Navigating Investment Changes in a Rapidly Evolving World
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Understanding the Shift in Investment Paradigms
In my educational journey, the concept of investing was largely confined to purchasing shares in corporations or real estate. While the emergence of the Bitcoin ecosystem has introduced innovative tools, the fundamental premise of investing has largely remained intact. For many, investing continues to mean acquiring stock in companies or real estate. Nevertheless, the collapse of FTX has dampened enthusiasm in the cryptocurrency sector.
The way individuals interact today has undergone significant technological evolution.
The Evolution of Venture Capital in the Digital Age
Before 1994, mobile phones were a rarity. I recall joking about those who carried large briefcases solely to make calls on the go.
In the mid-90s, advancements in mobile technology enabled everyone to carry a phone in their pocket. The Cern Institute's decision to make the World Wide Web publicly accessible laid the groundwork for tech giants like Amazon, Google, and Facebook.
Google has made vast amounts of information readily available with just a click, while tools like ChatGPT facilitate more intuitive interactions with AI.
What implications do these advancements and tools have for how venture capitalists conduct their business?
Find insights in this article authored by a partner at Earlybird Ventures.
European DeepTech Startups: Opportunities and Challenges
The pressing issues of our times are intricate and demand intellectual solutions. Companies that translate scientific discoveries into practical applications are referred to as DeepTech firms.
What is the current landscape for European DeepTech?
How do European universities measure up in terms of innovation?
Who are the key investors in the European deep tech space?
Answers to these questions can be found in the latest report from Dealroom.
Navigating the Spinout Dilemma in Deep Tech
Are university spinouts impeding the advancement of groundbreaking technology for society? As investments in university spinouts rise, tension increases regarding the relationship between academic entrepreneurs and their institutions.
One biotech startup, Oxford Nanoimaging, is currently engaged in a legal dispute with Oxford University concerning royalty payments. The founder, Bo Jing, contends that universities often overstate their contributions to spinouts, contributing little compared to the significant efforts invested by entrepreneurs.
The critical question remains: do university spinouts facilitate or obstruct the commercialization of advanced research and the resolution of global challenges? This inquiry has lingered with me since I was involved in founding the first deep tech companies back in 2006.
I've encountered a wide range of deal proposals from technology transfer offices—ranging from a 90% equity claim for "donating" intellectual property to the company, to modest royalty arrangements of 5% to 15% on future revenues generated by the company through product sales or technology licensing.
In my view, the majority of European intellectual property is funded by taxpayers. The founders dedicate their lives to advancing technology and are wholly focused on ensuring their companies succeed. It is in the best interest of universities to provide robust support to their founders:
Implementing royalty rates of 5–15% for licensing or transferring intellectual property to startups.
Taking equity stakes when investing capital in standard seed funding arrangements.
Ensuring that any additional services provided to the company are based on transparent fee-for-service contracts.
Ultimately, European universities have a long-term existence, and backloaded deal structures tend to benefit both parties. This arrangement allows founders to progress efficiently while ensuring that inventors retain substantial rights to returns on their intellectual property.
Motivating founders to drive their innovations forward is essential for success.
