Many universities these days are translating their academic breakthroughs to products and innovations that can be marketed. For example, years of research into understanding a certain phenomena in natural science could lead to a discovery that ought to be patented, and there-after licenced for application in industry. If this discovery is not licenced for use by other companies, researchers often seek to establish their own start-up company with the aim of developing that innovated product.
A university spin-off is ‘‘a new company founded to exploit a piece of intellectual property created in an academic institution’’ (Shane, 2004, p. 4).
In Europe, Asia and North America it is the norm to hear a handful or more companies established per University annualy with the aim of commercializing their research outputs. I wonder, to what extent is the performance of East African universities in establishing such start-up companies that are offshoots of university research? We have our DIT, UDSM, and KIST, how are their research-efforts performing in this respect?
It is a fact that many of our university academics are involved in consultancy activities outside their academic responsibilities in the university. While this is not necessarily a bad thing, I wonder why this vigour is lacking in the establishment of spin-off companies.
What is missing?
I believe it is high-time that we emphasize entrepreneurship skills to our M.Sc or even Bachelor degree students of technology, engineering and science. It would be appropriate if we integrate entrepreneurship courses and/or certificate programs in our universities that are open for non-commerce and non-business concentrators. Perhaps such courses should even be compulsory for engineering, technology and natural science students. Such a move would provide students those necessary tools for polishing their entrepreneurship skills, insights that might come-in handy when they develop research products with a commercial potential in the future.
The university must provide a supporting environment for knowledge transfer to ensure that a productive and profitable company is established. This is essential since for most spin-off companies universities do possess a stake in their holdings, and also an established spin-off company will carry the institution’s brand with it, therefore the university must ensure it is protected. Universities should therefore have local experts on patent laws, business, and technology who would provide the necessary advice and guidance when that potential innovation needs to be transformed for a market – not too late, not too early. It would be helpful if they also have a directory of venture-capital firms both local (if any) and foreign which provide that necessary investment for transforming on-the-bench discoveries to high-end industrial and marketable products.
The benefits of affiliation with a university,
in Xiaogang Peng, University spin-offs: Opportunity or challenge? Nature Materials 5, 923 – 925 (2006)
…..university technology incubators often support networking opportunities by bringing in venture-capital investors from outside the area, negotiating with the university and local government, fostering business culture in a local area, and offering legal and daily business assistance.
Generally speaking, university technology incubators are more vital for spin-off companies not located in traditional high-tech areas, and could therefore help to equalize the development level in different regions in an industrialized country. For developing countries, such as China and India, high-tech centres are rare. It may be a reasonable strategy for these countries to build up their high-tech innovation basis through university spin-off companies and technology incubators.
The relationship between a university and a high-tech spin-off company has the potential to result in a win–win situation for both parties, but the university must have appropriate procedures in place to manage a variety of conflict-of-interest issues. Such a procedure is necessary to protect both the university and any faculty members who may be involved with spin-off companies. The benefits received by universities that foster such companies include a dynamic and diverse research environment for faculty and students, additional training opportunities for students, funding from industry, fulfilment of their outreach commitment to the local government and federal funding agencies, and employment opportunities for graduating students from the university.
For the next fiscal year, the government of Tanzania has allocated some 20 million USD for research and development. Most of these funds go to support field-research conducted by our universities. However, there need to be additional financing schemes from the government for provision of grants to start-up companies that sprout from universities. Support from the government and other stakeholders will ensure the necessary development of the local university spin-offs sector and eventually sustain local science and technology.
Some may lamment and say our judicial system is not developed to support such ventures. Well, since 1999 commercial courts have been active in Tanzania and their presence together with an apt legislature will be beneficial in settling business disputes that may arise as spin-off companies become established here and there.
I do understand that the drive for research should not be for commercial interest only – some people perform research just for their passion of increasing human understanding, or for solving inherent social problems. The pressure for commercialization of research output can have negative impact on the maintainance of appropriate ethics of research conduct; for example some corrupt researchers may forge data just so as to make that ‘product-X efficiency plot‘ look statistically significant for an investors meeting. But such issues can be avoided by establishing apt laws, or emphasizing research ethics guidelines and even by the provision of necessary incentives to researchers in universities.
Our universities should put an emphasis on knowledge and technology transfer, with this they will increase revenue, create employment and develop a genuine local science that can even be exported.
COET, UDSM MBB, DIT, VETA, mpo?
What are your opinions on this matter with regards to the East African context? Is it easy to start a company within UDSM for example? What are the challenges?
- For an indepth analysis on this topic see: Academic Entrepreneurship: University spinoffs and wealth creation By Scott Shane
- For more information about entrepreneurship assistance at the University of Dar es Salaam, visit: www.udec.udsm.ac.tz