In this week’s podcast episode of the Leadership Series, we talk to Alastair Hick, senior director of Monash University’s commercialisation office Monash Innovation, about the challenges of university-industry collaboration in Australia, the opportunities around increasing efficiencies of standard TTO procedures and why virtual conferences cannot fully make up for physical meetings.
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Thierry Heles: Welcome to the Global Venturing Review Leadership Series, where we talk to thought leaders from all over the world to find out more about how they are supporting the innovation ecosystem. Today, I talk to Alastair Hick all the way down from Australia at Monash Innovation. Alastair, thank you very much for joining us today.
Alastair Hick: Thanks Thierry, great to be here.
Heles: To start with, can you give us an overview of Monash Innovation and The Generator as well, perhaps with some key figures?
Hick: I will tell you a little bit about Monash as a university first, because not everybody who is listening will be aware of Monash. We are one of Australia’s what is called the Group of Eight universities, equivalent to the Russell Group in the UK. We are a very large university, about 86,000 students, we have five major campuses in Melbourne, plus campuses in Malaysia and joint research academies in Suzhou, China and Mumbai, India and we are opening in Indonesia as well.
We are large a comprehensive university operating across multiple jurisdictions with a lot of research going on. Our research budget is around A$900m to A$1bn, around £450m to £500m a year, so a large comprehensive university.
Monash Innovation, we are the tech transfer or as they say down in Australia, the commercialisation office for Monash. We have been formally established as Monash Innovation since 2015, we have had, like many universities, various iterations of tech transfer offices and in 2015 I persuaded the university to bring things all together in a single unit that we named Monash Innovation.
Just to give you an idea, we have 14 staff at present in Monash Innovation. In an average year we will get just under 150 invention disclosures. We will do about 35 to 40 licensed deals and spin out two to five companies on average, that varies year on year.
Associated with that we also have The Generator, which I also oversee, which is an entrepreneurial program for driving a culture change in entrepreneurship, in innovation, across our staff, our students, and some of our alumni.
That is a small team of five who do an amazing job of engaging with, in an average year, about 6,000 different people across all their programmes. It is amazing and they run everything through from inspirational seminars and lectures all the way through to an accelerator programme, which they are in the middle of at the moment. They are taking 10 teams through an intensive accelerator programme and help those businesses get up.
You either attract funding if they need it or we have had teams go on to Y Combinator in the US or some of the local versions here, or attract funding from people such as IP Group, depending on what the teams are.
Heles: Amazing, that is some stunning figures you have there.
Hick: It keeps us busy.
Heles: I can imagine it would. Melbourne and Victoria have been particularly hard hit by the pandemic. As we are recording this, you are waiting for an announcement whether restrictions will be eased or not, currently you have a statewide disaster. How has this crisis impacted your work?
Hick: It has been interesting. We have been working from home since March and what we saw at the start of restrictions was that there was a little bit of a drop off in terms of disclosures and things like that. But once everybody got into the rhythm of working from home, once the researchers and the academics had sorted out lecturing online as there was a lot of time taken up on the academic side getting that up and running. Before the start of that we were on for a record year, that dropped us back a little bit but then we have been parallel tracking what we did last year and are a fraction below where we were last year. We are pleased with that and it is similar on the deal front.
The other thing that we have put a lot of effort into is that The Generator has put all their programmes online. They now can run everything virtually, which we have been wanting to do for a little while. But we had to, we had no choice. We now have teams from Malaysia going through our programmes and we will be expanding that to our other campuses going into 2021. So that has been a driver for something that we had wanted to do. Although it was a lot of work for the team it has been a great success.
Heles: I am guessing even if you have planned it, if you then suddenly have to do it in the space of a couple of weeks, it is not a fun task.
Hick: No, and the team had not even planned it for this year. It was something on the to-do list, and suddenly it went from number 10 on the to-do list to number 1, but they are looking forward to getting back onto campus because a big part of the whole building an ecosystem is that contact and that networking, and just bumping into people all the time. I think that is the thing that we miss the most, those sort of random interactions or semi-random interactions that lead to discussions that go somewhere. The routine work carries on well, but it is those extra serendipitous little interactions that we are missing at the moment.
Heles: That seems to be a problem that everyone I have spoken to has talked about – the water cooler moments or the bumping into people in corridors and they are just not happening, it is really difficult to recreate that virtually. There just is not a platform to make that happen and I am sure if there was it would suck up as much time as Slack and no one would get any work done.
Hick: It would. That and Zoom, I do not think we would have any other time left to do anything else.
Heles: Last year, you told In-Part that you have “very little choice for much of our large-scale collaboration in Australia, other than to work internationally. It is a part of how we need to do business when our local R&D is relatively limited”. Do you think that is a reality here to stay or do you see the Australian ecosystem evolving to a point where more university industry collaboration can be done domestically?
Hick: It is changing and that is something that we are really pleased to be able to say. As a university we have really committed to making change.
A couple of examples, we announced a very large partnership with Woodside, who is an Australia-based large resources company, helping them with a big energy transitions research programme, so transitioning out of fossil fuels into various types of renewables. That is a big collaboration that we announced last year.
An interesting one this year is a local biotech company that two of our researchers had set up. They came to Monash just after they had set it up, because we had said we can help you do some of that stuff and help you get on your way.
They did a really significant deal – they are in the natural killer cell area and innate immunity space. They did a massive deal with Gilead and their subsidiary Kite. Most of the research that is going on is coming back into the university, there is significant FTEs coming back into the university to do that research and that partnership. That is going to expand over the next 12 months, that partnership.
We are starting to see those sorts of things happen as well as deals we have with the likes of Johnson & Johnson through Janssen. We do do a lot with some of the resources companies here, BHP and Rio. There are real opportunities in the biomedical space because most of our biotech companies are relatively small apart from CSL. We often end up partnering those overseas, although we love to partner locally where we can.
Heles: I am guessing the pandemic has impacted those international collaborations as well, made them more difficult.
Hick: It has… I think what it interrupted is getting them going. The ones that are working have kept going. It is starting those new discussions and those new interactions, that is the difficult thing. That is the challenge. It is not the same doing virtual bio as doing bio in person.
It is not the same. Our researchers, in the Northern hemisphere summer, we do not find them in the lab, they are in the conference season in the Northern hemisphere in Europe or the US, they are talking at conferences where there are companies, where they make connections and then we help them build on those. That is not happening. There are lots of virtual conferences but it is not quite the same. We have not seen a big impact this year, but I think if things do not start to ease off into 2021, then we will start to see those collaborations harder to kick off.
Heles: Something slightly more positive. You have garnered a considerable amount of international experience. You hide it well with your Australian accent. You were the head of life sciences for Cambridge Enterprise here in the UK from 2002 to 2006. You are the chairman of the research committee for the Monash Technology Transformation Institute in Shenzhen.
You were also the chairman of Knowledge Commercialisation Australasia from 2015 to 2018. What is your impression of tech transfer internationally? Are there any approaches from one country that you think should be adopted more broadly?
Hick: It is interesting, the tech transfer community. Universities are a bit like a parallel universe. They are the same, but different wherever you go in the world. The academics are very similar, they have similar drivers and similar aspirations. They want to do great research and the ones we work with want to translate that research and they are really interested in doing that. It does not matter where you go: there is a significant subset of the academic community who really wants to get involved in that. From that perspective, you see that is the same wherever you go all around the world.
What is different is I have talked about industry a little bit, but you have got different local contexts that you are working in. It means things like we have to work harder when we are coming from Australia to do a deal, because we do not have the same contacts on the doorstep that you do have if you are in western Europe or particularly on the east or west coast of the US.
From what I have seen over the years, there are a few things that really have caught my eye. One is trying not to make things too complex. The jobs that we do are multifaceted, and we have to engage with a lot of stakeholders and line up a lot of different things to be able to get a deal across the line.
I sometimes feel we spend a little bit too much time trying to perfect things to the nth degree, rather than getting deals across the line, trying to make sure that you dot every i and cross every t. Yes, you have got to do that to an extent, but you need to know when good enough is good enough. That only comes, in my view, from experience – when you have been through that learning experience of what works, what does not work, what is important, what is not important in a particular deal.
You might have a university where they are quite risk averse, yet the chance of something going wrong and the implications of that particular risk are minimal, or that they can be dealt with, and you learn that over the years as to how to best manage that.
What I have learned is, and you will have heard this from many people, is that it is all about building relationships. That is building relationships with academics, so my team spend a lot of time talking to the researchers about what they are doing and what their objectives are and how we can help them. Then for people like myself, it is my job to build relationships across the university, to allow my team to do their job and give them the resources and the freedom to be able to do that.
Then building relationships into investor communities, into corporate communities and other thought leaders so when people think of Australia and they come, if people are interested in collaborating with Australian universities, we are usually on the list of the top couple they will speak to, and that is how we want it to be.
That takes a lot of time and effort just to keep on with the messaging and the stories about what you are doing and building relationships such that you can get your messages out there.
Heles: Of course. The next one is my favourite question. You have been listening to the podcast so I am guessing you know this one is coming.
You are the director of additive manufacturing company, Amaero Engineering until its IPO last year. It is a great success of course. What is your favorite spinout either for its technology or its financial success that has come out of Monash. Is it Amaero?
Hick: I am going to hedge my bets here and give you a couple of different answers and just illustrate why this job is both so rewarding and also, as well all know, can be quite frustrating.
Amaero has been a great success. Its IPO last year was 20 cents a share and was trading at just over 60 cents earlier today. We are pleased with how that has gone but it nearly did not end like that.
There were lots of challenges on the way of trying to establish a new company that was, for a length of its time, under-capitalised into a new industry where it was relatively easy for us to get Amaero to work with a whole lot of large corporates on the research and development side. But to translate that into manufacturing and significant sales has taken much longer than anyone ever thought and caused a lot more angst than we thought would be the case. One of the number of lessons we learnt out of that was that we had some challenges early on with some governance issues that we had to address and we sorted those out.
We did not have the right shareholders at the beginning and the university took a very proactive role to sort out the shareholder register and bought out a couple of shareholders to do that. And that enabled the company to sort everything out for it to be able to list with the help of another investor partner late last year.
The commitment of the university from the highest level – and I mean from the highest level – was essential for that success. It is one of those classic stories of perseverance, a lot of hard work and a lot of learnings in terms of how to successfully run an early-stage company that was both at the research end, but also it was selling things and that is unusual for lots of companies coming straight out of a university. It had both the research and development side but it was also selling things to companies and that also caused some challenges.
I will briefly mention two others.
The first one is Monash IVF, which was a company that actually almost completely predates my time at Monash. So just after I arrived at Monash, we sold the company for about A$200m of which the university took half. The other half went to the founder clinicians who were heavily involved in the company. Many of your listeners will not know, but Monash did a huge amount of work pioneering early IVF work.
Fifteen of the world’s first 20 babies born by IVF were Monash babies. Monash established working with our clinician research, that was based on 10-plus years of research. Then the company took 10 years to get up and running, at which point it was profitable and we sold it, but it established that this was something that could be done in Australia at Monash and that matters because it sets a precedent to say this is possible. We can do this, and we can be successful.
Of course, the wonderful results that has had for thousands of families across Australia and more broadly, is also a massive, obviously wonderful benefit. It showed what we could do, and I think that has always been something that is important when you start to see those examples, you start to believe them.
The last one I am going to mention is a company we do not actually have any equity in, we have a licence deal with. It is company called 4D Medical, originally called 4DX, that started up at the university about seven or eight years ago. A researcher and two of his PhD students developed some technology for basically lung function imaging, so you can do in it real time and measure real lung function.
What is interesting about that is that we were not in agreement with the founders as to valuation and how it should go forward. Rather than us saying we are going to be a big, bad university and insist you do what we want, we said to them you can go ahead form the company. We will do a licence deal on simple, standard and reasonably easy terms.
We allowed them access to various bits of kit, they had to pay for it, but it was all agreed and set up well. The principal investigator was given a 12-month sabbatical to work on the company and at that point make a call as to what you want to do. Although it is not a traditional university spinout we put in place all the bits to allow them to be successful.
That company floated earlier this year, raised A$55m on the ASX and is valued at north of A$500m. And that is down to a huge amount of work from the team. What I like about it is that in some institutions we would have stopped them doing it, and we did the opposite, we actually enabled it to happen. They have done all the work, but we were there to help them and to give them support along the way and that is an important thing to say.
All those companies are very different in the level of involvement from the university, and that is something I have been driving at the university, there is no one right way to do these things. What we try and do with everything is have options. Options of support, options of routes to commercialisation, options to start up or spin out companies. The university can be involved or not involved and that is proving to be really successful for us.
It is giving us each opportunity and the team associated with it is unique and we help navigate them through all those options that we set up, whether it is our partnership with IP Group, whether it is a partnership with another venture fund, whether it is going through our Generator programme, whatever it might be. Whether it is proof-of-concept funding that we have got access to, we have got lots of different ways to help and find the best approach for this particular opportunity.
Heles: You have mentioned IP Group. You were also founding director of the A$30mTrans-Tasman Commercialisation Fund all the way back to 2008 when a university venturing fund was mostly unheard of, although you had of course already got Uniseed in Australia. Is there enough capital for Monash and the country more generally today? Could there be more? There could always be more money, but are you fine with what it is looking like at the moment?
Hick: The short answer is we can always do with more. The longer answer is a bit more complicated.
When we set up the Trans-Tasman fund with a couple of other universities in South Australia and in Auckland in New Zealand, we had A$30m to spend across five universities and it did not go very far. In fact, we did not even spend all that, the global financial crisis hit and there were some challenges from the LPs in terms of asset allocation. Although it did make a positive return, it struggled.
What is interesting is we are now in the situation where there are deals going on in Australia where people are raising a series A that could be A$10m to A$20m, which was unheard of. So in that respect, there is enough money for the right opportunities.
However, there is a couple of areas that are still lacking and those would be, one, at the proof-of-concept early stage, couple of hundred thousand dollars to get something up and running and just see if it can be successful. The sort of thing that Parkwalk might do in the UK, or something like that, at least to start off with – what the university challenge funds used to do in the UK way back in the day.
There are opportunities there and I expect to see that those will be addressed in some way. We are certainly interested in how we can fill that gap, whether we work with an alumni-based fund or something like that to do something in that space. I would be very surprised if in 12 or 18 months’ time, we have not got something up and running in that space because we see that there are some great opportunities. We have huge numbers of people who want to do things. We have got great technology. We just need to give them a little bit of help. That is one space and I think that will get filled going forward.
The other space is in the non-life science area. In life sciences and biotech we have had a long established biotech community, we have had a number of funds, some of whom have done very well. We can generally find funds in that space, but in some of the engineering and physical sciences materials areas we do struggle a little bit.
It is not just about the money, it is also about the expertise. Yes, we work with IP Group and we have had three investments with them in the past 18 months, and that is great, but we have plenty more of opportunities that we would be looking to partner and to find investors for. I think those are the two spaces that we believe more could be done in.
Australia has got a very large superannuation industry. There is enough money around, there is no doubt about that. The next couple of years is about demonstrating track record and then the capital will flow into those as though the opportunities that we have been working on in the last couple of years go through. If they are successful, then the capital will flow from that. We are not worried about that; it is the routes to that capital that there is still a little bit of work to be done.
Heles: My final question, open-ended one: is there anything we have not covered that you want our listeners to know about?
Hick: I will just come back to what I was talking about with options. On the one hand we try and give all our individual technologies and opportunities as many options as we can. The challenge with that is that if you are bespoke for everything, you spend a lot of time working on each individual opportunity, each deal, and that is just not sustainable.
We do not have enough people to do that, and yes, my team work incredibly hard. What I am interested in is the 80:20 rule, because probably 80% of the things that we do fit some fairly standard criteria. How do we make those way more efficient than they currently are? How do we get things through the system much, much faster? That is a challenge for all of us.
I do not mean twice as fast, I mean 10 times as fast really, because we are wasting time and we are wasting opportunity. The amount of time we sometimes spend on negotiating inter-institutional joint invention agreements, and other things like that, they slow everything down, internal processes that slow things down, what can we do about that?
There is a lot of things we can do there and then focus on the value-add. We are all being asked to do more with less resource, and the only way we can do that is to be way more efficient than we currently are, and some of the work that we do is inherently highly resource or people resource-intensive.
The only way we can do that is to work out what are the areas where we can make things as easy and simple as possible. How can we make those processes for our researchers, for our investor partners, for our corporate partners, as simple and easy as possible so that we can make routine business routine.
Heles: Big challenges still ahead there.
Hick: I think it is all doable though. The reality is that if you want to, you can do it. If your institution believes that you can do it, then you have got the ability to do that. We have seen huge change in the industry in the past 20 years that I have been involved. We have gone from a whole series of one-off transactions that we used to do, to building much more complex relationships and partnerships, both with corporate partners and investors.
I think the complexity and sophistication of what we do is amazing these days across the whole industry. We now need to work out: where are the bits that we can simplify? What are the things that we can just make happen rather than having to jump through six different hoops?
Heles: Amazing. Those are some good closing words, finishing on a positive note, I always like that. Alastair, thank you so much for taking time out of your day, it is probably dinner time for you now and I shall let you get on with your day. Thank you very much for being here.
Hick: Thank you.