Commercialising innovation from the University of Oxford
At James Cowper members of our technology team regularly work with academics and Oxford University to assist with the financing, tax and accounting issues of spin out companies – from their earliest stages pre-incorporation through growth and up to exit. So what does the process of spin out involve for the University?
Oxford University is one of the world’s great research universities. In 2009–10 the University’s 4,500 academic researchers spent £450 million on research activities across the University’s four divisions of Medical Sciences, Mathematical, Physical and Life Sciences, Social Sciences and Humanities. This activity creates huge billowing clouds of research outputs (intellectual property), some of which can be commercialised. It is with this subset of all the University’s research that Isis Innovation is involved.
Each year Isis receives a number of new ‘disclosures’ of potentially exploitable research outputs from Oxford’s researchers (nearly 300 in 2009–10). The challenge presented by each of these new projects is to establish what the opportunity is, how to protect the idea and what the route from research results to market may be. There are a number of initial alternatives: use the expertise of the researchers to offer expert consulting advice to clients; use intellectual property right protection (patents, copyright, and so on) to license technologies out to existing successful technology businesses; or establish a new company to attract investment finance and experienced management to take the technology to market – in other words, set up a spin-out.
Isis Innovation forms spin-out companies
In the past 10 years Isis has helped researchers at Oxford establish 55 new spin-out companies, all based on Oxford science, involving Oxford scientists. Isis’s role is to contribute to the development of the business plan, find someone to run the company, and find investors to provide the cash necessary to develop the technology and business potential. This is all about building a team of people with different skills and experiences, bringing them together to share a common motivation of building a successful business. Some get involved to make as much money as possible, some to see a life’s work taken up by consumers, some to help tackle a major problem the world is facing, and some to build a sustainable business, providing employment and opportunity in the region.
The process is represented in the diagram. Over time, the intent is to bring together all the skills necessary to secure financial investment into the new company: the right people at the right time for the specific business needs.
The timescales involved vary enormously, from six months to six years. The Isis project manager works with researchers on a range of activities: to understand the technology applications, to translate the technology from the language of science to the language of business and the market, to pitch the investment proposition to appropriate investors from its investor networks and to bring in an experienced manager from its extensive business networks. When everything looks likes it may actually work, the team is joined by professional advisers who are experienced in helping set up and grow technology companies.
The opportunity remains for as long as the founding researchers are able to commit time and there is a strong enough story to tell about the journey from technology to market. This does not always lead to run-away business success; many, many businesses do not go on forever. They may be absorbed successfully into other companies, they may flourish while a limited market opportunity exists, they may fail to meet their objectives and be closed down.
Creating a new company from University research
A university spin-out involves bringing together people from the three different worlds of commerce, investment finance and academic research. There are few people who can themselves operate effectively in all three different environments. University technology transfer offices, such as Isis, exist to help bring the three communities together, to help them understand each other and to find common purpose in creating a new company.
For more information about the work of ISIS Innovation, including information about new opportunities for investment contact: Simon Gray on email@example.com