From Science to Business:  How Firms Create Value By Partnering With Universities

From Science to Business: How Firms Create Value By Partnering With Universities

By Georges Haour

In today’s so-called “knowledge” society, it is increasingly imperative for companies to effectively “mine” knowledge and technology generated by universities and public laboratories. Such collaborations contribute to creating new activities and jobs.

Companies tap into the new knowledge and technology generated by universities in various ways, from hiring graduates to giving endowments and commissioning contract research. The main vehicles for transferring knowledge and technology from universities to industry are: collaborative research, licensing and spinning out start up companies

Collaborative research

A small fraction of universities in Europe and the USA carry out collaborative research with companies. According to a 2012 OECD report, in the best cases, funding by the private sector represents only about 6% of the total research budget of these universities: the lion’s share of research funding comes from the public sector.


In patent-based licensing and/or selling intellectual property (IP), most universities do not generate enough income to cover the expenses of their technology licensing office. Small “blockbuster” deals are the exception to the rule and capture a lot of media attention. This is fine, since a university must choose the licensee that is most likely to create jobs form the innovation. In other words, universities must seek impact in society, rather than maximizing their revenues from their activities in technology transfer.

Creation of start up

Creating a start up, whose activities are based on the results of university research, is a complex process and universities do not have the required business sense for it. Indeed, they rightly concentrate on excellence in teaching and in research. Thus, they need a business partner to effectively turn the university research project into a commercial venture and a start up.

Firms engage with universities

Never before have non-business issues been so relevant to business. Industry and academia must team up to help move our world towards a more sustainable future. China, Germany and Japan have made substantial commitments in this direction. This journey requires transformations, which, in turn, demand myriads of innovations.

Companies must be more curious and make better use of the knowledge available in universities. Much of this input is non-technical, since never before have non-technical innovations been so critical to business success – novel business models or managerial practices, usually enabled by information and communication technologies.

Following are some examples:

  • Match firm’s needs with the appropriate institution.

    Once a company has defined its business development objectives, it must identify the institutions, and professors in these institutions, with which it should engage. The first time, this scouting will require much work, then it will be a matter of keeping it up to date; in any specialized field, the selected candidates will be a small number: Firms must make sure to include China and India in their scouting, as universities in these countries are increasingly possible contributors; in addition, they have the advantage to be located in large and dynamic markets.

  • Benefit from input from graduate students.

    Every year, the 40-staff start-up, HiFiCom (disguised name) in Copenhagen, welcomes 20 graduate students from a local engineering school. Managers from the company also do sessions for the Master’s course, which enables them to spot good candidates to work with the company on their Master’s thesis. A few of these students are hired, and as a result of the constant flow of fresh talent and their ideas for new commercial offerings, the company has been growing steadily.

  • Participate in collaborative research.

    HP has close to 100 collaborations with universities worldwide. Many of these are with leading Chinese universities. Part of the reason for this is that Chinese Universities are more “user-friendly” than their US counterparts, which are excessively greedy in their contractual conditions research.

  • Buy licence or IP:

    Geneva-based company NovImmune is active in therapeutic monoclonal antibodies to treat patients suffering from immune-related disorders. It relies on a license from the University of Geneva. With 85 staff, it is profitable and draws on an array of collaborations for innovative discoveries, in order to further develop its core activity.

  • Extend your business perimeter by buying a start up in a trade sale:

    The University of Cambridge, which was at the origin of seven start-ups in 2012, has had several successful spin outs, including Metalysis, which has commercialized a technological process to produce high-value, specialist metals and alloys used in the electronics, medical, marine, aerospace, chemical and defense sectors. The technology facilitates cheaper production with a significantly lower environmental impact.

Beyond financial returns, knowledge transfer presents benefits for universities, businesses, as well society as a whole. Collaborations with firms help universities focus their research on the needs of society and industry. Crucially, they often are at the origin of new activities, generating new jobs as a result. Firms must be better better connected with the University world, in order to be able to seize such opportunities.

This text is derived from a recent book by Georges Haour, titled: From Science to Business, published in 2011 by Palgrave MacMillan, in London. Georges is currently working on a new book: “Innovative China”.

** Editors Note: PreScouter, Inc is a Technology Scouting an Open Innovation Service helping to connect corporate innovation leaders to new technologies in many of the ways mentioned in the above article. They are dedicated to exposing the world to the innovations developed at universities. In doing so, they endeavor to increase commercialization of research from academia to industry**

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