The Smartest Innovation you’ve Never Heard of
Scientific Venture Creation could be the smartest innovation you’ve never heard of.
Harnessing cutting-edge scientific research can help all kinds of organisations go beyond simply keeping up with the competition - it can help revitalise, redefine and revolutionise entire industries. For organisations able to translate research into new commercial approaches, there are a wide range of benefits just waiting to be unlocked, including
● Meeting specific strategic challenges for organisations or industries through new approaches, products and processes
● Boosting sustainability to future-proof operations
● Finding a competitive advantage through innovation, and becoming established as a market leader
● Increasing profitability through outside-the-box approaches which deliver efficiency
● Maintaining leading talent by ensuring new insights and technologies have the space and support to grow into real-world solutions
It’s not enough to simply keep up - by incorporating the latest research, organisations of many different kinds have the opportunity to go beyond what’s possible right now and redefine the way they operate. Competitors will scramble to keep up.
Getting the research out of the lab
However, the problem of getting cutting-edge research out of the lab and into innovations which are ready to be put to use meeting strategic, technological and industry challenges is a difficult one. Historically, we’ve seen organisations apply three main approaches to incorporating scientific research into their operations.
Internal research and development
An organisation’s own research and development (R&D) team has the advantage of being deeply aligned with their operations, capabilities and needs, and hyper-focused on business goals. In addition, internal R&D ensures an organisation will have control over the new approaches and technology they develop, and ownership of the innovation they foster. However, internal R&D teams tend to have limited resources and expertise which can lead to a narrow approach. Organisations might miss out on transformative opportunities because they lie outside the bandwidth or expertise of the in-house team, or fail to realise the full potential of their innovation.
Acquiring scientific ventures through mergers and acquisitions
Finding existing scientific ventures to incorporate into an organisation through mergers and acquisitions (M&A) delivers some of the same benefits of internal development such as ensuring control and ownership, but brings
an additional advantage because organisations can seek out and acquire more mature ventures, reducing the time it takes to see impact from them. However, acquiring scientific innovations at this later stage significantly inflates their cost, and raises the risk of a venture developing in a way that isn’t aligned with the acquirer’s goals. And what if exactly what a particular organisation needs doesn’t exist yet?
Corporate venture capital
Somewhere between internal R&D and acquiring ventures through M&A is corporate venture capital. While early-stage, partial investment allows organisations to ensure a closer fit between the venture and their business objectives while managing costs, there are still some drawbacks. This approach unfolds over a longer timeline, with a greater degree of risk, and it can be difficult to secure relevant deal flow. Unlike internal R&D, corporate venture capital also introduces competition. For potentially transformational ventures, there may be many, many organisations who want a piece of the action. And once a relationship is in place, care is needed to ensure that the cultural differences between early stage ventures of startups and larger corporate organisations are managed appropriately.
Between the limited scope of internal R&D, the higher cost and potentially lower alignment of M&A and the competition of corporate venture capital, incorporating scientific innovation into corporate organisations is a big challenge. But there is a new approach which can complement these tactics and deliver truly transformational outcomes: Scientific Venture Creation
Scientific Venture Creation: commercialising cutting-edge science
Cambridge Future Tech builds deep tech innovations into world leading ventures. Part of our mission involves helping our partners meet their strategic objectives by building and nurturing de-risked, science-backed ventures tailored to fit their needs. The CFT approach brings together all the key elements of a successful, research-backed venture so we can get cutting-edge science out of the lab and start solving the most pressing questions innovative companies face. We assemble:
● Research, whether scouted from university labs or an organisation’s own internal IP, as well as considering new applications for existing innovation
● People, with the expertise and skill to realise the value of that research
● Domain expertise, including vital insights from our industry partners, to ensure solutions are a good fit for the problem at hand and the markets in which our clients operate
● Process, to rigorously de-risk the new ventures and accelerate their innovations towards impact
Our clients are using this approach right now to support ambitious responses to industry challenges, and to lead the way with revolutionary new approaches.
How it works
We work with our partners over multiple cycles of venture building, putting together an average of ten ventures within each Scientific Venture Studio. This diversified approach is a key part of de-risking the venture creation process. While not all the ventures we build together will come to maturity (though we have a 100% track record so far), we’ve honed our process across our client base and we can help you strike the right balance for success. Together we generate impact from day one - the launch of each branded venture is a statement of your commitment to your corporate objectives which you can share with your whole stakeholder community.
Let’s take a closer look at how a Scientific Venture Studio typically runs. For each venture, we go through four phases.
Phase One: selecting a topic
We start by defining desired corporate outcomes. This can vary from organisation to organisation, but might include
● Meeting a commercial or industry challenge by harnessing new research. Whether it’s revolutionising industrial processes to make them sustainable for the future, finding or maintaining a competitive edge or redefining the conversation as a market leader, we can work together with our partners to respond to a challenge or requirement which their organisation faces
● Getting value out of existing IP by undertaking a detailed analysis of an organisation’s internal research and IP to uncover hidden gems which have the potential to grow into transformational technology, processes, practices, etc
● Market entry and market disruption, by harnessing new or underexploited research to turn industries on their head, expand an organisations’ reach into other markets, or create entirely new markets full of opportunity
Phase two: generating opportunities
Once we’ve interrogated and defined your commercial needs, we then assemble everything we’ll need to build new scientific ventures. This often includes scouting for appropriate research and IP, undertaking market research and due diligence to ensure fit and putting together a team. During this phase, we often consider hundreds of potential opportunities to select the right ones for you. We work to secure innovations to make sure they can attract strong talent and stand up against the competition.
Phase three: venture building
We now focus on transforming science into robust new ventures which are well-equipped to deliver impact in a short timeframe. In this phase, research is spun out from labs and de-risked. CFT acts as a rounded interim C-suite, undertaking tasks including building teams, refining strategy, locking in governance, and securing funding. At the conclusion of this process, we leave behind a fully funded and staffed venture aligned to your needs and corporate goals, with a clear and de-risked path to market.
The benefits
So why does a longer-term engagement with Scientific Venture Creation in partnership with CFT represent such a valuable complement to more traditional approaches to innovation, such as internal R&D, M&A or corporate venture capital?
● Ensure innovation is aligned with your objectives by creating ventures which fit your needs, and maintaining a close relationship with them as they develop so you stay aligned into the future
● A de-risked process to scout and develop disruptive solutions against a strong foundation of domain and market expertise - we help you establish that the market is ready and the solution is appropriate. We also bring our skill and experience in creating and supporting ventures as businesses to ensure they’re robust and ready to deliver strategic value
● Balance corporate and startup culture, to ensure both close alignment and the space ventures need to grow, while delivering the capital efficiency and speed of a startup environment
● Beat the competition with first right of refusal for ventures you nurture from the ground up
● Excellent ROI, with investments typically becoming balance sheet positive within four years, and huge IRR value creation
See it in action
CFT has partnered with some of the world’s largest organisations to build ventures which produce truly disruptive innovations. Some examples from our own portfolio include healthtech pioneer OmniBuds whose ear-worn computing platform brings state-of-the-art research technology from the laboratory into everyday life, and PeroCycle who are working to decarbonise the steel industry for a more sustainable future.
To learn more about the kinds of ventures CFT has developed alongside our partners, take a look at our Portfolio page.