Starting a company
Not all research is suited to becoming the platform for a new business. Oxford University Innovation can help evaluate the commercial opportunities of your research, including the potential for new company formation.
Setting up a spinout can be exciting, interesting and stimulating. It is also time-consuming, can be a stressful activity, and may distract you from your research.
This is how Prof Paul Newman (BP Professor of Information Engineering and co-founder of Oxbotica) describes his experience:
“I am having an absolute ball, it’s a rocket ride not a rollercoaster. I was surprised by the number of hours this takes, ‘epic’ does not come close.”
Participating in a spinout whilst remaining a University employee requires certain University consents and it often also involves significant legal responsibilities.
Spinouts involve multiple parties who bring much needed skills and resources but often have different objectives. Getting the right mix of technical, business and management skills along with the necessary resources is important.
How does Oxford University Innovation help?
Oxford University Innovation has worked in partnership with University of Oxford researchers in forming over 100 spinout companies, by contributing in three main areas:
business planning – the preparation of a business plan. This is the basis for the business and is also used by investors to determine whether to invest in the business opportunity
management – identifying a person to lead the team during the spin out process and building the team that will run the business thereafter
investment – raising the finance to get the opportunity off the ground through Oxford University Innovation networks
Oxford University procedures and policy
The University encourages the formation of spinouts where they are the best route to commercialize ideas.
Since 2015 the University and OUI have partnered with Oxford Science Enterprises plc (OSE) as the preferred source of capital for investment in new spinouts from Oxford’s MPLS and Medical Sciences divisions. OSE has raised more than £600M for this purpose, making it the largest investor globally that is tied to a single institution. For more information about the respective roles of OUI and OSE please see our FAQs. OSE has no exclusive rights to provide capital to new businesses but OUI will always recommend that you talk first to OSE before reaching out to other investors.
OSE has the right to see project information at an early stage, under conditions of confidentiality. If an academic founder wishes to receive an investment offer from OSE, and if OSE wishes to make one, OSE has up to 8 weeks exclusivity period to prepare and present a proposal. OUI recognises the benefit of a local, well resourced and well-connected investor, whether they are providing their capital investment or simply their views and advice on potential spin out projects. OSE and OUI work collaboratively with academic founders to consider, plan for and form new spin out companies. It is always the choice of an individual academic whether or not to work with OSE.
University employees have a number of rights and responsibilities in respect of commercializing intellectual property, and the University Statutes, Regulations and the Conflict of Interest policy are all relevant to your activities in spinning out a new company, as are the principles and procedures for determining founder equity in a new venture.
The University through its Intellectual Property Advisory Group (IPAG) determines the terms upon which University spinout companies are created. Oxford University Innovation is responsible for presenting all spinout opportunities to the University for approval to ensure that in situations where a conflict of interest may arise, necessary safeguards in place.
We at Oxford University Innovation will help to guide you through the relevant procedures, in conjunction with the appropriate University officers. The exact conditions of employment of University staff are University issues and we cannot adjudicate on them.
Developing an action plan
Once you have reviewed the spinout questionnaire (PDF, 59KB) and decided spinning-out would be the most appropriate path, it is important to develop an action plan that will guide you through the process. Your appointed manager will be able to assist you during this stage. You may be more interested in a social enterprise model, and OUI is able to help with this as an alternate route to spinning out.
‘Where do I start’ provides a list of tasks and actions that are essential. You would need to consider all of these as you develop an action plan. Although each venture will have unique characteristics and requirements, a draft action plan with eight generic steps is provided to facilitate the process.
Important considerations and other things you need to know
There are many important considerations for company formation which require up-to-date legal, taxation, accountancy and financial expertise from fully qualified and regulated professionals.
We have prepared this information to assist you in understanding the process of starting up a spinout company. Oxford University Innovation Ltd and its staff are, however, not regulated or approved to give advice on these matters. Accordingly, you should conduct your own investigations and obtain independent professional advice.
Find further information about appointing advisers, share dilution, directors responsibilities and sources of finance.
Not sure if you have a spinout?
There is plenty of help and advice out there, whether you have just an idea or a fully fledged business. Find the advice you need on our “Deciding whether to spinout” page