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Start Me Up: How Unused Patents Fuel Entrepreneurship

April 16, 2014

Vadu Inc. is a Canadian startup using sophisticated face recognition algorithms and data analytics to study customer behavior. Like many young companies, it’s racing to convert ideas into products and compete on the market.

“We can study people’s movements and behaviors,” says Jason Randhawa, chairman and CEO of Vadu. “We can watch how they interact with the product and employees on the floor, analyze their reactions and sentiment, and see what they like or don’t like about the experience.”

Vadu was born from a unique program developed by GE Ventures, GE Licensing and Alberta Innovates-Technology Futures, a research and innovation platform launched by the Canadian province. It gives entrepreneurs and small and mid-sized businesses access to a treasure trove of unused GE intellectual property. The goal is to bring their ideas to life, and ultimately to the marketplace. Vadu is the first licensee.

This IP sharing partnership is GE’s latest effort at implementing an open-source approach to innovation and entrepreneurship. “This is a unique arrangement for any multinational company,” says Bradley Smith, vice president for regional programs at GE Canada. “It allows GE to work with the government to extend the concept of open innovation into the field of technology licensing.”

GE has long been active in Alberta’s energy sector and Smith says that the new partnership is also helping the province broaden its business mix and grow tech companies. “The local economy is leaning heavily on oil and gas,” Smith says. “The partnership is a strategic diversification play by the government to bolster tech companies in the area.”

Smith says that companies like Vadu get access to GE-owned IP that is dormant or underutilized. GE will receive a return once the products take off. “Everyone benefits,” Smith says.

Randhawa launched Vadu with his co-founders last November. His business is using vision algorithms originally developed at GE labs for GE Security, a business unit focused on video surveillance, access control, alarm systems and other technology. GE sold the business in 2010.

Randhawa says the Vadu will use the algorithms to strip metadata from video captured by store cameras and  mix it with other sales-related information. It will provide store managers with powerful tools to understand customer behavior, assess sales performance and obtain clues for enriching the customer experience.

Says Smith: “This IP was sitting on the shelf. Vadu expanded its value by finding new applications in the retail sector.”