However, this is only the beginning, as in the future an increasing number of researchers' ideas will be introduced into the market – seamless cooperation with the university's new Inno team and Think Company will play a key role.
Researchers have a unique opportunity: They can invent something that no one else has thought about – and thus create fruitful starting points for successful business. Jari Strandman knows this, as he has followed the journey of university-based companies to the market, as the CEO of Helsinki Innovation Services (HIS).
“When you conduct world-class basic research, you can discover matters that no one else has yet realised. They can possess big commercial potential,” says Strandman.
However, researchers' insights do not transform themselves into ingenious business ideas. A pipeline is needed, such as HIS, in which they can crystallise and come out as promising spinouts or licences.
The value of companies that have worked their way out to the world is calculated in hundreds of millions
HIS was established 10 years ago. Over the years, the commercialisation pipeline has created companies such as Nanoform, that splits pharmaceutical substances into small ones, which listed on the stock exchange in June 2020, Uute Scientific, which supports the immune system with natural microbes, and Valo Therapeutics, which promotes cancer treatment.
“The total value of the companies created in the pipeline is EUR 700–800 million, and they employ approximately 200 people,” estimates Strandman.
One of the latest success stories is GlucoModicum. It develops a small device for diabetics to monitor their glucose levels without blood tests. The device is based on an invention that allows the sampling of interstitial fluid from the skin, without needles and, based on the sample received, to monitor the amount of glucose in the blood.
“The customer base is 400 million diabetics in the world.”
Record number of new commercialisation projects
About 20 percent of the ideas and inventions involved in the preparation for commercialisation of HIS, will enter the market. Over the past five years, more than 30 inventions have been sold or licensed, with a total value of nearly EUR 5 million, before the royalty payments. Spinouts are also produced at a steady pace.
“On average, 2–5 companies a year,” calculates Strandman.
According to him, however, this is only the beginning. The university's new Inno team, HIS, and Think Company now bring together innovation and business collaboration services into a seamless entity, that helps provide more and more science-based innovations to the society.
Strandman explains that the HIS pipeline currently has twenty on-going commercialisation projects that receive Business Finland's Research to Business funding. This year, a record number of new projects will be launched, which is why HIS will enhance its services by employing six new employees.
“The profile of these people is strongly in business development.”
The aim is also to encourage more and more members of the academic community to submit idea and invention disclosures. During the existence of HIS, the number of disclosures has doubled to approximately 120 annual disclosures, but the number is hoped to rise to 200.
“A crucial part of the work is to inform researchers that this service exists.”
The university invests in spinouts for inventions to enter the market
Quaestor Marjo Berglund says that the university currently owns about twenty spinouts through its funds. Typically, companies receive initial capital of EUR 50,000 from the university at the start-up stage, which will enable them to find more investors and ensure that important products continue their journey to the market.
“For example, if the cancer vaccine were to remain in HIS’ invention shelf, it would not be right,” says Berglund and refers to the promising technology developed by Valo Therapeutics.
After the beginning, the university does not generally make additional investments in the companies. If the spinouts increase their value quickly, the university may already receive significant profits from them within five to ten years, to support research, teaching, and the emergence of new university-based companies.
For example, Nanoform's listing on the stock exchange, in 2020, provided EUR 20 million for the university. In turn, the sale of Mobidiag, a health technology company, to the United States, amounted to almost 50 million, which now enables new investments in innovation and business cooperation.
“Spinout activities have become part of our investment philosophy.”
Commercialisation of research is efficient use of common funds
Strandman believes that it is worth investing in the marketing of university-oriented ideas. Thus, the public money invested in basic research provide additional benefits, by creating inventions that revolutionise people's daily lives and secure the future.
“Innovations are a way for a people like the Finns to best preserve their well-being.”
One of the bottlenecks is attracting first investors to companies. Especially in medical and natural sciences, the journey from idea to product is slow and expensive. The challenge could be resolved by additional public funding, which could, for example, be used to continue the preparation of the commercialisation of medicines after the Research to Business phase.
Strandman reminds that Finland's target of raising RDI investments to 4 per cent is difficult to achieve without companies that bring turnover from entirely new areas. That is why top-level basic research, as well as the processing of inventions it creates into promising business ideas, is needed.
“One must have one's eyes on the horizon: Which will become the most potential commercial success stories?”
- The prerequisites for commercialisation are the idea and invention disclosures that HIS receives from researchers in Viikki, Kumpula, Meilahti, and the city centre campus. HIS assesses their potential: Can they solve a problem better than existing products?
- The property rights of an invention are determined in accordance with the Act on the Right in Inventions Made at Higher Education Institutions. HIS can only promote the commercialisation of innovations owned by the university. If the rights are granted to a researcher, they can hand them over to the university and be involved in the commercialisation process.
- HIS assists teams in applying for Business Finland's Research to Business funding for a promising idea or invention. It is used, for example, to test the functionality of an invention or to investigate the competitive situation in the market. At the same time, managers and investors for the company are being sought or licensing to the industry is prepared. The phase lasts 1–2 years and requires multi-million-euro investments.
- Finally, the success prospects of the new company will be assessed by the Commercialisation Advisory Board (CAB), led by Vice-Rector Paula Eerola, consisting of professionals in the investment world. If the committee shows a green light, a spinout company will be established, the owner of which will be not only the founding team but also the funds of the University of Helsinki.