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Key Findings

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Investors

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Purpose

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Policy

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Appendix

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Research & Technology Hubs

Europe enjoys a broad technical talent base composed of professionals with a scientific or technical training background. The UK and Germany are the region's powerhouses, followed by France, Spain and Poland.

Number of scientists and engineers by country

Note:
'Scientists' and 'engineers' refer to people who are engaged in professional work on science and technology. Data is sourced from Eurostat and gathered by CERN. Latest data is 2018.

On a population-adjusted basis, the Nordic region is home to countries with the densest research and developer talent bases. Finland, in particular, has been able to capitalise on a dense technical talent base to support a proportionately higher number of deep tech deals given its population size. In this graph, the size of the bubbles indicate the number of deep tech deals.

Density of researchers and professional developers by country versus deep tech deals per million people

Note:
Only countries with 10,000+ developers and 10+ deep tech rounds included. Funding data from Dealroom, developer data from Stack Overflow. Research data from Eurostat, gathered by CERN. Numbers adjusted per capita for clarity.

A profound and exciting wind of change is blowing through Europe.

European Universities are simply among the very best in the world for research and IP contributions, especially in deep tech. Yet, until a few years ago, they were also quite modest in their commercial aspirations, certainly compared to the US. But a profound and exciting wind of change is blowing through Europe. A new generation of European entrepreneurs and academics are setting their sights at building world class global companies. Many are not willing to expat to the US to find success anymore. And they can count on a growing support ecosystem that is taking root here, e.g. the launch of CDL in the UK in 2019 (and in Paris next year), or new funds such as OSI (Oxford) and CIC (Cambridge) willing to support founders with the patient capital necessary for deep tech startups. And the world has taken notice, with many of the large North American and Asian funds now turning their attention to Europe, opening offices and/or announcing growth funds specific to Europe. Very exciting.

Patrick Pichette

Inovia Capital

General Partner

The large research community in Europe continues to be a prolific source of ideas and a knowledge factory globally, on par with the US.

Number of publications in Europe, China and the US

Legend

  • 2018
  • 2017
Note:
'Count' refers to a fractional count that takes into account the percentage of authors from that institution/country and the number of affiliated institutions per paper. Data sourced via Nature Index and gathered by CERN.

Europe doesn't only stand out by the size of its talent pool; the quality of the research originating from Europe is world-class, with 4 of the top 10 global research institutions based in Germany, France and the United Kingdom.

Top 10 global research institutions by contributors to research papers, 2019

Source:
Note:
'Count' refers to a fractional count that takes into account the percentage of authors from that institution/country and the number of affiliated institutions per paper. Data sourced via Nature Index and gathered by CERN.

Historically, US research has often been more application-driven than European research, which could be a clue to understanding the US' success in commercialising research. I think the bridges between different communities are stronger in the US, especially between investors and the startup community. However, the European tech ecosystem has a lot to offer for deep tech. For example, Europe publishes more research papers related to artificial intelligence than either China or the US. At CERN, we are looking for investors interested in our AI solutions, so we invite them to look for opportunities on this side of the pond.

Giovanni Anelli

CERN

Head of Knowledge Transfer Group

On the global scene, China continues to grow its research capabilities at an impressive rate and, while the number of patents for both Europe and the US is mostly stagnant year on year, their share is in decline.

Share of patents (%) filed by region of origin over the years

Legend

  • China
  • Europe
  • United States
  • Rest of world

But Europe is particularly well positioned to win in a number of technology fields, often tied to the strength of traditional industries and the presence of large incumbents in certain regions. For example, Europe is in the lead for both the mobility and robotics space. Meanwhile, Europe is still lagging behind in software & computer technology.

Share of patents (%) per technology field per region, 2014-2018

Legend

  • Europe
  • China
  • United States
  • Rest of world

Europe is trying to catch up though, with the "IT methods for management" category being one of the fastest-growing patent technology fields in Europe. This is the category that is the closest approximation to 'software', according to the definitions used by the World Intellectual Property Organisation.

Fastest-growing patent technology fields in Europe, 2009-2013 vs 2014-2018

Note:
WIPO statistics database. Data last updated October 2019.

The growth of Europe's most dynamic tech hubs - London, Berlin, Amsterdam, Stockholm, Helsinki, Dublin and others - along with the accompanying inflow of investment, is driving a steady reorientation of talent, not only from Europe but from countries outside of Europe - including my native Israel - to help meet demand. Our business, which requires highly trained individuals in plant biology and plant science, also benefits from the pool of master’s and Ph.D candidates so plentiful in European markets.

Osnat Michaeli

Infarm

Co-Founder

Mobility has been consistently in the lead in Europe over the past 5 years as well as Health/Pharmaceuticals.

Number of patents per technology field per year, 2014-2018

Legend

Note:
WIPO statistics database. Data last updated in October 2019.

It should not come as a surprise that Germany leads by a long way on the number of patents in Europe and is home to a strong and dynamic base of traditional transport/mobility corporations.

Cumulative number of patents filed by country of origin (thousands)

Note:
Cumulative number of patents between 2008 and 2018.

Europe is consistently recognised as one of the most promising sources of talent in computer science globally. Indeed, Europe is home to 25% of the Top 50 universities in the world for computer science, including 4 of the top 10 and the overall number one institution, the University of Oxford.

Computer science


25%
of the top 50 universities in the world for computer science are based in Europe.

European universities among global top 50 in computer science and their global rank

Note:
'Rank' refers to position in global list of top 50 institutions for computer science qualifications. Compiled by the Times Higher Education Supplement and includes 749 universities across the world.

Yet, despite Europe's long-standing strengths in research, the majority of the European tech community does not agree that European universities are effectively commercialising intellectual property developed by academic research. Most notably, academics, researchers and policymakers were most likely to disagree that European universities are effective.

Do you agree or disagree with the following statement? European universities effectively commercialise intellectual property (knowledge, technology, etc.) developed by academic research

Source:

Legend

  • Agree
  • Disagree
  • Neither agree nor disagree
Note:
Numbers may not add to 100 due to rounding.

When asked directly how to better support the research community to start companies and help them succeed, respondents who are academics/researchers pointed to changing the terms of research funding away from publication and towards commercialisation, as well as educating universities to change their mindset towards being able to encourage and better support spinoffs.

If you were to pick one action from the list below that would better support the academic/research community to start companies and help them succeed, what would it be?

Source:
Note:
Academics/researchers only. Numbers may not add to 100 due to rounding.

Although there is likely a sample bias in the responses to the survey, it's noteworthy that three-quarters of respondents who work in academia or research shared that they have seen an increase in the level of interest of people in their networks in starting or joining tech startups.

Thinking about your academic or research network (i.e. other academics, researchers, students, etc.), have you observed any change in the level of interest in starting or joining tech startups in the last 12 months?

Source:
Note:
Academics/researchers only. Numbers may not add to 100 due to rounding.

I believe the academic and business sectors are currently fragmented and stuck in tunnel vision. We need to align both sectors to drive the development of our technology in the right direction and achieve global scale for our tech.

I believe the academic and business sectors are currently fragmented and stuck in tunnel vision. We need to align both sectors to drive the development of our technology in the right direction and achieve global scale for our tech. Academia needs the freedom to do research; however, it needs to align training, researcher upskilling, and the ideas of innovation towards meeting future goals that are aligned with big competitive ambitions for Europe. Ideas that come out of academia need to be feasible for implementation in an industry setting, therefore we need to see each other as partners not as rivals. In many instances academia sees business as funders or as processors, not as partners to reshape the world. Simultaneously, businesses see academia as long-term vision R&D partners, and business goals are not aligned with academic collaboration. I believe the two should create a real partnership, through an agile work mindset with clear short- and long-term goals.

Loubna Bouarfa

OKRA Technologies

Founder & CEO

Though the interest levels in starting or joining startups is increasing, there remain barriers to this happening. When asked about the main reservations they have, lack of funding was given as the most frequently cited reservation by academics and researchers when considering whether to start or join a startup. Risk appetite and fear of failure also appear to be a continuing factor given the strength of consideration regarding future career/reconversion prospects.

What are the main reservations you would have when considering whether to start or join a startup?

Source:
Note:
Academics/researchers only. Numbers do not add to 100 as respondents could select multiples choices.

Given those concerns, it shouldn't be surprising that students themselves cite increased access to startup support organisations or programs as the number one action that could better support them. These offer the promise for students to access groups to share knowledge, experiences and connections in a way that can have a meaningful impact at the beginning of the startup journey.

If you were to pick one action from the list below that would better support students to start companies and help them succeed, what would it be?

Source:
Note:
Studens only. Numbers may not add to 100 due to rounding.

Hubs that combine mature ecosystems to provide initial support as well as world-class laboratory and research space are best equipped to produce high quality companies. In that respect Oxford, Cambridge, London, Paris and Berlin still lead the pack…There, talent investors like EF, programs like the Creative Destruction Lab in Oxford (and soon in Paris), or dedicated funds like OSI or the PSL Innovation Fund, continue to grow the top of the funnel. That said, some research ecosystems are very strong on specific themes and remain completely under the radar – Cork University in the microbiome, EPFL and ETH in construction, Montpellier in ecology, the University of Wageningen in Food Science & Technology or the University of Delft in biotech are examples that stand out.

Alex Terrien

Future Positive Capital

Co-Founder

Countries where universities help students materialise their entrepreneurial calling are also likely to benefit in the long term as we see a high proportion of founders starting their companies in the countries where they studied.

Share of founders (%) who founded their companies in the countries they studied

Legend

  • Stayed in country
  • UK
  • Germany
  • France
  • Switzerland
  • Rest of Europe

Looking beyond the faculty to the students themselves, it is interesting to explore their core reservations about starting or joining a startup. For students, a lack of confidence in how to get started is the most frequently cited reservation. This is followed by concerns about funding, having the right skillset and also obtaining the necessary knowledge on how to get going.

What are the main reservations you would have when considering whether to start or join a startup?

Source:
Note:
Students only. Numbers do not add to 100 as respondents could select multiples choices.

There is now positive momentum in the level of deals and capital invested into spinoffs from European universities.

Number of deals and capital invested in Europe-based university spinoffs

Source:

Legend

  • # of deals
  • Capital invested ($M)
Note:
2019 annualised based on data to September 2019.

Although Germany and Switzerland are respectively leading on the overall number of patents and the number of patents per capita, universities in the United Kingdom accounted for the largest share of European university spinoff activity.

Number of deals in Europe-based university spinoffs by country

Source:

Legend

  • UK
  • Germany
  • Switzerland
  • France
  • Ireland
  • Belgium
  • Netherlands
  • Rest of Europe
Note:
Based on data from September 2018 to September 2019.

Looking across Europe at the volume of capital raised by spinoffs from top European universities over the past 12 months, it's clear that it is a very mixed bag. There are positive signs from the United Kingdom and Switzerland, but beyond those places the level of spinoff activity from universities from elsewhere in Europe is limited.

Top European universities by total capital raised ($M) by spinoffs

Source:
Note:
Based on data from September 2018 to September 2019.

The days of the ivory tower are rapidly receding as European universities and the tech industry learn to dance together.

European universities and the tech industry are cooperating more and more. 'Deep tech' is not just a cool label, it is a viable investment model with its own logic: identify game-changing technologies, assemble diverse teams, build viable business models, and have lots of patience! This kind of entrepreneurship happens not only at the technical universities, such as Aalto University or TU Munich, but also at the traditional research universities in Paris or London. At Oxford, we are spinning off more than two new tech ventures every month, and we also have countless student-led startups, supported by university programmes such as at the Oxford Foundry. The boundaries between universities and the commercial world are increasingly blurred. Oxford Science Innovation is a private venture firm, yet it is entirely focused on the university’s spinoffs. And at the Creative Destruction Lab (CDL-Oxford), we are bringing together business mentors, scientists and students, all with a common goal of accelerating exceptional AI ventures that come from anywhere in the UK and beyond. The appetite for joint academic-industry initiatives is enormous, especially among young students and tech executives. Academics and policy makers are waking up to the opportunities too. There is still a lot to do, including reforming IP and tech transfer policies, rethinking incentives in academia, and even reimagining the role of universities within their local ecosystems. Yet the days of the ivory tower are rapidly receding as European universities and the tech industry learn to dance together.

Thomas Hellmann

Saïd Business School, University of Oxford

DP World Professor of Entrepreneurship and Innovation

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