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Success Factors in Technology Transfer Oxford Case Study

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1 Success Factors in Technology Transfer Oxford Case Study
Tim Cook Director, Isis Innovation, University of Oxford Visiting Professor in Science Entrepreneurship, Said Business School

2 Tim Cook Managing Director of tech based companies (1983 – 90) 7 yrs
BA Physics, DPhil Cryogenics - Oxford University HNC Mechanical Engineering - Oxford Polytechnic Diploma Accounting & Finance - Institute of Certified Accountants Managing Director of tech based companies (1983 – 90) 7 yrs Oxford Analytical Instruments Microsystem Design Limited Micrelec plc Private Investor (1990 – 97) 7 yrs Founding Managing Director Oxford Semiconductor Founding Managing Director Oxford Asymmetry University Technology Transfer (1997 – 2007) 10 yrs Director Isis Innovation, Oxford University ( ) Visiting Professor in Science Entrepreneurship, Oxford University (2006) 5

3 Contents Universities Academics and Industrialists
Investors and Three Dimensions Oxford Results and Tricks Universities in a Commercial Environment

4 Speakers message Knowledge transfer is stimulating communication between very different cultures The cultures will not in general spontaneously understand each other But there has always been the occasional multi linguist! Therefore intermediaries are required at least to start with It only works if the intermediaries have a real understanding of both cultures There is not a single recipe that always works But there are some underlying principles

5 What are Universities for?
Research & Teaching The creation and transmission of knowledge These both have a major economic impact Creative thinkers (in science, arts and humanities) A workforce trained in some useful areas But not all useful areas!

6 University Innovations
Range from inventions & new processes to new philosophies & political thought Most of this talk is about the former but let’s not forget the others They may well have a more profound long-term impact on our lives

7 Why is it difficult 1 - Academics
Universities have developed a self consistent set of values and behaviours which have enabled some of them to survive and prosper for a long time (Darwinian) This ethos can be summarised as: The pursuit, preservation, development and dissemination of knowledge Many of the most successful practitioners in universities are independent individuals who really see themselves as self-employed

8 Why is it difficult 2 - Industrialists
The commercial world has also developed a self consistent set of values and behaviours. These can be summarised under two headings Internal coherence All members of the company must have the same version of the master plan and work to it Management accountability The company is accountable to the shareholders and the employees to the company These are not the same as university values

9 The Challenge Commerce Researcher
Driven by external needs Clear goals with shareholder commitments Commercial confidentiality Researcher Self directed Next step defined by yesterday’s results Free exchange of ideas “Industry is out to cheat us” “Academics never deliver” So we can expect it will be challenging to build a mutually trusting relationship

10 Licence or consultancy
Orthogonal Value Sets 2D Intermediary Commercial axis Licence or consultancy Research -> Products Academic axis € ->Research

11 An additional challenge
If we are talking about spinout companies, rather than consultancy or licensing there is a third axis In addition to academia and industry there are investors Investors are not the same as industrialists

12 Why is it difficult 3 - Investors
Investors have yet a third set of values and behaviours, which again are self-consistent but differ from both industry and academia They evaluate an opportunity, invest, if it doesn’t perform they get out and try somewhere else and what happens to the firm is not their responsibility These are not the same as university or industrial values

13 The third axis 2D Intermediary Commercial axis Research -> Products
Spin-out Licence Research -> Products 3D Intermediary Investor axis Academic axis € ->Research € -> €€€

14 To summarise Investor Industrial Manager Academic Outsider Insider
Lots of concurrent activities One company One major interest Evaluate Invest Monitor Coordinated plan Coherent activity Route is undefined at the start If it’s not working get out fix it If it’s not working find a workaround

15 How it goes wrong A company signs a licence with a university
The company asks for a commitment that no-one in the University will work on anything that will devalue the company’s licence and the university will offer the company any improvements that any of its staff make to the original invention A year later a new academic joins the University who is a greater expert in the field than the original inventor Can the University tell him that all his future work in the field is restricted for the benefit of the company?

16 The clash This simple case exemplifies the issue:
The Academic does not see himself as a “bound employee” he feels he is essentially an “independent trader” On the other hand the company has paid the University and can reasonably expect that the University will not devalue the product that it has sold

17 The common currency The only real common values between these different civilisations are personal relationships What about money? Certainly they all deal in cash but the returns come in multiple currencies with undefined exchange rates Academic return Personal cash return Personal feel-good return I would like to spend a bit if time expanding on this because I believe it is the most important point I have to make

18 Academics Academics are our shareholders Academics are our customers
Isis Innovation is a wholly owned subsidiary of Oxford University Which is owned by the academics Academics are our customers We only get to transfer knowledge from the ones who choose to come to us Academics are our suppliers Our raw materials are their inventions So they have big impact on our future prospects

19 Initiation by researchers
All Isis Projects start with an approach from an academic Of course we devote much effort to internal marketing to researchers We make them welcome and they participate in all decisions but They have to decide to start any new project

20 Attracting Inventions
Least attractive Most attractive A = fn (S, C) A = Attractiveness of project S = Strength of science C = Commercialisability of academic Dr Quiet All the inventions in the University 0% %

21 The Beeson Gregory Project
Oxford needed a new Chemistry building costing €90m The Department had raised €15m If the University matched it government offered €45m So the University needed €30m Beeson-Gregory offered €30m for 50% of the University’s interest in Chemistry spinouts and licences for 15 years Was this a good deal for Oxford? 37

22 Requirements for intermediaries
Must understand both value systems Ideally should have lived in both Must be fluent in both vocabularies And able to translate Must be trusted by both sides So the academics will risk “being cheated” And the industrialists will risk “having their time wasted”

23 Sources of intermediaries
University technology transfer offices As long as they employ bilingual staff Diplomatically adept property owners Science parks, private developers Public sector (government officers) If they really do understand both values systems The Professionals Accountants, lawyers, consultants, investors, etc. As long as they can suspend their self-interest long enough for the creative interactions to start Divisive advisors inhibit the process Protect their client and kill the deal

24 Results in Oxford

25 Spinout Managers - The Rowing Boat

26 Spinout Managers - The Rowing Boat

27 Cashflow profiles b d a Cumulative Net cash in Time -> c

28 The difficulty In the long term it is in everybody’s interest But
In the short term the costs are from a single party

29 Culture Change Local professional environment
University & its technology transfer resource Local professional environment University entrepreneur culture All three must proceed together but the University must lead the change because.. The ideas are in the University If University provides TT resource,change will happen faster Oxford pre-Isis 1 spin-out every 4 years, post Isis 8 per year If the University doesn’t lead, the University may not receive its share of the benefits

30 The University Executive (policies) Tech transfer office Gene pool Commercially active scientists Other academics

31 Sub-culture in a barter economy
VC’s Lawyers Head hunters PR agents Real estate Leasing Banks Accountants Specialist suppliers Other start-ups Brokers Itinerant managers Consultants Students

32 Message for Government
We have some great universities If you fund research you get more and better research If you fund knowledge transfer you get more and better knowledge transfer This gives a better commercial return on the research spend and the return is disproportionately high because you are investing in an under-utilised asset (research results) PS badly managed research, or badly managed knowledge transfer is a waste of money but does not devalue properly managed research or knowledge transfer

33 Success Factors Do Don’t Expect it to be difficult
Work hard to understand the different civilisations Invest in the interface Use only intermediaries fluent in both value sets Focus on building trust (particularly with researchers) Don’t Tell them to understand each other (they won’t!) Think you will ever get it all right Despair

34 “Managing” your relationship with a university
The University You Like leading an elephant with a thin rubber band Walk along with the elephant In whichever direction it chooses to go Until it gets used to you Start to pull gently on your rubber band If you pull too hard or too suddenly You will break your rubber band and Have no further influence over the elephant 43

35 But Don’t think you will ever have complete control
Cartoon by Stoney, Ravette Publishing Tony Lopez (Copyright) 44

36 Contacts Ewert House Ewert Place Summertown Oxford OX2 7SG
Isis Innovation Ltd Ewert House Ewert Place Summertown Oxford OX2 7SG T E

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