Welcome to Oxford Plus, the podcast series that takes you deep into the myths and
truths of the Oxford investing landscape.
I'm your host, Susannah de Jager, and I've spent over 15
years in UK asset management.
My guest today is Dave Norwood.
Dave graduated from Keeble College, Oxford, with a degree in modern history
and went into investment banking.
He has founded and been a director of numerous UK technology companies
including Oxford Nanopore, Proxy Imogen, Synergen, 4D Pharma, Index
IT, Evolution Group and Aura Capital.
Dave is also the founder of IP Group PLC and Oxford Science Innovation,
now Oxford Science Enterprises, the largest university venture
fund globally, which has brought in over 1.5 billion of investment into
Oxford since its inception in 2015.
Dave is also a grandmaster in chess and has represented both England
and Andorra internationally.
Without Dave, much of the investment landscape of Oxford would not look
how it does today, and so I'm looking forward to hearing his thoughts
and predictions as to what will and should change over the next 10 years.
Dave, thank you so much for joining today.
You're very welcome.
It's nice to be here.
Wonderful.
So, going back a few years now, you set up OSI.
I'd love to know what it was you identified that precipitated
the need to set up OSI, Oxford Science Innovation, as it then was.
That's a good question, sadly we'll have to go back a few more
years, I'm actually quite old.
So probably better we start further back because it then
will hopefully make more sense.
It really goes back to when I arrived at Oxford a long time ago, 1988, and
I read history, everyone assumes I read chemistry but I read history,
chemistry was too difficult for me.
I was surprised when I saw that.
I'll be honest, I'm one of those people.
Yeah.
I did sort of make friends with quite a few sort of scientists,
particularly when I also have a background in chess and most chess
players are good at maths or science.
So again, they don't tend to be historians and I kind of kept in touch with these
people after I'd left Oxford, and I sort of stumbled into the world of finance,
so I really didn't know what I was doing.
I didn't really want to do it, if I'm honest.
But what interested me was going back to Oxford, seeing my friends who were
going to do these research projects in various areas, and more and more, you
know, we'd be in the pub and I'd be like, so what are you planning to do?
Oh, I want to build this machine, or I've got this idea for a computer game, or...
and I just love to hear their stories and then they'd be like,
well, if only we could find £50,000, we could build a prototype and
so I'm like, well, you know what?
And I've always been a reasonable salesman.
So I sort of went.
and got some of the rich people I knew to just, in finance to put some money
into these early ideas in Oxford.
So it was a complete accident and they didn't even go particularly well.
But you know, I remember one guy introducing me to his tutor.
He said, my tutor can't believe you've raised this money.
He wants to, he really wants to meet you.
So I met him and he was a sort of very eminent professor and then he started
telling me more and more stories and about ideas in Oxford that there were
and he invited me to a dinner and it was actually a seminal moment in my life.
I got invited to a dinner and I'm going back now to probably about 1997 and it's a
very odd story actually because a few days before I actually got bitten by a snake.
That is not what I expected you to say.
Yeah, I know, that was it.
What kind of snake?
Yeah, it was an adder, I'd been for lunch in the Ashdown forest with a couple of
friends and we'd gone for a walk after.
That's spectacularly unlucky.
Well, it wasn't unlucky because I saw this adder and I was fascinated by
snakes, so I gently trod on its tail.
Yeah, looking back it was a silly thing to do, but I gently trod on its tail
and then started stroking its neck.
No you didn't!
I did, and then it turned around and bit me, and it was pretty horrific because
the blood sort of spurted out, but I thought it was a grass snake anyway,
so I wasn't particularly worried, it was only when my arm started to throb.
Anyway, we went back to the hotel where we'd had the lunch and I told
them I'd been bitten why one of the snakes in their garden and the guy
went paler than me and they rang for an ambulance and rushed me to hospital.
I literally nearly died because I had a terrible reaction,
spent almost a week in hospital.
So I got out of hospital and I had my arm in a sling.
So this professor had actually invited me to a High Table lunch at Queen's
and I was ringing him to say I can't go, I've been bitten by a snake and
I'm still not feeling very well, and I rung him and he was like, Oh, I'm so
pleased you rang me, you're going to meet this professor who's brilliant,
he's an amazing inventor, he'd love to meet you and I didn't have the heart
to say, well, actually I'm not coming.
So I thought well sod it, I'll just go, right, how bad can it be?
As usual, like really enjoying myself, we had a lovely meal at High Table,
lots of nice wine and then port and anyway, I was with my friend who's
Professor Pete Dobson, who actually built Begbroke really, was his project.
But he introduced me to this lovely old guy called Professor
Alan Hill, who obviously noticed that my arm was in a sling.
So I told him the story of the snake and I thought, what's odd is I thought I'd have
built some kind of immunity to being...
I've been bitten by like lots of things like mosquitoes and stuff in my life and
he goes, no, it's the opposite, you know?
And so I learned, Oh, you must be a chemist and you know, so he then started
telling me his story and his story was unbelievably romantic and truly
inspirational and he told me about this idea he'd had years and years ago, that
a way to sort of measure blood sugar levels and a bit of me being nice, I
said so what's that useful for you know?
And he goes, well it's funny you say that, at first that was my
thought, what is it useful for?
He said well it became useful when we realised that with a sort of tiny
prick of someone's finger, you know, you take a tiny amount of blood and
you can see what the glucose level is.
Which actually became a product which has revolutionised diabetes.
So if you know any diabetics, their lives have been transformed by the ability to
self test and it all came from Professor Alan Hill's idea all those years ago
and I remember hearing about it and I'm like, oh, that sounds interesting.
Why don't we create a company out of it?
And he said, well actually, he's a very modest bloke, he said, well I would
have loved to have done that, but we did create a company and we just sold
it for $890 million and I was like, wow, and he said, well it's interesting
though, like, you know, no one in the UK was particularly interested in it.
It was as usual, a US company and you know, I'm like yeah, and I
said well there's probably a lot of ideas like that in Oxford and he
goes, you just wouldn't believe it.
There were so many amazing ideas that could change the world, change
people's lives and even make money.
But actually he wasn't driven by the money, he was driven by the fact
that literally, you know, hundreds of millions of people now around the world
have had their lives improved by...
and that in some ways was the beginning of sort of self diagnostics, you know,
what we all got used to during COVID.
A lot of it can be traced back to Alan Hill and the chemistry department.
So, at least it gives you context as to why I was really interested and I
carried on doing, helping sort of spin outs from Oxford on an ad hoc basis,
until I found out that they were trying to build a new chemistry department.
So this is all at the end of the 90s and they'd raised a lot
of money from charities, the Wellcome Trust, the government.
But they were trying to build this brand new, they wanted to build like the most
modern chemistry department in the world.
Oxford Chemistry is ranked top in the world and they thought we need a
building that just looks fantastic.
But they were £20 million short.
So they came to me and said Dave, you're good at raising money.
We've seen you raise money for these little companies.
Why don't you raise us the 20 million pounds to help us
do the chemistry building?
So this is 1999 and I said, well what about, what do I get in return?
And they looked at me as if like, well, you don't know what you thought of that.
I said, well, here's an idea.
Why don't, in return for these £20 million, we would like to have a stake
in all the ideas that come out of that department forever and they're like,
well, forever's a very long time.
That's not going to work.
So we hammered out a long, interesting deal, which was basically, we would
share 50 50 with the university, the stakes in the ideas that came out for
the next 15 years and we finally did the deal in 2000, to go and raise £20
million and it meant Oxford were happy because they got to build the state of
the art chemistry department which is still there on South Parkes Road and we
then had 15 years to try and turn some of the ideas into something that works and
hopefully recoup that 20 million pounds and that was the beginning of IP group.
That was how IP group started and it was a very unusual deal.
It's the first deal of its kind and over those 15 years,
I've got to be honest, right?
There was lots of times where I thought, my God, this is the most stupid deal.
Why on earth have I done this?
And I realised that if I just sort of sat there and waited for the ideas to
come, they probably weren't going to come and I wasn't going to get my money back.
So I sort of moved back to Oxford and I literally spent every day, whether it
was taking a scientist to the coffee shop or dragging them over to the pub to hear
their ideas in the chemistry department because I thought we've really got to
work hard to make that stuff see the light of day and conveniently, when that
ended, the IP group deal ended in 2015, by this time I was long retired, right?
My friends were still running IP group, I'm sure you've met them,
but I'd long retired, I was still in touch with them, but only for catching
up over coffee or a glass of wine.
Oxford was saying, we've noticed that In that 15 years, more ideas have come out
of the chemistry department, pretty much all the other departments put together.
What was, why was that?
And I'm like, well because we cared, we really had to try and make it work.
So that was how the idea of Oxford Sciences came about.
It wasn't my idea, it was really a continuation of an idea that we'd all
sort of had all those years ago and Oxford said you know what, why don't we try and
do this experiment with every department?
So, we partner with Oxford, so rather than an IP group, which obviously has done
deals with lots of universities, we just want our own private commercialisation
vehicle, which we called OSI, it's now called OSE, or Oxford Science Enterprises
and then we said, right, we're not going to go out and raise 20 million this time,
we're going to be really ambitious and in the end, well, in total, we've probably
raised about a billion and Oxford has got the biggest, in effect, dedicated fund or
whatever you want to call it in the world.
But again, with the same mission that goes back to that amazing dinner I
had after I'd been bitten by a snake, which is find brilliant scientists
who've got ideas that can change the world and help them do it, right?
And so in effect, lots has changed, but nothing has changed.
That's really what we're trying to do.
Yeah that's exceptionally clear, particularly the snake bite.
So that completely resonates with what arguably one still sees a lot of today.
So my question to you would be, you know, we still see a lot of companies,
arguably at the stage you're talking about, still being sold to the US so,
we've got OSE and similar funds around the UK now that have emulated the same
sort of structure and they're functioning really well and yet, it still seems to be
the normal course, not without exception, Oxford Nanopore being an example, but
that most companies ultimately end up needing to take US money or listing on
the NASDAQ as a sort of default playbook and so, do you with your experience,
see anything additionally that we can do to change that as it's still evolving?
And I'll ask a different question later rather than lead the witness.
Yeah, no, it literally is the key question for me that I've wrestled
with all of my life, what you've asked me, and I don't have the answers.
I still think it's a great shame that the UK still does have incredible ideas and
yet we do not have the capital to allow the best of those ideas to go forward and
it's no use trying to pretend that we have and I've met with Prime Ministers, I've
met with different governments, every side of the political spectrum, and they all
recognise that they've got to do something about it and say they're going to do
something about it, but somehow something happens It doesn't happen , so...
I don't know what you're talking about Dave, I've never experienced this!
Must be some other government!
You know, they're all the same to me.
Nothing ever happens and it is kind of tragic and I think because of that
there isn't this belief that can sort of break this glass ceiling, you know...
It's self fulfilling.
Yeah.
I'm not of the mindset which is like, selling these companies to Americans
or the Chinese or it's necessarily a bad thing because what it does do
is it recycles capital, it's a great learning experience, it's a great sort
of role model for people to do, right?
Well, they sold for $500 million, we can do one better and sell for a billion.
So it's not all bad, and also when companies get bought, you know, you get
your second generation entrepreneurs.
I mean, one young lad, I'm not going to name him, one young lad who came
to work for me, you know, made a hundred million dollars from his spin
out and you know, so he has created a sort of role model here in Oxford
for someone who can do that, right?
You know, in my day, the only way you could become rich was to go into the city.
So to me, I'm a historian, so I see things in a very different, and these things
don't necessarily move fast, you know, it's not a, but yeah, the government
still doesn't really do enough, we know that, and it will talk a good game, and
if they are serious, and we, you know, whatever we are post Brexit, we want
to be an IP based economy, we really have to do some urgent work, right?
And like you say, you know, UK pension funds, I've talked about it, I've sat
on the patient capital review, and they're still not investing anything
like the amount we need to see this stuff work and if we don't make this
stuff work, what has the UK got?
You know, there's a bit like, it's nice to do this stuff because it's really
important to do things like cancer and we saw the impact of the COVID vaccine that
came out of Oxford, which was amazing.
I was so sort of proud to be involved in that in a small way.
So, you know, these things are incredibly important.
They're also the future of our economy and you know, even AI, I mean, you know,
AI, we could have an amazing role in the AI world because Oxford is becoming a
hub for AI ideas and I worry that we're going to miss that opportunity too.
And in your interactions with government, when you've gone and sort of pleaded
the case, what do you think the best intervention would be that they could do?
So I think there's actually two really important things and to
some extent they're separate and to some extent they're connected.
So I've looked at lots of US companies, obviously, you know, people quote
so many success stories in the US.
What's interesting about a lot of them is that they...
their first customers were actually government departments, or some
kind, like, you know, so this happens, and the Americans know how
to build companies, that's one thing we can't deny they do well, right?
But a lot of them get this amazing headstart where if they're doing
something really well, the government falls over itself to make sure that
kind of, I won't call it soft money because they've got it, but it goes
to them and they get their first customers so they can prove it works.
They can get money and scale up and it gives investors confidence and
actually, you know, just even in areas like genomics where I've worked a lot,
obviously, I was chairman of Oxford Nanopore in the early days, like you
know, the government come and see us and say yeah, we really want to help,
but could we get contracts out of them?
So to me, you know, the NHS is this unbelievable resource, but how much
does it really help UK startups?
It just is impossible.
So all this kind of value and where we could make a difference to how
we don't and it's kind of weird, we'd almost rather give contracts
to US companies than our own.
And by the way, you don't have to spend money to do that.
I feel like that's an important memo to anyone in government listening.
This won't cost you money.
This is a free solution.
it's almost like they're embarrassed to give it to their own, which
like bit of like benign nepotism would be a bad thing.
Well, the Americans have no qualms about it and obviously now they're
like, well we won't even give anything to China or anywhere else.
So like, so they have no qualms about backing their right?
Because they believe in ideas, they see the ideas create the world, right?
So it's like, so that frustrates me, right, so that...
and maybe if people saw that the government was more behind that, it'd be
easier to for instance, for pension funds to say right, we're now going to commit
10 percent say, to UK startups because we know, but you almost can't blame them
at times saying, well we don't want to commit money because they're never going
to be given a chance by the government.
You know it becomes this vicious cycle that needs to be broken.
So, you know, sorry, I feel I'm rambling a bit...
I think it's spot on.
In 30 years, I've created probably more spin outs than anyone ever and
that sounds like a boast and it's not because most of them have gone wrong.
But I would say if at critical moments we could have accessed the
contract, whether it's from even the Ministry of Defence or the, you know,
would have been transformational.
And it's not a flat playing field and that, you know, in my conversations,
much shorter dated rather than yours with government, it was a bit bizarre
that you almost had this conversation where they'd say, oh, well, you know, we
think it's a private sector problem and you'd say, but it's not and the playing
field isn't even, and Silicon Valley, lest we forget, was a defense project and
basically still is and the IRA, they're just pumping money into, you know, all of
these spinouts and by the way, poaching some of ours because great tax breaks and
you do go, to your point, if this is our plan, and we've you know, kind of slightly
ditched financial services for want of a better expression, we do need to realize
that we've got to fight for it, and that we're not just going to automatically
be given a seat at the table.
Exactly, exactly, and to me it's slightly heartbreaking because that's
all I've done with my life and we, you know, I'm not complaining, we've
had some nice success stories and I'm not starving just yet, but I would
have loved to have seen more impact.
But they all talk the talk, it doesn't matter whether you're
Labour or Conservative or whoever.
They all say that this is what they want to see and to be fair, there's been some
good things like VCT, EIS and stuff.
There's been these things are really great but...
Nothing moving the needle higher up the scale.
You've got it.
we can set these things up, but you know, you then want to get to that
scale of capital and it's just a desert,
Yeah.
Okay and so coming to, that kind of spin and we spoke earlier about, you know,
companies further up the spectrum being bought out by Americans, but something
that I've heard recently from a number of people I've interviewed and kind of
beyond is this thing of, because that capital isn't domestic, it's encouraging
a sort of VC playbook that is quite short term, that's flipping things
and that is actually, again, a self fulfilling prophecy that means that the
most ambitious companies don't get an opportunity to really flourish and so
if we want to build another Nanopore, to use an example you're familiar with,
and quite frankly, everyone is familiar with, actually that the capital that's
loop that we're in is a dampening effect and I'd be really interesting
to get your thoughts on that and if it can be sort of unpicked at all.
And it's actually got harder, I mean, like, because of geopolitical tensions.
You know, I was just out in Hong Kong two weeks ago, seeing some old friends,
and when I was last there, it was like eight years ago before COVID.
and raised a huge amount of money for Oxford over there and now there's a
feeling from them, they were lovely, you know, they were delighted to see me
and took me for some great dinners, but it was a bit like, well, you guys don't
really want to deal with us anymore.
You know, it's so...
We need more domestic capital for other reasons.
Yeah, so it's a bit like, well, we can't deal with China.
I got such grief for getting Huawei into Oxford Sciences, you know, I thought this
was, you know, one of the world's great big companies and things are, we're all
working well together and then suddenly it's become a sort of political problem.
and it's all very well, sure, we can ban China, we can ban
Saudi Arabia, we can ban anyone.
But then where's the money gonna go?
It's not making the life of the entrepreneurs on the ground any easier.
The scientists and the entrepreneurs were like, we want to be really ambitious.
Well, where are we going to get the money from?
Cause the US is tricky.
The US is very tricky.
We know that, you know, they're trying to get their capital, they do themselves,
they like to invest in their own stuff and they've done really well at it.
So, you know, they're interested in ideas to acquire at the right
point, but it's usually so they can build their big companies bigger.
You know, we've seen Google do this lots of times with, you know, the deep minds
of the world set up by, one of my oldest friends them is the expertise is here.
The expertise is in the UK, but you know is the finance and the ambition
because without the finance, you know, it's not very well being
ambitious, but if you've not got any...
the analogy is any petrol in the tank or whatever, you can't.
And these are very long, hard journeys, right?
They don't happen overnight.
Okay, and so, coming to something that is changing and, you know, the Mansion
House Compact has been signed by a number of key DC pensions, defined
contribution pensions, schemes, and many of the larger players in the insurance
buyout space and indeed lots of the consultants that advise those pension
funds and they are committing now to 5%, which I appreciate isn't 10%, and
it's certainly not what the Canadians have in their pension plans at 20%.
But 5 percent is still massive compared to where we are.
I think it's below 1 percent now.
So there is going to be more pension capital by 2030 and obviously DC
pension plans will be growing.
So call it that it might be 50, 60 billion, could be more
that's going to be coming in.
How do you see that impacting these problems and what do you think are
the kind of straight up positives and what do you think are perhaps
the bear traps that we need to look out for with that capital coming in?
Well, as you say, it's all about, you know, if we look at what
happens now, which is virtually nothing, it will be a quantum leap.
So, like you say, it's not 20 percent like Canada, but it's still an
enormous figure in the context...
Of a depressingly low one.
Exactly.
Still, no, I mean, you know, with those kinds of figures, we could
create some amazing companies.
I think, again, this will all be a little bit controversial.
We have to be careful and we've got to be honest.
So, IP Group went and did deals with, you know, all the universities pretty
much, you know, it was one thing that I probably had a dozen universities signed
up before I retired and it was great.
You know, we did say Frampton, we did Kings, Glasgow, and all
of them have got great ideas.
But even if we look at the US, right, the US has only really
got two or three clusters.
That's a fact and they're unbelievably good at it and unbelievably big.
But even they can't support, you know, there's only two really famous ones and
that's the valley in the MIT cluster and actually, I remember going to, I
think it was Gordon Brown, Tony Blair, so I'm going back a while, right?
And they were like, we saw your work with this IP group idea, you know, could we do
it with every single university in the UK?
And I'm like, well, to be honest, no.
And actually, I've probably done it with too many.
I should have probably stuck to Cambridge, London Cluster and Oxford.
And of course, it was like, well, that's not going to play well.
We, you know, what about Manchester?
I said, yeah, I love Manchester.
I'm from Manchester, for God's sake.
And, you know, but you won't necessarily get the scale and it's
not just about, you've got really good science, you know, a world leading
university, but if you don't get an ecosystem around it, it's difficult.
Yeah.
So, you know, let's say the UK only produced clusters in
London, Oxford and Cambridge.
That'd still be an amazing achievement that would transform the country.
But obviously they didn't want that, they were like that's political suicide
for us to be, you know, elitist.
This is elitist.
It's about creating the most powerful companies in the world with the best
science in the world, run by the best people in the world, you know.
So there's no, you know, it doesn't necessarily fit the
sort of levelling up idea.
Yeah.
That's my worry.
I'm brutally honest.
Right?
Well, they've been conflated almost, haven't they?
And they don't necessarily sit that comfortably in reality.
I think that's right.
And one can see why, because you have universities geographically spread
out, you have these great ideas.
It's a tempting thing to say therefore, hey, let's pump more money in and create
jobs and to some degree, it can be done, perhaps, but I had somebody called Mark
Preston and he is from the motorsports industry and we were talking about
the motorsports cluster and one of the things that he really highlighted, which
is pretty well understood, but it's very relevant to this conversation, is
just the high labor mobility and that if you move to Oxfordshire with your
family from anywhere in the world, as a brilliant motorsports, you know, F1,
Formula E, either an entrepreneur or somebody, joining one of the big teams,
if that doesn't work out, there are lots of other jobs here and that's the human
talent reality is that you don't want to move your family around willy nilly, but
moving them here for motorsports is easy.
So then you need to work out, right, well, what's adjacent to that?
What can we do that has that kind of translational experience where people
can say, well, this actually isn't too far away, so I feel comfortable
taking that job in Oxford too.
Spot on.
And I've actually seen that happen.
Like, even people who came with their families, like you say, they came from
the US with their families, went into one job, it didn't work out, or the science
didn't work, or the chemistry didn't work, and then within a few months they
were over the road at another start up.
And, you know, I used to just go to Boston and hang out there
for a few days and watch them.
I'd go to the bars, I'd meet some of the entrepreneurs and just listen to them.
I just listened.
Because I'm like you know what?
I'm not clever, they're clever.
What do you, know, and one of the best things that someone said to me It's like,
you know, you really need sort of three things to make an ecosystem work, three
things and I'm like, oh interesting, I'm gonna listen and he said the first
you need to have world class science.
Tick.
Done.
Secondly, it's got to be just a beautiful place, a nice place to live and I'm like,
well, that's good, oxford's got that.
The third, you've got to be able to walk everywhere and it's like,
Ooh, I like that too and that's how MIT sort of built that cluster.
You see them, they, you know, a scientist is there, you can walk over for coffee
with another engineer to give him a job interview, then you can walk over
and see a VC about raising $20 million to do whatever he wants to do and that
is the beauty of these ecosystems.
You've got to sort of create, and once it starts to work, it becomes
self referencing and self fulfilling.
But again, realistically, like, you know can we create an ecosystem
in all these university towns?
Of course we can't, it's nonsense.
We know we can't.
So coming back to kind of that point around how you build a cluster and
kind of cross pollination between industry and universities, I'd love
to get your thoughts on the Ellison Institute for Technology and how that's
going to change the landscape here.
Fantastic.
Just so exciting.
It is isn't it?
Just so exciting and I think just having someone coming into the ecosystem
like that and doing things a bit differently and shaking it up and it's
just amazing like, and I'm sort of so excited because, you know, here's
someone who's built, who's created success on a scale that we can never
imagine and it's fantastic to have that.
So I think that will, you know and it hopefully will encourage more people
who've won so big to think about doing stuff here, like people love Oxford.
Oxford's got this weird...
and if we could pull in some of that super talent, people who've got so
much more money that they don't need to worry about money or whatever, but
actually just want to see ideas work.
So I think we need to be bold.
I mean like, areas like DNA sequencing, I've spent most of my
life on that and AI again, I've spent most of my life observing that.
You know, the UK could really make a pitch to be world leading in one of probably
the three big areas in the world today.
I still think the sequencing of DNA is just everything.
AI is clearly going to change everything we do and quantum will
speed all of that up as well.
So you've got three areas that are converging and you know Oxford could be
a world leader in all three and people could start, like you say, with the
Ellison Institute, you could start to see that sort of stuff, Oh well, we want
to be part of this and not just part of it, we will bloody make it happen
because we know how to make it happen.
So giving some of these companies a bit of a rocket up their backsides,
because some of them do need it.
I mean, some of them are British as well, right?
We can't just keep blaming politicians, that's boring, right?
You know, everyone just moans or give them more money.
But, you know, I do think sometimes we're complacent, we don't try and
grow our companies as aggressively.
That's definitely something I've heard before, just that ambition
gap and it's a cliche, but it seems to be one for a reason.
I mean, again, I mean, I don't want to get into the politics of it all,
but it's almost slightly traumatizing that, you know, Moderna delivered a
vaccine and became worth, you know, 20 billion and we delivered a vaccine
and we didn't do anything out of it.
It's a slightly, of course, it was great because we hopefully saved millions of
lives and then helped particularly in the developing world because it was cheaper
and more easy to deliver., So it was great for humanity, but a bit of what we'd also
like to see a sort of, you know, a big unicorn win out of it, which is what...
And reinvestment back into the university that housed it.
Exactly, exactly, you know, that's it, you know, you start to see if this stuff
works, it just goes back into funding research and inspires that new generation
of scientists who can see, Oh, this lab was built by this success and that's what
I've spent my life trying to encourage people to do and at times you do feel
though that we're still sluggish, right?
So coming back to kind of Oxford and the ecosystem here which you referred
to, you were talking about kind of going across the road and meeting VCs
and obviously, OSE is a big source of investment funding for lots of
companies and you also spoke earlier about being cross department focused.
Now that we are where we are and it's all still evolving and you know, we've
got this amazing source of capital, do you still think that being cross
department and dare I say it, trying to do everything, which has a negative
inferrence I appreciate, is the best strategy or do you think that we need
to see more emergent kind of singularly focused funds coming into Oxford?
Yeah, good question.
I think we need to almost go back to sort of some philosophy, right?
I mean, that sounds a bit strange, but like...
I'll go with it.
Yeah, let me just give you a little anecdote.
So, in the early stages of COVID, one of my favourite pubs, probably my favourite
pub in the world, the first pub I ever had a pint in Oxford when I arrived
in 1988, was the Lamb and Flag and one of my old, friends, she sent me this
article in the BBC saying that the Lamb and Flag had closed because of COVID and
I thought, my God, this is like the end of an era, like, so many great evenings
there, where we had so much fun, but also so many serious evenings there, like, you
know, Nanopore you know, we had no money in the early days, we used to have our
board meetings in the pub, you know, in the early days of Nanopore and I just,
this is just such a tragedy, we lose his pub, we lose so much of our history.
Obviously he's got all the Tolkien and the C.S.
Lewis connection, which is unbelievably important, you know and I just remember
thinking, I've got to do something about this, and what I started doing,
I thought, why don't we set it up, not for profit, something that's
really about the community and about helping Oxford and bless them, St.
John's, I gave them the pitch and I think they thought I was completely
crazy and I said, I really want you to reopen this pub, but allow us to do it
differently and we'll set it up as...
we'll call it The Inklings, named after The Inklings, and we'll try and pull
together some of the best scientists, the best writers, the best entrepreneurs,
the best financers, we'll pull everyone in and anyway, long story short, we
signed up more than 300 Inklings, and St.
John's allowed us to take over, and we reopened the pub and some of those
300 names, some of them are famous authors, but a lot of them are world
leading scientists, particularly from the chemistry department and a lot of
them are world leading entrepreneurs who built big businesses and no one
was allowed to put in more than £10,000 and the minimum was only £1000, so it
was very democratic, no one could...
But what almost broke my heart was some of the messages from people who were
like no, I learned my first chemistry in there, I learned everything in that
pub, I learned more in there than in the labs and one guy built a business.
I'm not going to embarrass him by saying who it is, the business was valued at
four billion at the time and he said, I will, of course, I want to be involved,
I'm honored to be involved because it was such a big part of my research life,
that pub and he's gone on to build this amazing company and I just thought, you
know what, doing this sort of process, I suddenly thought there's so much
going on, there's so many people with ideas and history and actually I just
thought, you know what, if all we do is open this pub and some of them meet
each other, we'll have actually done a massive service to the ecosystem, so...
Well you joke, I've had people say on this podcast like, where
do you go to meet entrepreneurs?
You know, you bump into them on the street in the coffee shops in you know,
Silicon Valley or you know, as you were saying in Boston and people have literally
said, oh, you go to the Lamb and Flag.
And it is, you know, it's incredible.
I reckon I'm going to...
We are not sponsored by the Lamb and Flag by the way!
But I'll go there tonight and I'm certain I will bump into
entrepreneurs, CEOs, whatever.
So what is my dream?
What I want to see, because I'm thinking, oh, I'm 55, right?
I would want to see some young person in the Lamb and Flag, a scientist
who's got an idea that's going to change the world and meeting someone
who says, right, you know what?
I sold my business 5, 10 years ago, I've got half a billion dollars in
the bank and I'm going to back you and we're going to work together, I'll go
chair, you go CEO and we won't sell out quickly to whoever comes along, you
know, just, and I'll help you avoid the mistakes that I made and that's like...
So sort of peer to peer.
Exactly and you know, and it clearly won't work like that if it sounds twee
but you know, just seeing things like that Ellison Institute, you realise that that
magic rubs off, it becomes part of the DNA of Oxford and part of the Oxford story,
which for me is still incredibly romantic, there's been so many disappointments,
it's taken too long, and I'm still a believer that some of the best ideas
in the world are in Oxford, and at some point they will see the light of day,
you know, First Light Fusion is a dream.
If it works, it will be one of the most important companies ever, right, in the
history of the world, you know, we'll see if it works, I desperately pray it does,
but that's what you're playing for and if you have enough shots on goal like that.
So rather than these kind of slightly, let's build it, finance it, sell it
for a hundred two hundred, million or whatever, I would love to see
some dreaming again, you know, like some, Oxford is about dreaming.
That's the whole point, particularly if you're younger, but if you can have
young people who are brilliant with dreams, marrying up with older people
with money and experience, we could do some serious damage and I worry
that we've not, we mustn't lose that.
We've got to keep that magic.
That connectivity.
Exactly and like I say, people in the world, what do people want to do?
They want to have impact.
So actually, even though funding is difficult, everything's difficult,
if you've got a really good idea that will have positive impact on
the world, the chances are someone out there will help you get there.
And do you think that, you know, ironically, the kind of deal that's
in place with OSE that has this agreed IP for the ideas that come out, do
you think that has any dampening effect on those individuals thinking,
oh well it's already spoken for?
Obviously the intention isn't that, but I've definitely heard, I've definitely
heard suggest things along that line.
It's a good question.
Probably good to clarify this because I've probably heard every side of
the argument, again, not forever.
So I know that I'm not anything to do with anything, I can sort
of talk about it dispassionately.
So I mean, the way all the deals that were ever done, whether it was
IP group or OSI or CEOs there is, had a simple philosophy that they
only shared the university stake.
They never took anything off the scientists themselves,
that was the whole philosophy.
So theoretically, the scientists can never be any worse off because unfortunately,
when we did this Oxford deal, some kind of lots of strange things sort of started
to happen where people are like, well, the UK, the reason the UK because universities
are taking too much equity, which isn't interesting and obviously the scientists
love that idea because it's like, well, the university should have no equity or
maybe 5 percent and we'll get it all.
Well I think the spin out review has done quite a lot to break out
that myth and the fact that Irene Tracy was one of the co-authors.
Exactly.
But that was where it all kind of got conflated.
You know, there's something like, and I'm like, well, you know, we
get what we get, we just get half the university stake for which we've
committed a huge amount of capital.
We didn't get given it because you know, they got this massive stake and Oxford got
600 million for its projects, you know?
So, you know, so to me, I am still slightly of the...
at the end of the day, the university is a charity and if you are an employee
of the university and you come up with a brilliant idea, you should want the
university to have a big stake and actually, one of the things that I did was
to give my stake in OSI to the university, to my old college, because I thought,
well I don't want anyone thinking I'm here to try and make money and exploit
these scientists, so I actually gave it.
So it paid towards the H.
B.
Allen Center.
Okay.
Amazing.
And I actually really believe passionately that, you've got to want to...
the university, if you're there and a professor and you've had 20 years
there, why wouldn't you want the university to do well out of it?
It's going to pay for your labs, your students, it's...
so, I think the debate got very charged and very emotional and this, you know,
we could talk about it for hours, but I think they probably arrived at a
reasonable place, but I don't believe ever, sorry just to finish, I'll have
my rant here, this idea that, oh well that's why the UK's doing badly because
the universities gobbled all the equity, that's just bollocks, I'm sorry.
No and I agree with you and as I say, the spin out review has been very helpful to
sort of really open up what everyone's doing and compare it in broad daylight.
You know, kind of have the conversation in the open, such as we're doing here.
It does, from conversations I'm having, and I'm not subject to it,
but I don't think that people don't want the university to have it.
I think that there has been a sense that somehow the signaling power of having the
university is not somehow a positive thing and I guess I would say that out loud,
not because I necessarily agree with it, you know, part of the tagline of Oxford
Plus is to kind of dispel some of the myths and I would say this is a pretty
well propagated myth and I think that it's quite important that we are sort of
actively reaching out to people such as you've suggested, but also kind of, you
know, institutions, entities, and make sure that Oxford has the right reputation
as an investor, increasing the probability of success and I don't, truthfully,
really understand why that isn't the case.
It's an interesting one.
So I can only speak from my experience.
2015, I kind of came back and I retired when I turned 50, which was January 2019.
So I sort of had four years.
I think in that four years, you'd have to check the numbers, but I think
I'm probably confident that in that four years we created more spin outs
and raised more capital than in the last 20 years, just in four years.
Which is an extraordinary achievement.
So to me everyone, like, Oxford,
what I love about Oxford, right, you know, you've got 20,000 incredibly clever people
all disagreeing all the time, right?
So I've just learned to live with that.
But ultimately, numbers are numbers, right?
Since Oxford Sciences arrived, the figures, any kind of matrix,
anything you want to look at, just went through the roof.
You know, and funds came and invested in Oxford, who'd never invested in
Oxford, never even been to Oxford and I know that because I've brought a lot
of them here and they said, Oh, we've never been here, this is beautiful,
maybe we'll hang out here more,
you know?
So...
And are they still coming?
They're still coming, but again, so I'm not here to do an advert for OSC, right?
That's not, I left in 2019, I think, you know, it's still run by people who I'm
very good friends with, I've got a drink with one of the senior people tonight.
I think, you know, it's common knowledge OSC had some management issues, I left
and then they went through two CEOs and it all became a bit, you know, COVID hit, so
probably the personal thing wasn't there.
I think some of the scientists like, oh, we don't see OSC anymore.
I still can't get used to the name change as well so you know, we don't, whatever
they call it, we don't see them anymore.
So I think there was a bit of, you know, oh he's having a bit of a dark
patch, not to say that it was under a great patch with me under it.
I'm not trying to make that pointment, I think there was definitely some
internal strife, I think and I'm very hopeful they've got through that, I
hear good things again, I hear oh yeah, we saw them again last week and it's,
we, are all working together, so...
And actually I've got Ed Bussey coming on next week and I'm really
excited to hear what the plans are.
I'm very excited that, you know, there's a platform where, hopefully, further to this
conversation, we'll be able to dispel, in sort of real time and meet some of those,
not criticisms, that's too strong, but like, you know, get up in front of it.
I've always said, like I said, that's why I gave away my shares at the start.
So I was like, all I've ever wanted is to see brilliant ideas in Oxford
get out there into the world.
So if there's anything stopping that, I want to know about it.
like, so to me, but you know, I've not heard any...
Like anything isn't it?
You know, it takes years to win a good reputation, and it can be a short period
where, you know, you can lose it and we spoke about this on the way over here to
the studio, but I think it's incredibly easy to be a naysayer, and actually we
need to be part of people saying right, we can be more than the sum of our parts.
We've got a lot of good stuff here.
I love this, but pie makers and pie eaters, like everyone just wants the pie
to be bigger because then everyone does better rather than worrying about, you
know, everyone's little fiefdoms and I think it's really important that Oxford
and all of its stakeholders take some responsibility for being constructive.
100 percent agree and Oxford has got this weird, like, I love the
place, but it does have an amazing ability to be petty at times.
Yeah, I've seen it happen at a drinks party where it's like, you know,
that person's over there, right?
Are you serious that you're saying this?
And I was really shocked.
So, you know, we're all just got to get stronger and bigger and get on with it.
I don't live here anymore, so I miss the place and the main reason
I come back is to visit my pub, but you know, there's nothing I want to
see more in my life than these ideas work and Oxford reach its potential.
That's so important, right?
You know, again, on the way over, we were talking about cancer vaccines,
you're talking about blood sugar testing, you know, these are things
that change millions of lives and we all want to see it happen.
Absolutely and this place has got it.
You know, what do we know?
The world has got a lot of problems and we also know that a lot of the solutions
are in this beloved city of ours.
So, you know, we've just got to have that ambition to say, right, we're going to
go for it and nothing's going to stop us.
So when are we going to host the big Oxford conference when
we get everybody to come here?
You know what?
Again, maybe it was COVID, but we need to do more of that, you know, Oxford's
got some of the nicest buildings in the world, what they should be doing, and OSE
should be helping them and it's like, fill those buildings, fill them with the best
ideas in Oxford and the best people in the world, it's not complicated, that's what
needs to get done, and that's what I did.
I wore myself out doing it, you know, but I kind of, it's like, you know,
we're going to have another conference.
, We don't just want to talk about AI.
We want to show everyone what we've got, you know, and, if we think
we've got another Nanopore, it's like, here, this is what we've got,
and we have to be ambitious and give them nice dinners at High Table.
It doesn't matter if you're one of the richest people in the world.
It's so fabulous, it's such a treat.
Well, as we've seen with the Ellison Institute, people who are
successful beyond anything we can imagine still want to be involved
in these projects and that...
are hallowed halls, right?
It's a privilege to live here, it's a privilege to go into a college, it's
a privilege to be around people that their ideas have the potential to
change the world and all the rest of us need to do is get on board and be
helpful in whatever way we are capable.
It's funny you say that, it takes me back to, days when I'd just
arrived as an undergraduate and probably I was a bit cocky in those
days because I was a chess player.
You don't know what you don't know yet!
Yeah, you just think, you know, and like some people, Oh,
he's like a top chess player.
Yeah.
I mean, you have more reason than most.
Well, no, you know, and I remember like, I think he was the college stud,
he was a good looking guy, he was brilliant at sport and all that stuff
and he came up to, I think I wanted to join the squash team, he let me play
squash with him to give me a trial.
He said, you might make it into the third team, you know, so it was like a...
and I just remember him sort of walking by me and say, yeah, you've got a chess set?
I said, yeah, I don't know.
He said, what you need to understand about Oxford, he's like a year older
than me, he wasn't my tutor, you know he said, what you need to understand about
Oxford is no matter how big you think you are, it's so much bigger than you.
Actually it's not a bad point, you know, it's not a bad point.
No, I've said that to lots of people since I've moved here.
Thank you, Dave, this has been a really great conversation.
Is there anything else you want to add that you feel we haven't covered?
No, I suppose the only thing that, you know, lots of new ideas in therapeutics
and vaccines, there's no question, we need to see the convergence of AI with some
of our, you know, things like chemistry and drug libraries because that will
change everything, you know, the minute we start to use the power of generative
AI to do research faster, it will be transformational, particularly when you
sort of throw quantum computing into that.
So you start to think, well, if there's ever been a time in human history,
this is the historian in me sort of struggling to come out, I think
we're going to see the equivalent of, you know, a hundred industrial
revolutions in the next ten years.
Literally, that's what I believe, passionately and that could, a big part
of it could happen in Oxford and it only needs one idea to work in Oxford.
We've seen how big ideas are, like that's what the Americans have
taught us, you have one idea and it can be worth a couple of trillion.
So, you know, I'd love to see people dreaming again.
Like, the biggest ideas in the world, some of them are here, why
can't we have at least one that starts to have that ambition.
And just be ambitious.
Thank you.
Brilliant.
Thank you.
Thanks for listening to this episode of Oxford Plus, presented
by me, Susannah de Jager.
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