Nanotechnology research at UTPA leads to business growth
Posted: 12/14/2011
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A high-tech company in the Rio Grande Valley that sells a machine that can revolutionize how nanofibers are made all started with the collaboration of two faculty members of The University of Texas-Pan American.

UTPA President Robert S. Nelsen, pictured third from right, prepares to help FibeRio Technology Corp. President and CEO Ellery Buchanan cut a ribbon to commemorate the opening of FibeRio's new facility in south McAllen. Pictured with Nelsen and Buchanan in front are (from left) Dr. Shirley Reed, president of South Texas College; Yolanda Chapa, chief administrator for Hidalgo County Judge Ramon Garcia; Buchanan; Nelsen; State Rep. Sergio Muñoz (Dist. 36); and Richard Cortez, mayor of McAllen.

The research of Drs. Karen Lozano, Julia Beecherl Professor in Engineering, and Kamal Sarkar, lecturer, in UTPA's Mechanical Engineering Department led to the creation of technology that can provide a more affordable way to make nanofibers. Nanofibers are one-one hundredth the size of a human hair and can have myriad uses from water filtration to wound care.

Their work led to collaboration with UTPA's Office of Innovation and Intellectual Property (OIIP), state and community leaders and a capital venture company that resulted in the creation of FibeRio Technology Corp., the first technology start-up company at UTPA.

On Nov. 29, FibeRio welcomed UTPA representatives, as well as officials from state, regional and local entities to its new home on Wanda Drive in south McAllen and to celebrate the teamwork of public and private entities that contributed to its existence. Before, FibeRio had been incubated at UTPA's Rapid Response Manufacturing Center.

"It takes a village to create a FibeRio," said UTPA President Robert S. Nelsen during a press conference announcing the grand opening of the company's new headquarters. "And we have a real village here. ... This University, The University of Texas-Pan American, is committed to the Valley, committed to McAllen, committed to our citizens and students."

Nelsen joined government and economic development leaders from McAllen, Hidalgo County and the state in praising Lozano and Sarkar, as well as everyone else involved in forming FibeRio and helping it grow into a viable business.

Others who spoke at the event included State Rep. Sergio Muñoz (Dist. 36); Yolanda Chapa, chief administrator for Hidalgo County Judge Ramon Garcia; McAllen Mayor Richard Cortez; Keith Patridge, president and CEO of the McAllen Economic Development Corp.(MEDC), Jonathan Taylor, director of the Texas Emerging Technology Fund (TETF) and Ray Hansen, founder and CEO of Rio Bravo Ministries, a faith-based nonprofit organization FibeRio and its President and CEO Ellery Buchanan support.

Throughout the ceremony, which was followed with a ribbon cutting and tours of the new facility, speakers reminded everyone of the team effort it took to develop the company.

And time.

Five years, to be exact, said Jackie Michel, the OIIP's director.

"I think it's important for people to recognize that they didn't just invent something one day and FibeRio existed the next day, that it's a process, because an invention is not a product, and one has to look at -- especially when it is an invention that is a game changer -- how to get that invention into the marketplace," Michel said.

UTPA Vice President for Business Affairs Martin Baylor, pictured left, observes a machine that creates nanofibers that FibeRio developed with technology invented by UTPA faculty members Dr. Karen Lozano and Dr. Kamal Sarkar.

The faculty members' work, disclosed to the OIIP, was patented. In January 2009, UTPA received a University of Texas System Texas Ignition Fund grant that funded both the prototype development and commercialization plan development, on which the University worked with Buchanan.

Buchanan and UTPA co-founded FibeRio in November of that year.

Michel added that the University was fortunate to find Buchanan, who has extensive experience in the business of nanotechnology, to head the company.

"When you want to start a new company like this, you want someone who has a depth of experience, knowledge and relationships already built, so he knows how to get things done," she said.

Less than a year later, FibeRio was awarded a $1.5 million Commercialization Award toward the development of the company's novel Forcespinning™ technology from the TETF and secured private financing led by Cottonwood Technology Fund, a venture capital firm based in El Paso.

Lozano, who is FibeRio's chief technology officer, and Sarkar received founders shares through UTPA's equity interest in the company. UTPA receives royalties from FibeRio as a result of the licensed patents and shares royalties with the inventors.

"In the start-up we shared both equity and in all inventions when we license the inventions we sell them, or commercialize them, the inventors get half the royalty after expenses," Michel said. "It's one of the highest return rates to inventors among universities in the country."

Beto Pallares, managing partner of Cottonwood Technology Fund, said it takes many things to mature an idea, including money and great people, and FibeRio had everything the firm was looking for in a potential investment.

"We invested in August 2010 and for us to see this level of development is truly impressive," said Pallares, who attended the grand opening celebration. "As an investor, you invest in the business that the management team is telling you they can execute on. We were certainly sold that these people had something that was worthwhile."

Because the business deals with complex, high level technology, Pallares said he and fellow investors talked to many people who are considered to be world experts in nanotechnology to validate that FibeRio had a product that was novel, useful, protectable and would have a market.

"So you have the opportunity of a big market, you have the ability to protect something and bring it to market ... putting those components together it made sense to back it," he said.

FibeRio's creation has not only benefitted the University financially, it is helping the Valley's economy grow and providing jobs for its residents.

Buchanan said FibeRio has hired and is continuing to hire Valley residents, including UTPA graduates, as well as people with specialized skills from all over the world. The company also has customers from all over the world come in weekly to look at the equipment FibeRio has created from Lozano and Sarkar's research.

Sarkar and Lozano said they are grateful to everyone who was a part of their research and the birth of FibeRio.

"It's really very satisfying because I have worked in the industry for 20 years," Sarkar said. "I've become so humbled."

Lozano said she hopes FibeRio will continue to grow and employ more UTPA graduates, as well as become a problem solver in the nanotechnology field.

Though FibeRio has moved off campus, Lozano and her team at UTPA continue to research the myriad possible uses for nanofibers.

"We have about 15 students working on what else we can do," Lozano said. "We've already submitted more disclosures for materials to Jackie Michel."