In 2014, a group of students in MIT’s 15.366 (Climate and Energy) course developed a plan to commercialize MIT research on how to transfer information between chips using light instead of electricity, reducing energy consumption.
After completing a course that challenged students to identify early adopters and pitch their business plans to investors, the team won two major awards, the MIT Clean Energy Prize. Today, Ayar Labs has raised a total of $370 million in funding from a group that includes leading chip companies including AMD, Intel, and NVIDIA to scale up its optical chip interconnect manufacturing.
Ayar Labs is one of many companies that originated from 15,366. Since its founding in 2007, graduates of the class have founded more than 150 companies.
In the course, student teams select a technology or idea and determine the best path to commercialization. The semester-long project is accompanied by lectures and tutorials, providing students with practical experience in starting a business.
“The goal is to educate entrepreneurs on how to start a business in the climate and energy space,” says Todd Hines, the course’s founder and senior instructor, who has taught since 2008. “We do this through hands-on experience. We require students to interact with customers, talk to suppliers, partners, and potential investors, and give presentations to learn from their feedback.”
The class attracts hundreds of students each year. That’s one reason why a 2015 report found that companies founded by MIT graduates generate an estimated $1.9 trillion in revenue each year. If MIT were a country, that number would make it the 10th largest economy in the world, the report said.
“‘Mens et manus’ (‘mind and hand’) is the motto of MIT, and it’s hard to beat the real-world experience we’re trying to provide in this class,” says Hines. “You learn more and are in a better position when you go through the commercial process in the real world. This experiential learning approach really fits with the MIT approach.”
Imitate the beginning
The course was started by Bill Aulet, a professor of the practice at MIT’s Sloan School of Management and executive director of MIT’s Martin Trust Center for Entrepreneurship. After serving as a consultant for the first year and helping Aulet launch the class, Hines began teaching with Aulet in the fall of 2008. The pair also launched the Climate and Energy Prize, which is still ongoing today and recently received more than 150 applications from around the world.
The main feature of the class is to connect students from different academic fields. The organizers aim to recruit students with backgrounds in science, engineering, business, and policy each year.
“This class is designed to be accessible to anyone at MIT,” Hines said, noting that the course is also open to Harvard students. “We’re trying to bridge the disciplines.”
The class quickly became popular throughout the school. Over the past few years, about 150 students have enrolled in the course, with 50 places available.
“I mentioned Climate and Energy Ventures when I applied to MIT,” says Chris Johnson, a sophomore in the Leadership in Global Governance (LGO) program. “When I came to MIT, I was really interested in sustainability, especially energy, and startups. I had heard so many great things about the class that I waited until my last semester to apply.”
Course organizers primarily select graduate students who wish to take the final course of the program so that they can continue working on the project after the course is over.
“Whether or not students implement the project in class, it’s still a great experience that will benefit their careers,” said Jennifer Turlook, climate and energy AI internship leader at the Martin Trust Center for Entrepreneurship, who helped teach the course this fall.
Hines describes the course as a business model. Before the start, the organizers will select up to 30 technologies and ideas that are at the right stage of commercialization. Students can come to the class with ideas and technologies that they want to implement.
After several weeks of presentations and presentations, students are divided into multidisciplinary teams of five and begin working through each of the 24 stages of starting a startup outlined in Aulet’s book “Disciplined Entrepreneurship,” including engaging with initial potential customers, defining a value proposition, and creating a business model. All of this culminates in a final hour-long presentation designed to simulate a presentation to investors or government officials.
“It’s a big job and it’s a team project, so your grade depends a lot on your team,” Hines said. “You also make up about 10 percent of your team’s grade. We try to get people to be proactive and support their teammates.”
Students said the process was quick but rewarding.
“It was definitely challenging,” says Sophie Netteberg, a graduate student in MIT’s LGO program. “Depending on the level of technology, you can progress very quickly. That’s the phase I’m going through, and I find it really fascinating. We basically had lab technology and it was like, ‘What do we do next?’ You also get a lot of support from the professors.”
From the classroom to the world
This fall, the final presentations were held at the headquarters of MIT venture capital firm The Engine before professors, investors, members of entrepreneurship organizations, and others.
“We heard from people that if the startup gets off the ground, it would be a real step forward in technology,” said Johnson, whose team is commercializing a method of storing energy in concrete. “That’s really important. We knew that these were not only people we could meet with next month or in the next funding round, but also people who would ask us questions that we needed to think about. That made everything clear.”
Throughout the semester, students view the project as a real-life task that will take longer than the class.
“Nobody thinks about grades in this class; it’s about learning,” says Netteberg, who encouraged his team to continue working on electrolysis technology that aims to produce green hydrogen more efficiently. “We’re not really concerned about getting an A. If we want to keep doing this, we want real feedback: What do you think we did well? What do we need to work on next?”
Hines said several investors have expressed interest in backing the startup. Moving forward, he hopes students will embrace the experimental environment his team has created for them and try bold new things.
“It’s good that people have been so pragmatic for so many years, but it can also be limiting,” Hines said. “This is another opportunity to do something, something that if it comes together could have a really big impact. This is a time for students to experiment, so why not try something big?”
