A stunning three-month run for spinouts shows large sums flowing in and out of the innovation ecosystem.

There have been five investment rounds in university spinouts worth more than $500m in the past 18 months – three of these occurred this year and two of them in the first quarter. It partially explains the $8.73bn raised in January, February and March – significantly more than the $7.23bn raised over the last five months of 2020. Databricks, a US-based data analytics software producer based on research at University of California, Berkeley, accounted for a whopping $1bn of the 2021 total thus far. The company’s series G round in early February pushed its valuation from an already respectable $6.2bn to $28bn and the cash came from investors including corporate venture capital units Amazon Web Services, CapitalG and Salesforce Ventures – on behalf of internet and e-commerce group Amazon, technology conglomerate Alphabet and cloud computing firm Salesforce – as well as software producer Microsoft. Despite Databricks’ large round, the top 10 deals accounted only for $3.1bn of all funding, proving that there was a lot of money invested in others too. Sila Nanotechnologies, a US-based battery materials producer, is a similarly interesting beast. Co-founded by Georgia Institute of Technology faculty and former engineers of electric carmaker Tesla, the company secured $590m in a series F round at a $3.3bn post-money valuation in late January. The line-up of backers consisted of institutional investors led by Coatue Management, but Sila’s cap table already included advanced battery producer Amperex and Next47, a corporate venturing subsidiary of industrial equipment and appliance maker Siemens, carmaker Daimler and, intriguingly, In-Q-Tel, the venture firm investing on behalf of the US intelligence community. Hinge Health, a US-based digital therapeutics company, does not have a direct university link but its co-founders – chief executive Daniel Perez and president Gabriel Mecklenburg – obtained a PhD in medical sciences from University of Oxford and MPhil in bioengineering from Imperial College London respectively, and that strong academic background was reason enough for commercialisation firm IP Group to throw its weight behind the business. It did not feature, however, in Hinge Health’s $300m series D round co-led by Coatue and Tiger Global in early January. Notably, Perez previously founded and became chief executive of Oxbridge Biotech Roundtable, an organisation looking to connect academia with industry, during his PhD research in 2011, with Mecklenburg joining later that same year as chief operating officer. For their impressive sizes, these three companies only represent the tip of a very large iceberg in the first quarter, which…

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Thierry Heles

Thierry Heles is the editor of Global University Venturing, host of the Beyond the Breakthrough interview podcast and responsible for the monthly GUV Gazette (sign up here for free).