According to Reuters, which publishes the ranking of the most innovative universities, the educational institution from Belgium owes that first spot to “producing a large number of influential inventions.” In their latest world rankings, KU Leuven ranks seventh, the first non-U.S. institution on the list. Stanford University, MIT, and Harvard occupy the top three.
The university produced 151 spin-offs over the past five decades. Well-known examples are forerunners in 3D printing Materialise, vaccine platform AstriVax, and chip inspection specialist ICOS Vision Systems (which has since been acquired by multinational KLA). In 2022, licensing revenues earned KU Leuven 150 million euros; that’s 20 million more than in 2021. No Dutch university manages to come close to that.
- KU Leuven has generated €150 million in licensing revenue by 2022;
- No Dutch university comes close to this;
- The Gemma Frisius Fund, KU Leuven’s own seed capital fund, provides financial support to spin-offs in their earliest stages;
- Investment manager Bart Geers emphasizes the importance of ‘co-entering’ and setting up structures that allow professors to participate transparently in spin-offs.
Relevant research
What explains this success? “There is no single answer to that question,” says Bart Geers. As an investment manager, he guides spin-offs from cradle to exit. “The fact that back in the 1970s there were already professors at KU Leuven who recognized the value of collaborating with industry – certainly not a given at the time – has certainly contributed.”
For example, intensive research into vaccine technology is being conducted at KU Leuven’s Rega Institute – one of the university’s most innovative institutes. Belgium is an international hub for the export of (bio)pharmaceutical products. During the COVID-19 pandemic, research and manufacturing facilities were pivotal in developing and producing large-scale vaccines.
A seed money record of 30 million
Astrivax, a spin-off from the Rega Institute, broke the “seed money record” for KU Leuven spin-offs in the summer of 2022 with a record investment of thirty million euros to build a vaccine platform. The company is developing new vaccines that are easy to produce, have fewer cold-chain requirements, and offer broad, long-term protection against viruses.
Hanne Callewaert is CEO and co-founder there. “KU Leuven’s technology transfer service was important in our early stages. Especially when it came to opening doors to potential investors and guiding us through the whole process of starting a company. The university owned our technology then, and of course there were discussions. Still, in the end, everyone has the same goal: to establish a successful company and valorize technology so that it can be at the service of society.”
Seed Capital Fund
One of the things KU Leuven does differently is that it has its seed capital fund, the Gemma Frisius Fund. The fund is jointly managed by the university and the two largest banks in Belgium.
Geers: “We can use equity from that fund for spin-off companies, even if they are still in the earliest stages. The fund is not limited to one technology domain but looks at all spin-offs involving KU Leuven technology. In the Netherlands, you also have investment funds, such as LifeSciences or Forbion, specifically linked to a university and making thematic investments. But with their incentives. We do it on behalf of the university and its professors. Our fund serves the university.”
A head start
In 1972, KU Leuven established a technology transfer service to bridge the gap between academic research and society. This service allowed professors to focus on their research as its staff interacted with industry and other stakeholders. “That gave our university a 20-year head start on others who didn’t set up their own offices until the late 1980s or early 1990s. So we were able to develop a way of working earlier and build a strong reputation,” Geers says.
That said, they also find in Leuven that starting a company is a difficult period. “We cannot ignore that we are coming out of a crisis. Macroeconomic conditions, such as rising interest rates, make raising financing more difficult. But, it did show that even in those difficult circumstances, we can still be successful.”
The most important advice Geers would like to give other universities to help spin-offs succeed is: co-ownership. He sees the establishment of a spin-off as a matter of forging ties with many people and as a long-term process. “What can help is to set up structures that allow professors to participate transparently. Raising funding is a challenge in deep tech, biotech, and health tech, and the processes take a long time. By co-investing ourselves and staying involved even after the company is founded, we gain confidence with investors.”
The right people in the right place
Davide Iannuzi, Chief Growth Officer at VU, said in an earlier article in this series that the biggest challenge is finding the right people to set up and manage a company operationally. Geers concurs.
“Someone who comes up with genius ideas in the scientific field is only sometimes the right person to commercialize such an idea and run a company. You always have to use talent where it is best. For example, a CEO has a completely different role than a CTO. That’s something you must be aware of and consider.”
Callewaert also emphasizes that it is essential that spin-offs make good agreements right at the beginning about the role of the academic and operational founder. Because, in her experience, it is mainly about the complementarity of academics and entrepreneurs, an academic often has other goals than building a spin-off. “Our academic founders are closely involved through collaborations and as scientific advisors but do not interfere with day-to-day operations and strategy. We call on their scientific expertise. That construction works very well.”
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