Investing in spin-outs? Get a second opinion

As an investor, how do you know whether the science forming the basis of a new business is as good as the business plan asserts? Depending on the size of your proposed investment, you may just go with a hunch or ’phone a friend, or you might decide to get an independent second opinion. Oxford University Consulting (OUC), part of Isis Innovation, is offering a new service to investors to provide an impartial evaluation: a tailored assessment of the company’s science, undertaken by a world-class academic expert in the field.

OUC has been offering a consulting service to companies for over five years and the take-up by investors for technical due diligence before investment has gradually increased over that time. Dr. Elen Wade-Martins, one of the OUC Project Managers, commented: ‘The investors we work with really appreciate the independent nature of the technology appraisal that we offer and the fact that it’s done by a consultant who’s working at the cutting-edge of that technology themselves. We’ve also found that they like the flexible service we offer – each case is slightly different, so we fit the due diligence to what’s needed.’

Dr. David Holbrook, a Partner at MTI Partners, has recently used the service to inform a key investment decision: ‘OUC found a consultant with just the right expertise, who produced a high quality report on the company’s technology. It really helped to inform our investment decision and we are now using it to bring other investors on board. We believe that doing due diligence on the science and technology is just as important as the due diligence on the finances and IP’.

OUC has access to academic experts across the full spectrum of the University’s departments. So far, popular areas for investment due diligence consultancy include nanotechnology, drug discovery and medical devices. Many new businesses are based on interdisciplinary science, so OUC can also put together a team of more than one expert to evaluate the technical proposition.

A due diligence assessment starts with a call to OUC, where a project manager will discuss your requirements, source the right consultant and manage the project right through to delivery of the assessment report.