How to turn a PhD project into a commercial venture
Transforming a doctoral research project into a commercially viable product requires astute decision-making from the start. Manjinder Kainth and Nicola Wilkin share a beginner’s guide
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Software that can ease the burden of marking students’ work might seem something of a holy grail for busy academics. Through a PhD research project, we developed a tool, Graide, that employs artificial intelligence and clever programming to significantly reduce this workload. Our team has since raised £800k to commercialise the platform, which is being piloted across six UK universities.
However, it is unusual for a student project to pursue a commercial route, particularly one in the field of theoretical physics, and the journey from PhD research to a fully-fledged, marketable product has not been straightforward. Here are some of the things we learned.
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Seek support from university commercialisation experts
All institutions will have a research commercialisation office or technology transfer team. It’s best to talk to this team as early as possible to get their advice on whether the research has market potential and, if so, how best to take it forward. This team will also have a view on whether you can protect any intellectual property (IP). This must be done as early as possible – and definitely before the invention or innovation is revealed in any research publication.
Each university’s commercialisation support is different, but broadly speaking there are two routes for commercialising research: spinning out a company that you help run or licensing your research.
Licensing or spin out?
The commercialisation team at University of Birmingham Enterprise guided our decision on whether our software should be licensed to a developer, or whether we should do this ourselves via a spin-out company.
Licensing has several benefits, including lower risk, a clear separation between the creator of the IP and the company commercialising it, and no ongoing costs for the research team or university. On the downside, it can take a long time to find a licensee and, once IP has been licensed, its success or failure is out of your hands.
In contrast, a spin-out can require ongoing commitment from the academic team, and it may take a long time to make any profit. However, we decided to go down this route, so we could get up and running rapidly and keep the enterprise in our hands.
Research the market
Getting a thorough understanding of the market you want to enter is critical to business success, as is knowing exactly what problem you are solving for your potential customers.
There are many books and articles on this topic. We used the Business Model Canvas, which forces you to crystallise your thinking about product benefits and the best route to market. It is an iterative process and we found it helpful in revealing the areas where we needed stronger evidence, that our business proposition had value and the potential to succeed.
We already knew anecdotally that assessment marking puts a huge strain on academic workloads – but that’s quite different from finding factual evidence and data that can be used to write a business plan. Similarly, evidencing your value proposition is just as important. Fortunately, this is a skill developed by being a researcher. We carried out a comparative marking study on the same data set with and without AI assistance to calculate Graide’s 89 per cent reduction in grading times.
We also needed to find out the potential size of the market, forecast sales and revenue and the potential for development and growth, and get to grips with the business landscape in terms of competition and barriers to entry.
This is a skill many researchers are already trained in: quantifying and identifying the size and shape of a problem. I recommend determining what type of customer you will have, researching how many people fit that customer profile, narrowing it down to how many you can realistically target (don’t just use an arbitrary percentage, think about your network and strategies for reaching out to them), and multiplying it by the price of your product.
Get funding support
Launching a company requires resources, and many academic spin-outs get support from venture capitalists or business angels, who offer funding in return for a stake in the company and may also offer business support and advice as part of the package.
Your commercialisation office should be able to support you with both introductions to investors, and negotiating terms with them.
Some universities take shares in spin-out companies, and this is another source of funding that is worth exploring. In return, they may ask for a royalty or revenue-sharing agreement.
Make sure you enjoy it!
Spinning out a company is a big commitment and it’s not a route that is suitable for everyone. But if you have the passion for the commercial side, it’s hugely rewarding, and you get to “own” the success of the resulting enterprise.
Manjinder Kainth is CEO of Graide. He co-developed Graide with George Bartlett off the back of a PhD thesis written by Robert Stanyon. The trio recognised the need for such a system while working as teaching assistants during their postgraduate studies at the University of Birmingham.
Nicola Wilkin is director of education for the College of Engineering and Physical Sciences and professor in the School of Physics and Astronomy at the University of Birmingham. She supervised the PhD research that resulted in Graide’s development.
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