How do universities turn research into products and services?

Universities across the UK produce high-quality research. Over 80% of this research is considered world-leading or internationally excellent. Commercialisation is the process by which universities turn some of that research into products and services.

These products and services can be wide ranging, for example:

• new physical products, such as equipment to diagnose medical conditions
• setting up new businesses that remove carbon from industrial outputs
• partnering with universities and businesses to grow local green industries
• providing support to help small businesses survive and grow
• delivering a wide range of health and social care services to local areas
• helping the public sector, charities and other third sector organisations to increase their impact

Through commercialisation, our universities:

• produce scientific breakthroughs, such as life-saving medicines or green solutions
• contribute to our rich arts, cultural and social sectors
• collaborate with businesses and others
• attract talented researchers to the UK from all over the world

These impacts can be seen at all levels, whether it’s creating an internationally recognised product, or supporting local businesses to grow and create jobs

Commercialisation is one of the many approaches universities can take when it comes to delivering impact from research. Not all research done by universities is done with the intention of being commercialised, or appropriate for it.

A lot of research is done to push forward our understanding and to lay the groundwork for future breakthroughs. It’s important to remember that commercialised research is in no way more or less valuable than other research.

Multiple groups need to work together to make commercialisation happen, including:

• Academics and researchers: experts in their field who do the research.
• Commercial partners: businesses, public sector organisations, charities, or others that will deliver or use the end result of the research.
• Professional services: experts within universities that offer support such as legal advice, business advice, negotiating contracts, filing patents and more.
• Funders: those that provide additional financial contributions, including private investors, such as venture capitalists, and public bodies.

Each university will have different ways of commercialising their research. But there are two common ways that commercialisation happens: through either contract research, or non-contract research.

Contract research

A commercial partner will approach a university based on the strengths of the institution or their academic staff. They’ll ask that the university do research to solve a specific problem.

The university and partner will agree on some objectives, and the research will be managed under a commercial agreement.

By funding the research, the commercial partner will often have first rights to the end product.

In 2020–21, universities provided contract research worth £1.4 billion.

Non-contract research

Academics are involved in huge amounts of research, some of which may be appropriate for commercialisation, and some of which won’t be.

While doing research, academics themselves or a university’s professional services team will identify whether the research has potential for commercialisation.

The professional services team will then use their expertise to support the academic to turn their research into products, including:

• protecting the idea – for example, with trademarks or patents
• providing legal advice
• developing a proof of concept
• deciding the most appropriate end product

To ensure that it is fit for purpose, the researchers and professional services teams may evaluate and do market research to improve the product or service.

The end result is dependent on the type of product or service that is being developed.

Usually, the concept will either be licensed to an existing organisation or ‘spun out’ into a new company.

Licensing

This is the process of the university granting an organisation permission to do something with the idea – for example, allowing an organisation to use or sell the product of the research.

Licenses can be complex and have conditions, such as where a partner can use the product or service, what they can use it for, and how long for.

This means expert support is essential.

In 2020–21, universities had 24,552 active licenses for software they created and granted to external partners, and 16,695 licenses for other non-software intellectual property.

Spin-outs

Spinning out is the process of turning an idea into a brand new company based around the idea. These can be graduate or staff start-ups, be fully or partly owned by the universities themselves.

Researchers might get involved in the company, and professional services teams will usually give business advice.

In 2020–21, nearly 2,500 active university spin-outs and social enterprises employed over 40,000 people and turned over an estimated £8.5 billion.

Research is complex, expensive and commercially risky. Because of this, commercial businesses will be less likely to take on research themselves.

Universities, on the other hand, are interested in intellectual curiosity. They attract experts and have world class facilities and resources to use to develop new ideas. Most commercial partners don’t have access to these, so rely on universities to do high-risk, high-reward research.

It’s predicted that in the next five years, universities will provide £11.6 billion worth of support to businesses and charities and 21,650 new businesses and charities will be formed.

Universities need stable and sustainable government funding to support, grow, and maximise the impact of their relationships with commercial partners.

Thanks to Chris Baker, Knowledge Exchange Policy & Economic Development Manager, Sheffield Hallam University, and James Kitson, Head of Commercialisation, University of York for their expert contributions to this article.