Frequently asked questions about WARF's purpose and functions

What is WARF’s mission/role?
WARF’s role is to steward the cycle of research, discovery, commercialization and investment for UW–Madison and the Morgridge Institute for Research.

WARF’s purpose is to promote, encourage and aid scientific investigation and research by UW–Madison faculty, staff and students and by the university-affiliated the Morgridge Institute for Research. 

What is WARF’s relationship with UW–Madison?
WARF is a separate, independent 501(c)3 foundation which serves as the dedicated patenting and licensing organization for UW–Madison. WARF partners with UW–Madison to generate new knowledge and support long-term research opportunities. WARF is not a private foundation, but a 509(a)(3) functionally integrated supporting organization.

WARF is governed by an independent board of successful UW–Madison alumni with expertise in finance, IT, medicine, entrepreneurship, government services and basic industry. The Chancellor serves on the board as the university representative.

What support does WARF provide to UW–Madison?
In 2016-17, WARF provided more than $131 million of direct and in-kind support to the university. In-kind support includes the cost of the patenting, licensing and commercialization that WARF undertakes and the royalty shares provided to faculty inventors. In-kind support would otherwise be paid by taxpayers if the university operated its own patenting and licensing operation.

Since its inception, WARF has provided $2.3 billion in cumulative direct grants, over $400 million of in-kind support and over $300 million to faculty inventors, all adjusted for inflation.

How does WARF help UW–Madison bring in outside funds?
WARF’s decades of partnership have been critical to the university’s ability to attract federal research dollars and maintain its high stature as a research university. WARF’s support is one reason why a university in a state of only five million people has consistently been ranked among the top tier research universities in the world.

Funding by WARF allows researchers to undertake very early stage research that cannot otherwise be funded and if the research proves successful, it is leveraged into attracting federal and other foundation grants. WARF’s dollars also fund graduate students, matching funds needed to attract federal grants, expensive equipment and research tools and in many cases the laboratories themselves. This is funding that state support does not provide for and is critical to attracting large federal grants.

How does WARF support entrepreneurial activity?
Through direct investments and local partnerships, WARF is committed to contributing to an ecosystem that helps move technologies from the university to the marketplace. WARF has licensed over 125 faculty startup companies since 1993 and directly invested almost $40 million in a subset of those companies.

Why does WARF maintain an investment portfolio?
WARF’s investment portfolio was created in the 1920s not only to support research for current and future generations but also to fund the patenting, licensing and commercialization expenses of the foundation. The investment portfolio is managed for present and future needs in alignment with WARF’s mission and consistent with modern practices of similarly sized endowments. WARF trustees have adopted a spending guideline that targets 4.5 percent of the three year running average of the unrestricted portfolio value. The three year average is used to smooth market and operational volatility.

Are faculty, staff and students required to assign inventions to WARF?
UW–Madison faculty, staff and students are not obligated to assign their intellectual property to WARF, unless required to do so by federal law or the terms of a sponsored research agreement with a third party.

Most technologies/products cost WARF more money to bring to market than they recoup through licensing, which explains why most inventor groups seek WARF’s professional assistance. It is expensive and time consuming to get a new product to market and WARF covers those costs for UW–Madison inventors who choose to use WARF.

Over its lifespan, WARF has been and continues to be a world leader in technology transfer. The technologies that arise from research at UW–Madison and are successfully licensed by WARF to large and small companies become products that touch untold lives. 

Does WARF have any relationship with other UW campuses?
WARF works only with UW–Madison. However, in 2000 WARF formed WiSys, which is an independent technology transfer organization that supports all University of Wisconsin System schools, except for UW–Madison and UW–Milwaukee. WARF provides limited financial support and back office services to WiSys, but is otherwise a separate entity.

How does WARF generate its revenue?
WARF generates revenue from licensing royalties and investment management.

WARF distributes 35 percent of its licensing revenue before expenses to stakeholders. For those inventors who partner with WARF, 20 percent of the gross revenues received from the licensing of their intellectual property is directed back to the inventors. An additional 15 percent of gross revenues is directed to their respective departments. The remaining 65 percent of revenue is applied against WARF’s patenting, licensing and commercialization expenses, including legal expenses. Any residual revenue is added to the endowment to be paid out in accordance with WARF’s spending guidelines.

How has WARF been recognized for its efforts?
In 2005, WARF received the National Medal of Technology from President G.W. Bush. This is the highest honor the President can bestow on an individual or organization who has made significant contributions to technology development. WARF received the medal for its legacy, its partnership with the university and industry and its role in federal legislation that permits universities or their patent management organizations to retain title to federally funded inventions.

WARF also has a triple A rating from Standard & Poor’s. The rating recognizes WARF for the professionalism of its staff and the quality of WARF’s management of its resources.