The following five steps will provide a simple, rough guide to how to proceed and where to learn more.

1. Talk to a few colleagues in your department who have participated in founding companies
2. Visit your institution's Technology Licensing Office (TLO)
3. Write a short summary
4. Look for an experienced entrepreneur with business development or marketing experience
5. Continue developing the technology and help with fundraising

More Detail Below:

Talk to a few colleagues in your department who have participated in founding companies, sat on the Board of start-up companies or done consulting with companies. They will be the best initial sounding board for your ideas.

Visit your institution's Technology Licensing Office (TLO) or Technology Transfer Office (TTO).

Even if you choose to do a start-up, the first step is still to go through your TLO. The TLO will help with patenting, refer you to resources in the community for investment and to meet entrepreneurs, and when the time is right, will license the technology to the start-up firm that you and your co-founders create.

Write a short summary

One of the first things that the TLO may ask you to do is to write up a simple one to five page document explaining in simple terms how the technology works, what is novel about it relative to similar technologies, and what you imagine as the market for the product. The first paragraph should sum it up in a way that your mother would understand! This should not be a full length business plan at this stage and it can even be just a few slides in a PowerPoint document. The idea is not to overwhelm the reader, but just to provide easy to understand information on the idea and how it is better than what is currently used. Here are a few examples:
Here is a good basic outline for a Company Prospectus or First Draft Executive Summary for Investors and Entrepreneurs.

Sample Executive Summaries (these are likely much more detailed than what is needed at this stage):

http://www.mit100k.org/docs/Summary_CheapTalk.pdf
http://www.mit100k.org/docs/Summary_CMS.pdf
http://www.mit100k.org/docs/Summary_SiliconTest.pdf

Look for an experienced entrepreneur with a business background as a co-founder

You may be the technical entrepreneur, but you need a business co-founder to succeed. If you've followed the above suggestions and read the discussion on licensing vs. entrepreneurship on this site, then you're ready to start looking for an experienced entrepreneur with a sales & marketing or business development background to bring in as a co-founder. This is a critical step and should be approached with care. Do not team up with the first person who comes along. Just as it is difficult for business people to judge good science, it is difficult for scientists to judge a good entrepreneur. Read the section of this site on: What to Look for in an Entrepreneur? Talk with colleagues from your university or medical school who have had entrepreneurial experience, they may be able to recommend someone. You can even start creating a Scientific Advisory Board of researchers with relevant technical experience who also have commercialization experience. They can then be asked to help in finding a suitable entrepreneur.

Create an elevator pitch that describes your idea in the space of 1-2 minutes.

Template:

1st sentence: State the Problem
2nd sentence: State your solution
3rd sentence: Who you are, why you're the one to solve the problem
3rd sentence: State the value proposition
4th sentence: Call to action (what the audience or recipient should do next)

Speak with the TLO or with the Entrepreneurship Center at your local university or business school. Talk to lawyers and angel investors and attend any commercialization or entrepreneurship events happening at the local university. Do not be afraid at this stage to let people know about your ideas and that you are looking for an entrepreneur with experience related to this area. See the section on "Common Start-up Mistakes" for pitfalls to avoid.

Continue developing the technology and help with fundraising

Having found a credible, experienced business
entrepreneur, it is now your job to work with him or her to support the efforts for creating a more formal PowerPoint and executive summary, doing fundraising pitches and primarily, continuing to develop the technology. You should be honest with one another and have discussions early on your goals and how to split up any equity in the company. Do this before any real money is at stake. While you should not think that your job is over by any means, an experienced entrepreneur should now be leading and guiding you through the process. See the section on "What Do Business Entrepreneurs Expect of Me? - Timeline."

Alternatively, it may be the case that you are not successful in finding a high-quality, experienced entrepreneur. Don't worry, it takes time and your technology may not be developed enough, or may be more appropriate for licensing. However, there are things you can do assuming you still want to form a new company. One option is to talk with professors and students at your university's business school or the organizers of the local business plan competition. If you can find graduate science/engineering or MBA students who are interested in writing a business plan and competing in a start-up competition or helping to write SBIR or foundation grants, this can be an excellent way to keep making progress and networking with investors and more experienced entrepreneurs. Just be upfront with the students so that everyone is on the same page in terms of what is expected and what the rewards may or may not be.

Business Plans – what to include and samples:

http://mit100k.org/resource-business-plan-outline.php

Further information

• see the articles on Nature Biotechnology's Bioentrepreneur site,
• the Kauffman eVenturing Entrepreneur's Resource Center,

Other Innovation Center sections for more information:

• Medical Devices vs. Pharmaceuticals
• References