Sensible rules will support spectacular campus spin-outs

2 May 2017

The front door at Trinity College Dublin. Image: Aitormmfoto/Shutterstock

Clear-cut rules will eliminate any confusion around ownership of campus companies and spin-outs, writes John Kennedy.

If there is one true national sport in Ireland, in my opinion, it is politics.

We have many kinds of politics in Ireland, each one a poisonous art form: there’s office politics (usually naff and childish), small town politics (usually ho-hum, twee and hokey), political politics (usually something to do with your great-grandparents and what they were up to 100 years ago), media politics (usually ego-driven nonsense) and even academic politics (usually about grants, entitlements, territory and job titles). The list goes on.

The ongoing bun fight over the location and ownership of the pivotal National Maternity Hospital is an all-encompassing case in point that draws everyone in and divides them, no matter what their viewpoint is. And this proves my next point: the more you try to outrun politics, the more its talons will find and grip you.

As much as we are known as the land of a thousand welcomes, our tendency to turn on each other produces many bitter observations about such things as a prophet never being recognised in his or her own land, or failure being an orphan but success having many fathers.

U2 frontman Bono probably said it best in his own metaphor on success about the guy with the nice car and the house on the hill: “In the United States, you look at the guy that lives in the mansion on the hill, and you think, you know, one day, if I work really hard, I could live in that mansion. In Ireland, people look up at the guy in the mansion on the hill and go, one day, I’m going to get that bastard. It’s a different mindset.”

A fortnight ago, I tried to point out how a different mindset, particularly when it comes to understanding intellectual property, campus company ownership and college spin-outs is needed. This piece, which was entitled ‘Ireland risks sending a dangerous message to its innovators’, was published shortly after the president of WIT, Prof Willie Donnelly, was brought before the Dáil’s Committee of Public Accounts.

At the heart of the issue was the €64m sale price of FeedHenry, a spin-out from WIT’s TSSG campus, to US software giant Red Hat, and why just €1.3m was returned to WIT. There were also allegations of conflict of interest around the involvement of academics in the commercialisation of research.

Dr Graham Love, CEO of the Higher Education Authority, pointed out that there are national protocols on commercialisation of research in third-level colleges. He said that it is not unusual for a college’s shareholding in a spin-out to be diluted over time as external money is invested. A shareholding, he said, could typically fall from 10pc or 15pc down to 1pc or 2pc, indicating that WIT was actually above the average.

But, crucially, the key was academic ownership or management’s involvement in start-ups or spin-outs, and whether it is right or not that academic staff should have shares in these companies.

I pointed out the enormous success that TSSG has had in turning academic research into world-beating start-ups, and how it could be a template for other regions to follow.

I pointed out how any Stanford University professor worth his or her salt would recognise the model at WIT and TSSG as one not too dissimilar from their own way of working.

I pointed out that in the US, most tech professors are rated on their entrepreneurial exploits as much as on their academic prowess.

I pointed out how even the very question of academics not being entrepreneurs or shareholders in enterprises would be laughed off campus in America or other developed countries.

I pointed out how, in under 20 years, Ireland went from having virtually no technology transfer worth speaking of to being one of the most prolific R&D powerhouses for a nation of its size, and how Irish PhDs and SMEs were punching above their weight in terms of the EU’s Horizon 2020 initiative.

We need our academics to be entrepreneurial

My article was mostly well received but, in its aftermath, I also became aware that I had kicked a hornet’s nest too, prompting tweets, emails and Medium posts.

The Sinn Féin politician from Waterford, David Cullinane, TD, reached out to me and I promised him this right of reply. “We see the benefits from commercialising research in terms of local and regional development, as well as increasing the international stature of our education and research centres,” he wrote in an email.

“We see the benefits from commercialising research in terms of local and regional development, as well as increasing the international stature of our education and research centres.

“But you need rules. There has to be a level playing field for all researchers.

“The rules of an institution have to reflect this and they have to be followed. Conflicts of interests arise in any situation where you have a small number of people in multiple roles.

“The key issue is the management of those conflicts of interests in ways that are equitable and fair to all researchers and projects.

“Where questions arise where there might have been a potential issue surrounding the management of a possible conflict of interest, it is only right to seek answers.

“That is all that is happening here,” said Cullinane.

It is all part of growing up

Ireland has done a lot of growing up in the last 20 or 30 years across a range of moral and ethical issues. However, if you read any newspaper today, you will still feel the outrage or other emotions driven by the handling of what should be the most basic things, from water to medicine.

The argument that Cullinane raises about conflicts of interest and the need for clear rules on ownership around start-ups on campus is valid. I mean, what politician would not welcome 60 new jobs in the parish? He is doing his job as a public representative, raising issues that were obviously brought to his attention.

And he makes a reasonable point. Clear rules are needed so our academics and entrepreneurs can get on with the job, creating new technologies and businesses, fundamentally increasing the economic wellbeing of their regions.

Rules aren’t made to be broken, they are there to provide guidance and keep everyone honest. In Switzerland, the trains run on time. In Germany, if you do not have a driving licence, you do not drive a car.

As rapidly as Ireland’s academic prowess has been built up, the very argument Cullinane raises ought to be actually seen as an opportunity to get things right in at least one pivotal area.

Perhaps any argument for clarification of the protocols on commercialisation that Dr Love refers to couldn’t come at a better time.

Let’s see this as an opportunity to create a level playing field.

Let’s encourage, not stymie academic entrepreneurship.

Rather than seeing this as politics or academic politics, let’s see this as the opportunity it is.

Set the rules for spectacular college spin-outs.

And then, please, let’s all just get on with it.

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John Kennedy is a journalist who served as editor of Silicon Republic for 17 years