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