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24 May 2017

Global university venture funding blooms

Foreword by Douglas Hansen-Luke Managing Partner, Future Planet Capital

Author: Douglas Hansen-Luke, Future Planet Capital

Throughout the past four years, Global University Venturing (GUV) has not simply followed developments in university venture: it has been at the forefront the trend, doing more than perhaps any other entity to highlight the importance of leading academic institutions within start up investment ecosystems.

This significant new report marks an important step in improving and enriching investors’ understanding of this rapidly evolving sector. As well as providing an international overview of significant university venture investors, the study begins to categorise and classify this heterogeneous group. They employ widely varying structures, ranging from classic models to more evergreen limited liability partnerships (LLPs), garner funding from different sources and interact with universities, their tech transfer offices and the surrounding clusters in very different ways.

In addition, GUV and this report provide what very few university venture specialists or experts offer: a truly global perspective. Here we see the full gamut of international university venture, ranging from old bastions such as Oxford to pioneers like Tsinghua and Peking universities, which are helping to accelerate China’s path to the production and commercialisation of world-leading scientific research.

Pockets of scientific and technological innovation tend to be rather like villages, isolated and somewhat disconnected from the broader international picture. The funding is usually provided by domestic investors; the primary focus for start ups is usually the domestic market. Yet international networking effects, business partners and markets can often be the key to unlocking commercial success.

A global approach opens new doors, both for the leading companies of the future and for the investors of the present who wish to harness the returns of innovation on a broader scale. It also provides something else: greater potential for tackling the world’s most significant social, environmental and economic challenges.

After all, investing in innovation – and what is venture but economically productive innovation? – is about more than financial returns. It offers a way of changing the world for the better by nurturing companies that will provide transformative technologies to address climate change, education, healthcare, security, sustainable growth and much more besides.

Impact also lies at the heart of Future Planet Capital’s global university innovation investment strategy. We believe that connecting the world’s largest investors with the world’s best minds will positively impact on the challenges facing humanity today. Through a unique series of partnerships with top-tier university accelerators and funds in Asia, Europe and the US, our firm possesses an unrivalled breadth of access to technology and life science firms that emerge from academic institutions and the clusters of innovation that surround them.

The Future Planet Fund has been designed in close conjunction with sophisticated investors to provide multi-stage access to startups, spin-outs and growing companies, at a scale large enough to suit major sovereign wealth funds and similar institutions.

Indeed, large institutional investors have become increasingly interested in innovation and venture. There are multiple reasons for this trend. Most simply, it offers a way of enhancing performance in a world of low public market returns. It can even provide a window into disruptive advances that may affect wider investment strategy (see Pursuing Innovation: Sovereign Wealth Funds and Technology Investment [Engel, Hamirani & Saklatvala 2016]). For those with a strategic mission to support their country’s development, it gives unique ways of enhancing or diversifying the domestic economy, such as fostering collaboration between local energy companies and new energy innovators.

Such investors are largely agnostic about geographical investment destination but rather seek the best research and returns wherever they may be, making a global perspective – such as that provided in this report - even more relevant.

We are proud to support the publication of and trust that readers will find it insightful, practically useful – and most of all inspiring as it sets out the progress and the potential of Global University Venture.

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