Growing and diversifying equity investment

Growing and diversifying the supply of equity investment into Oxfordshire-based science companies

Oxfordshire’s Innovation Engine 2023 (OIE), published by Advanced Oxford in June 2023, examined developments that have taken place in the equity/investment landscape in Oxfordshire over the last decade.  Some significant developments were noted, such as the creation of Oxford Science Enterprise (previously known as Oxford Sciences Innovation) and developments within angel investment systems   However, the report also noted weaknesses in the system.

Despite these changes, access to finance – particularly risk capital – continues to be a critical issue in ensuring the success of Oxfordshire’s innovation ecosystem.  Early-stage funding is likely to need particular attention particularly as we appear to be in a period of resetting, and many young companies are on a continuous treadmill of fund raising.  Most government intervention has been to support venture capital, but series B and later stage fundraising is still challenging in the UK – the £40+ million raises, and if companies are to be retained in the region, and indeed the UK, there is still a need to create the conditions and encourage UK institutional investors to back science and technology-based companies.

There is a need to see a growth in, and diversification of, finance options within the region, including attracting new players and funders into the ecosystem.  There is still a need to see recycling of money made from exits and to encourage new, active angel investors to work in the region.  Inward investment activities should also focus on encouraging investors to ‘put boots on the ground’ with long-term commitment to the ecosystem.

OIE 2023 made a specific recommendation relating to the investment environment within Oxfordshire: Grow and diversify the number of risk capital investors operating within the region.

The project is a response to this recommendation.

Advisory Board

Advanced Oxford has assembled an expert Advisory Board to support this work.  The role of this group is to guide the work; assist in defining the scope of the work; to advise on research activities, including access to data; to provide knowledge and connections/introductions to support qualitative data collection and analysis.

  • Jens Tholstrup, Executive Chair, Oxford Innovation Finance; Advanced Oxford board member; Trustee International Institute for Strategic Studies (IISS); Chair of Governors, St Clare’s, Oxford; Visiting Fellow at Kellogg College, Oxford
  • David Ford, active angel investor with over 25 years of global asset management experience, across both public and private markets
  • Andre Wierzbicki, corporate lawyer, asset management and private markets
  • Susannah de Jager, public markets investment management background, advisor to
    BOOST (Best Out Of Science and Technology) project and Founder of Oxford + podcast
  • Ceri Morgan, Leading advisor in public market Life science industry, portfolio NED and head of growth strategy for US, Canadian and UK companies
  • Peter Crane, former Venture Capital and CEO of a University of Oxford spin-out company (Caeruleus Therapeutics)
  • Nicki Campling, Director of Innovation and Operations, The Oxford Trust, formerly Barclays Corporate Banking and Ecosystem Manager, Barclays Oxford Eagle Lab
  • Nicola McConville, Partner, Mishcon de Reya, advisor to start-ups, spin-outs and companies raising investment; angel investor.
  • Sarah Haywood, Managing Director, Advanced Oxford
Data collection

The project will use a mix of qualitative and quantitative data, with data collection starting in 2024.

Qualitative data collection will use a mix of questionnaire and interview and will focus on issues relating to perceptions of the Oxfordshire ecosystem, sourcing deal flow, ease of doing business, signposting, landing points and incentives/barriers to operate within the Oxfordshire system.  Qualitative data will draw on the experiences of both companies operating within the region, company founders, and investors from different investor groups (angels, family offices, venture etc).

The project will build a long-term picture from the opportunity set, looking across all companies, not just University of Oxford spin-outs, to create a powerful pull factor – “why you need to come to Oxford to invest”.

Emerging issues and areas for examination
  • What is the perspective of start-ups (non-University generated, gestated and supported companies) versus university spin-outs? Do we have a two-tier system within the region?
  • How can we build a group of ‘Arch-angels’ – super angels that can bring expertise, as well as recycling money within the ecosystem? Is there a role for the creation of ‘special interest’ groups, or events that bring super-angels together?
  • How can we encourage more family offices to operate and look for deal flow within Oxfordshire?
  • What do non-Oxford/Oxfordshire investors see or perceive when they think about investment opportunities here? How does this compare to other innovation environments?
  • How does a US VC firm who has no connection to Oxford/Oxfordshire “start” here?
  • Scale-up capital and public-markets (London Stock Exchange) are perceived to be weaknesses within the UK funding environment. The project will consider if there are issues that we can usefully explore, in terms of identifying actions/levers.
  • Are there UK-wide policy issues that need to be addressed?
  • Does company and investor behaviour drive companies towards exit, rather than building and scaling successful companies?

If you would like further information about this project, or are interested in participating in the research, please contact Sarah Haywood ([email protected]).

 

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