Memorandum submitted by Oxford Innovation
Ltd
INTRODUCTION
Oxford Innovation Ltd is the UK's leading operator
of Innovation Centres—business incubation premises for technology
and knowledge based businesses—and is also Europe's leading
manager of technology Investment Networks that link innovative
new technology businesses with business angels, corporate venturers,
Venture Capital Trusts and other venture funds.
Oxford Innovation currently manages 13 Innovation
Centres with a total of some 350 companies based in those Centres.
Many of these Centres have benefited from public funding to pump
prime the activity, with most already being self-financing and
others on course to become self-financing over no more than two
to three years. A wholly private sector financed Innovation Centre
is due to open in late 2008 at Milton Park, Oxfordshire, to be
managed by Oxford Innovation.
Our response to this consultation is thus written
from an unusual perspective of a company that has a very high
proportion of its turnover dependent on entrepreneurs and innovative
start-up companies, and which also works with many publicly-funded
bodies that are seeking to encourage entrepreneurship, innovation
and knowledge transfer.
Over the last ten years we have worked on a
wide range of economic development and business support projects
for many of the RDAs.
THE EFFECTIVENESS
OF RDAS
AND THEIR
ROLE IN
ADDING VALUE
I am pleased to present three examples of projects
that we have worked on with three different RDAs, each of which
have been highly effective and have added significant value to
the regional economy and business community. The three examples
are described in the following sections.
1. BioCity Nottingham
BioCity Nottingham Ltd is a unique example of
strong collaboration between a Regional Development Agency (East
Midlands Development Agency), two universities (The Nottingham
Trent University and the University of Nottingham) and a major
international science-based company (BASF plc) to create a major
Bioscience and Healthcare Innovation Centre.
BioCity Nottingham was made possible by the
donation of pharmaceutical R&D facilities by BASF to Nottingham
Trent University. The premises consisting of over 100,000 sq ft
of laboratories would cost close to £50 million to build
and equip at today's prices. The gift is believed to be the largest-ever
corporate donation to a new university.
The Nottingham Trent University wisely decided
that it needed to work with partners in order to ensure the success
of BioCity Nottingham. The crucial partners in addition to BASF
were University of Nottingham with its strong Bioscience and Healthcare
research base and East Midlands Development Agency, which had
already identified Bioscience and Healthcare as a sector of particular
importance to the region. The objective of the partners is to
create an "engine" for regional economic development
that has a value in excess of £50 million to the regional
economy.
A careful process was undertaken to ensure that
the four organisations involved could all share common goals in
the development of BioCity and the way in which it would seek
to achieve maximum regional economic development effect in the
area of Bioscience and Healthcare.
There were many crucial steps in the successful
establishment of BioCity Nottingham Ltd, including: BASF's willingness
to underwrite running costs until the other partners had the opportunity
to develop a robust business plan and secure necessary funding;
a well designed and developed regional economic strategy from
EMDA that ensured that public funding could be made available
to help BioCity Nottingham to get established; the willingness
of the two universities to work together for common goals; selection
of specialist consultants, Oxford Innovation Ltd, who were capable
of facilitating the partners to reach shared goals, to help to
secure available funding to turn the ambitious goals into reality
and to manage the initial operation of BioCity. BioCity was then
in a strong enough position to recruit an outstanding Chief Executive,
Dr Glenn Crocker, to lead the future development of the operation.
The result is an initiative that has already
attracted over 50 Bioscience and Healthcare companies to establish
themselves in BioCity Nottingham (since opening in November 2002).
Many more Bioscience and Healthcare companies will be assisted
by BioCity Nottingham over the next few years.
The ultimate objective is for BioCity Nottingham
to create more than 5,000 jobs in the regional economy.
Because of its location in the middle of the East
Side regeneration area of the City of Nottingham, BioCity represents
a highly cost effective means of stimulating regeneration of a
less prosperous area of Nottingham.
2. The Innovation Technology Centre, South
Yorkshire
Oxford Innovation manages several notable Innovation
Centres in strategically important locations. These include the
Innovation Technology Centre on the Advanced Manufacturing Park
between Sheffield and Rotherham, which was once the site of the
Orgreave colliery and has now been transformed into a thriving
Park uniquely focussed on advanced manufacturing.
The initial focal point for this cluster of
activity was the Advanced Manufacturing Research Centre, established
jointly by University of Sheffield and Boeing. This has recently
expanded into a "Factory of the Future" established
by Rolls Royce, the University of Sheffield and Yorkshire Forward.
The Innovation Technology Centre (ITC) provides
27,000 sq ft of premises for innovative start ups in advanced
manufacturing, and a superb conference centre serving the Advanced
Manufacturing Park and advanced manufacturing business and research
establishments in the surrounding region.
The ITC is rapidly building a reputation as
the ideal location for innovative companies involved in new materials
and other aspects of advanced manufacturing. A range of measures
are deployed to help build the community of entrepreneurs, both
within the Innovation Centre and extending to the wider community
of advanced manufacturing entrepreneurs in South Yorkshire.
A new building, the Environmental Energy Technology
Centre (EETC) is currently being built adjacent to the ITC to
provide premises particularly for new low-carbon energy technology
companies. The Advanced Manufacturing Park, the ITC and the new
EETC are the result of a bold investment by Yorkshire Forward
which has already transformed the old colliery site and is now
being complemented by private investment in further buildings
on the Park.
3. Innovation Advisory Service South East
Over the last 10 years the Government has done
an excellent job in stimulating the supply side to be more willing
to spin out companies, and licence their intellectual property.
However, much less attention has been paid to the demand side
and it is clearly still disappointing that business demand for
university knowledge, expertise and intellectual property is still
quite low.
This issue was highlighted by the Lambert Review,
which led SEEDA to fund a new initiative—the Innovation
Advisory Service South East (IAS), managed by Oxford Innovation
and aimed at trying to increase demand from business for university
knowledge, expertise and intellectual property.
The IAS has been running for less than three
years, but already an interim evaluation undertaken for SEEDA
has found that the programme has achieved some very significant
impacts and led to substantial new business investment in R&D
and innovation.
One particular strength of the IAS has been
the way it has embraced and promoted the concept of "Open
Innovation", working with large businesses that are becoming
increasingly receptive to innovation from outside their own R&D
labs, and with small and medium sized companies that know they
need relationships with large partners in order for their innovations
to be commercially successful on a very substantial scale.
Open Innovation is perceived as an increasingly
important input to product and process development by many large
companies. As Open Innovation gains in popularity, it will lead
to large companies thinking more readily of universities and Public
Sector Research Establishments as viable sources of new technology,
but they will also look at innovative start-ups and SMEs, or indeed
at other large businesses, as potential suppliers.
With SEEDA's encouragement, Oxford Innovation
has developed the beginnings of an "Open Innovation market
place" in the south east of England. This can potentially
have a very positive effect on the economy of a region, by using
the presence of large companies within the region, and their willingness
to collaborate, as a lever for substantial economic development.
THE NEED
FOR A
LEVEL OF
ECONOMIC DEVELOPMENT
DELIVERY BETWEEN
CENTRAL AND
LOCAL GOVERNMENT
The three specific examples which we have quoted
each illustrate the need for regional rather than local thinking
in economic development. In the case of BioCity Nottingham, the
economic development effects are primarily local to Nottingham;
however, the facilities have attracted bioscience and health care
companies from throughout the East Midlands region, and indeed
from further afield, and the BioCity facility now acts as a regional
as well as a local resource for bioscience and healthcare companies.
Similarly the Advanced Manufacturing Park and the Innovation Technology
Centre (and the new Environmental Energy Technology Centre) are
regional as well as local resources acting as the flagship for
a regional renaissance in manufacturing industry, not simply a
means of generating more local employment.
The Innovation Advisory Service South East illustrates
even more clearly the value of working on a regional scale. It
is only by working on a more substantial scale that it is affordable
to have Innovation specialists covering a wide range of sectors
and with a wide range of business skills so that a sophisticated
service can be provided to some of the high growth potential companies
in the region and top level engagement can be achieved with the
technology-based multi-nationals of the region.
We are currently working in detail with SEEDA
to ensure that the best features of the Innovation Advisory Service
South East are preserved as the review of Sub-National Economic
Development and Regeneration goes forward. The challenge is to
maintain the economies of scale and the range of specialist skills
that can be achieved by a regional service while linking to local
delivery. SEEDA has consulted widely and taken the view that the
best way forward is to establish local "Innovation and Growth
Teams" that will be funded by SEEDA but closely accountable
to local government and to require that many of their existing
programmes, including the Innovation Advisory Service, "will
be delivered through sub-regional Innovation Teams" as stated
in their Corporate Plan 2008-11.
1 October 2008
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