "In the past five years, only four universities have spun off 20 or more startups a year. And Minnesota ranks among the top four." (08:29)

• Brian Rosenberg (Harvard/Former Macalester College):
  "Very hard to go back to a world in which you treat [federal funding] as certain. And so I think you're going to see universities looking for other sources of revenue..." (09:20)

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Timestamps for Important Segments

• Job Market Update: 01:30–02:47
• India’s Surveillance App U-turn: 03:23–04:22
• Consumer Sentiment, Young Adults: 05:38–06:55
• University Research Monetization (Main Story): 07:07–10:10

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Memorable Moments

• Highlighting Minnesota’s rapid growth in university spinouts:
  “The Techcom office backed a record 26 startups this past year... the ambition is eventually ramp up to 30, 40, 50 startups a year.” (09:57)

• Warning over funding volatility:
  “Very hard to go back to a world in which you treat [federal funding] as certain.” (09:20)

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Conclusion

This episode delivers a succinct and insightful look into how American universities are adapting to an era of declining federal research support. By nurturing technology transfer offices and startup ecosystems—not just in the elite, coastal schools but in heartland institutions like the University of Minnesota—universities are turning scholarly innovation into commercial success. The episode situates this trend within broader economic currents: a tightening jobs market, shifting consumer sentiments among the young, and the always interesting intersection of technology, regulation, and privacy on the world stage.

Transcript

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[David Brancaccio]

When governments want to watch Everybody's smartphone I'm David Brancaccio in Los Angeles. It is odd to see a drop in the number of people drawing payrolls, but the ADP payroll company and its research partners just reported that the payroll number fell by 32,000 and the month just ended. The Susan Schmidt is portfolio manager at Exchange Capital Resources.

[Susan Schmidt]

Most of these losses are from smaller businesses. So that under 50 employee business is really taking stock and just seems to have put a pause on hiring, not picking up new workers, larger businesses still doing okay, seeming to add on workers.

[David Brancaccio]

All right, so if you don't like today's private sector jobs report, wait for the official government data. But because of that government shutdown we had, it's been delayed for almost another two weeks.

[Susan Schmidt]

That's right. It's gonna come out on the 16th, but not particularly helpful on the 16th. Remember that our Fed meeting is next week. So the Fed likes to have that government data. That's a lot of what they look at to see what they should do, get cues for them on how they wanna handle interest rates. That's not gonna happen this time around. The government shutdown's impact lingers on. It's going to make it a more difficult decision for the Fed, who has to do something next week and make a decision one way or the other about interest rates.

[David Brancaccio]

Susan Schmidt at Exchange Capital Resources thank you, thank you. The bond market cheered fewer people working on the bet that inflation might be reduced, bringing the 10 year interest rate down to 4.06%. Now about 20 minutes or so into the trading day, the S and P is down a 10th percent. The Nasdaq is down 0.5%. The Dow has just gone flat amid widespread backlash in India. The government there has backed off trying to force smartphone makers to preload a state run cybersecurity app on all new devices. Here's the BBC's William Lee Adams before.

[William Lee Adams]

This U turn, the Indian government had confidentially ordered companies including Apple and Samsung to preload new phones with an app called communication partner within 90 days. But there was a wave of protest from Prime Minister Narendra Modi's opponents and privacy activists over surveillance fears. Newspaper editorials joined privacy advocates in denouncing the move. The government also found itself at odds with phone manufacturers as Apple and Samsung had plans to not comply with the directive, according to the news service. Reuters officials said the app only helps track and block stolen phones and prevents them from being misused. I'm William Lee Adams for Marketplace.

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This week, we'll get a first read on consumer sentiment in this new month, December. It's based on surveys out of the University of Michigan. And a business group called the Conference Board also monitors the economic mood. But there's a mystery involving younger consumers, marketplaces. Carla Javier explains.

[Carla Javier]

When Camelia Kunin at the University of North Carolina Business School wants to know how people are feeling, she looks to the Conference Board and the University of Michigan. So there's a confidence measure and the sentiment measure. Younger adults tend to be more optimistic, she says the latest Conference Board data reflects this. Chief economist Dana Peterson says while confidence has been falling this year, younger people.

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They'Re not as disenchanted, I guess, as the older group.

[Carla Javier]

In fact, she says, there was a bump for young adults in November. They're still trying to figure out why.

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And even if we smooth, you know.

[David Brancaccio]

Did a six month moving average, a November number would still be slightly better.

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But certainly for the other age groups.

[David Brancaccio]

It was materially worse.

[Carla Javier]

The University of Michigan's consumer sentiment survey tells a slightly different story. Director Joanne Hsu says age groups converged this year, not confident, not thriving.

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You know, our questions are very much going to be picking up how people feel about their living standards, about cost of living. And that's one of the reasons I think that young consumers in our data are expressing as much pessimism as they are.

[Carla Javier]

And that pessimism is why Camelia Kunin at UNC remains concerned. If anything, you want young people to.

[Susan Schmidt]

Be those most optimistic about the potential.

[Carla Javier]

Of the American economy because if they're losing hope, she says, they might not invest in themselves or their communities. I'm Carla Javier for Marketplace.

[David Brancaccio]

The Trump administration has been clear on this. It wants deep cuts in federal funding for research at American universities, including cutting money for basic research by more than a third. Among the responses, universities working harder to turn research into money making startup companies. I'm joined now by our senior economics contributor Chris Farrell. Hello, Chris.

[Chris Farrell]

Hey, David.

[David Brancaccio]

Universities like Stanford and MIT have famously helped turn research insights into commercial products and enterprises. Tell me about other universities. Are more getting into this business of commercializing the idea that the professors and the graduate students come up with?

[Chris Farrell]

Yes, more of them are getting into it now. The action is still dominated, David, by these big research schools like the ones that you mentioned. But that said, you know, more inventions, patents, licenses, startups are coming out of universities compared to say, a decade ago. To learn more about these initiatives, I visited the University of Minnesota's technology commercialization office, techcom for short, hubs that take.

[David Brancaccio]

The innovations of academic researchers and then you could license out promising technology or find ways to patent and therefore protect the inventions or even, you know, there might be money for startup businesses themselves.

[Chris Farrell]

That's right. So Techcom, they backed 285 startups, just as you're mentioning, in various ways since 2006. Nearly half that growth came since 2020. And in the past five years, only four universities have spun off 20 or more startups a year. And Minnesota ranks among the top four. Rick Hibbs is associate vice president for research and innovation at techcom. The university invested a little bit more in the office, brought in some people from the outside, and then really support the entrepreneurial ecosystem. Sort of this entrepreneurial feeling within the faculty.

[David Brancaccio]

And with federal money getting cut off, or at the very least more uncertain in this environment, one can imagine other institutions of higher learning would explore this track.

[Chris Farrell]

Absolutely. I mean, look, the traditional model for researchers has been to rely on federal funding. And it was becoming suspect, David, even before President Trump returned to the White House. So Brian Rosenberg, he's the former head of Macalester College and is currently visiting professor at the Harvard Graduate School of Education. Very hard to go back to a world in which you treat it as certain. And so I think you're going to see universities looking for other sources of revenue, and I think you're going to see more of them trying to monetize.

[David Brancaccio]

Some of these startups, which I think you're seeing at the University of Minnesota.

[Chris Farrell]

I did see it. So the Techcom office back to record 26 startups this past year. And while he's having the conversation with them, the ambition is eventually ramp up to 30, 40, 50 startups a year.

[David Brancaccio]

All right, Marketplace's senior economics contributor, Chris Farrell, he's in St. Paul, Minnesota and been looking locally there. Thank you.

[Chris Farrell]

So thanks a lot, David.

[David Brancaccio]

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