Friday, 27 January 2012

Spin-out vs Start-up

Last year, during the lunch break at a Captum Valuation MasterClass, I was seated between the technology transfer director of one of the UK's leading life science charities, and a technology transfer manager from one of the colleges of the University of London.  By way of an ice breaker, and in my usual non-argumentative style, I suggested that the job of universities was to train highly competent scientists and engineers, and not to commercialize technology.  I argued that universities were not in fact very good at commercial activities, and that government initiatives to promote the licensing of academic research were misplaced.  I should explain at this point that I am only talking about the UK, and that my alma mater Imperial College is clearly the exception to this rule, Imperial Innovation being among the stars of the AIM market.

To my surprise, these two very senior and experienced technology transfer executives agreed with me.  It would be more beneficial, we felt, if such government funds as were available were directed at encouraging newly qualified graduates, PhDs, post-docs, to start-up leading edge technology businesses, rather than attempting to force licenses and the creation of spin-offs from universities.  It is the newly minted scientists and engineers who have state-of-the-art technology at their fingertips, and all the confidence, energy and enthusiasm in the world, albeit with a slight deficiency in business acumen.

The recent move by the University of Glasgow, followed by others, to make their intellectual property open source, would seem to suggest a tacit recognition of the point we made at lunch.  Not everyone agrees, e.g. Imperial and Oxford are unlikely to follow suit.  Neither it seems, does the Technology Strategy Board who last year sent me a survey attempting to solicit ideas on how to make university technology transfer more effective.

One final point is my caveat that I am only speaking of the UK. My US alma mater, MIT, has a long history of successful technology commercialization, but also actively encourages its graduates to start-up companies of their own.  In 2009 it was estimated that annual sales of worldwide companies started by MIT graduates was $2 trillion, making such companies collectively equivalent to the 11th largest economy in the world.  Now why can't the UK do that?  A topic for another time.

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