Five years ago, we were a different world. Former Chancellor Philip Hammond had just committed £23bn to a National Innovation and Infrastructure fund to catalyse private sector investment. We were still in the EU and COVID-19 was in the distant future.
Since 2016, we’ve demonstrated the principle of investing in British innovation. Oxford remains the world’s top ranked university. The Oxford-AstraZeneca COVID vaccine is proof that UK university-led ventures can be profitable and impactful upon global challenges.
Now, with Abu Dhabi and the UK partnering to invest millions in new technologies, the Government needs to strongly capitalise on our success. We need to bring global investors, public funding and entrepreneurs together to make Britain a technological and science superpower on the world stage.
Point proved
Brits have a reputation for letting home-grown inventions slip through our fingers. We’re often seen as understated inventors, unwilling to commercialise, and with a tendency to fail to recognise marketable talent.
Back in 2016, I argued that British inventiveness had significantly contributed to the success of two of the world’s biggest companies – Google and Apple. Yet, as a country, we only captured a fraction of that value, with much of the profit realised overseas.
Today Vaccitech, the university start-up behind the Oxford-AstraZeneca COVID vaccine, is one of the many companies showing how Britain can profitably address global challenges in areas such as healthcare, clean energy and infrastructure.
Vaccitech is developing new drugs to fight cancer and other infectious diseases that could emerge as global threats. The company recently secured its largest private investment, $168 million to take three therapies into first-in-human studies. Vaccitech isn’t alone. Another blockbuster British biotech, Oxford Nanopore, is about to list on the UK stock market. Its rapid COVID-19 tests have proved critical to the pandemic response in Britain and elsewhere.
Taking success forwards: Priming the pump
So, what can we do to build on this success? The Government needs to continue to fund the best of British inventiveness.
The UK Innovation & Science Seed Fund (UKI2S) is a great example of how public money can help boost strategically-important sectors of the economy and help innovative new technologies reach a global market.
UKI2S invests Government funding in innovative, often risky, research with global implications. Among the rising global stars in their portfolio is Tropic Biosciences in Norwich, who are using cutting-edge science to save the humble banana from a fruit-ending pandemic disease.
Another company in their portfolio, Tokamak Energy, near Oxford, is leading global efforts to commercialise the holy grail of energy production – fusion power, with the aim of providing a source of limitless clean power.
Attracting overseas investment
Yet, Government funding can only prime the pump for private sector investment. And, to make the most of our technologies, we need the rest of the world to recognise our potential and to invest in the UK.
In late March, the Financial Times reported that the United Arab Emirates had agreed a multibillion-pound investment partnership with the UK. This includes £800m from Abu Dhabi state fund, Mubadala, to invest in life sciences, to be matched by £200m from the UK.
It’s a huge boost to UK innovation, and to post-Brexit Britain. The Vice-Chancellors of Oxford and Cambridge both had concerns about losing funding from Horizon, the European funding agency, but – in fact – the appetite of international investors, with an estimated £5bn from a single sovereign wealth fund, should more than compensate for the shortfall.
As public sector funding, Horizon is a distraction. The profit-first approach to funding innovation is always going to produce better results.
Replicating Silicon Valley
Around the world, there are multiple innovation ‘hot spots’ where new companies are born ready to meet a global market.
Professor Jerome S. Engel, from the University of California, Berkeley and an advisor to Future Planet Capital, calls them Clusters of Innovation – “global economic hot spots where new technologies germinate at an astounding rate and where pools of capital, expertise, and talent foster the development of new industries and new ways of doing business.”
One such example is Silicon Valley. And, through two decades of study, he has distilled the elements that make this tech cluster a worldwide success.
US Government funding contributed, of course, to the stratospheric rise of California’s tech industry. The Advanced Research Projects Agency (ARPA) funded the developers of ARPANET, the first computer network designed with the foundational technologies that underpin today’s World Wide Web.
But private sector funding was also critical to superpowering today’s Silicon Valley, along with a culture of entrepreneurship.
Can we turn Britain into a superpowered version of Silicon Valley? Certainly. Lord Gerry Grimstone, the UK’s investment minister, is not alone in thinking – as he told the FT – that the future opportunities are sizeable.
We have top universities, world-beating research, and a burgeoning culture of commercialising inventiveness.
A decade ago, David Willetts talked about the eight great technologies that would propel Britain forwards. Five years ago, I talked about driving Britain’s ‘innovation mojo’. Now, let’s go and do it.
Our future place in the world will not be defined by our warheads, but by the inventiveness of our minds.
Douglas Hansen-Luke is the Executive Chairman of Future Planet Capital, where he is focused on connecting the world’s large investors, including sovereign wealth funds, with hard-to-access opportunities in technology and life sciences. Previously, he has held senior managerial positions across the Middle East and Asia and also stood as a Parliamentary Candidate at the 2015 UK General Election. Future Planet Capital is the third largest investor in Vaccitech after the University of Oxford and M&G plc, and is partnered with Midven, the manager of UK Innovation & Science Seed Fund.
