Ann Casey on co-investing in success
A collaboration between Finance Wales and Fusion IP, the
company which commercialises university-generated intellectual
property or IP, has already seen Finance Wales invest £3.8 million
in seven spinouts.
Ann Casey of Finance Wales reflects on the benefits the
relationship is delivering for the spinouts the companies are
“When we signed the memorandum of understanding with Fusion IP
back in 2007, Cardiff University had been identified as one of the
UK universities most likely to generate commercially viable
IP and Fusion IP had signed an exclusive agreement for the
rights to Cardiff’s IP,” Casey explains. “We were excited by the
pipeline of potential investment opportunities a strong
relationship could bring.”
Spreading the risk
Now, seven co-investments later, Finance Wales and Fusion
IP have invested in hi-tech spinouts commercialising a diverse
range of IP. The companies have also developed a strong
relationship along the way and Casey believes this relationship
offers real benefits for investor and investee-company alike.
Finance Wales and Fusion IP obviously benefit from working together - we can spread the risk, share diligence costs, for instance. But the spinouts also benefit. Co-investment increases the availability of investment capital and in a number of deals, our involvement has also attracted other co-investors with additional funding or sector specialisms, including ERA, Disruptive Capital Finance and Longbow.
Ann CaseyFinance Wales' Early stage investments executive
The backing of strong investors also helps spinouts as they
commercialise their ideas and bring them to market because they
often require follow-on investment. Both Finance Wales and Fusion
IP are able to follow their investments to ensure that spinouts
achieve their potential.
In any potential investment, valuable IP is important, but so
too is a realistic exit strategy and a strong management team with
a commercial focus.
As Casey explains: “Spinouts need to develop a commercial focus
from the outset as this can mean the difference between success and
failure. Fusion IP will often second staff to a pre-revenue
academic spinout in the early days to help its management team
develop its commercial focus and plan for exit.”
Now, as the relationship between Finance Wales and Fusion IP
enters its fifth year, Casey is pleased with the investment
opportunities that have resulted from the tie-up as well as the
other benefits it has brought for the two investors and the
spinouts they have invested in.
“Not only have we invested £3.8 million since signing the
memorandum of understanding, but we’ve developed a strong
relationship which has benefited the spinouts we’ve co-invested in.
Co-investment can pay real dividends and I’m convinced that we’ll
be able to achieve even more in future,” continued Casey.
This article first appeared in Spinout UK's Quarterly Journal