BioWorld International Correspondent
LONDON - The quoted technology commercialization company IP Group plc is spreading its wings and setting up a new £30 million fund in partnership with the European Investment Fund (EIF) to invest in first-round fundings of its portfolio companies.
IP Group has put £1.4 million (US$2.6 million) into the IP Venture Fund, which had a first closing of £15.5 million and is looking for a total commitment of £30 million. It will be managed by Top Technology Ventures Ltd., the venture capital arm of London-based IP Group.
IP Venture Fund will invest around 25 percent of the total for first-round fundings of IP Group portfolio companies, alongside external investors. It also will have the option of investing alongside IP Group in seed finance rounds of companies set up as part of future IP Group university partnerships, subject to the agreement of the relevant universities.
That is a significant endorsement from the EIF of IP Group's model of signing long-term partnerships with universities that give it rights to work alongside technology transfer offices and form companies around the institutions' intellectual property.
Late last year, EIF completed a study of technology transfer across Europe on behalf of the European Commission. The resulting 450-page report, "Technology Translation Accelerators," proposed overcoming current shortcomings by putting in place agreements with major universities, along the lines of those established by IP Group and other quoted technology commercialization companies in the UK.
The report also suggested providing money and advice for the creation of new technology transfer vehicles based on Europe's leading role models.
Alan Aubrey, CEO of IP Group, said, "The EIF is one of the leading venture capital investors in Europe and has a similar view to IP Group of the investment potential and importance of successful intellectual property commercialization."
The EIF was set up to make equity investments in venture capital funds that support small, high-technology companies. It has a portfolio of more than €2.5 billion invested in 191 funds. As the VC investment arm of the European Union, it targets funds that focus on European companies, aiming to play a catalytic role by taking minority positions to pull in other investors.
Alongside the European Union, the EIF's shareholders are the European Investment Bank and a number of European banks and financial institutions, from the public or private sector.
IP Group listed on the Alternative Investment Market (AIM) in London in October 2003 and moved to the main market in June. To date, it has formed long-term technology commercialization partnerships with King's College London, and the universities of Oxford, York, Leeds, Bristol, Surrey and Southampton.
Forty-two companies have been spun out from those institutions under IP Group's aegis, of which seven have listed on AIM, and there has been one trade sale.