The Prime Minister has announced the Government’s new industrial strategy to put the UK at the forefront of the global economy
Kin Capital co-founder Tom Hopkins says EIS and VCTs are perfectly positioned to help.
Theresa May stood outside Jodrell Bank and looked to the stars, and Britain’s future, and in doing so highlighted once again the UK’s position as a global leader in innovation and Research and Development (R&D).
“We are ranked first in the world for research into the defining technologies of the next decade, from genomics and synthetic biology, to robotics and satellites,” said Mrs May framed by the colossus of the University of Manchester’s space radio telescope.
“With 1 per cent of the world’s population, we are home to 12 of the top 100 universities.”
Undoubtedly, we are a collectively creative nation and the PM gave plenty of examples of famous innovators from Sir Isaac Newton to Sir Tim Berners-Lee.
But historically while no one doubts we Brits have been full of good ideas, we haven’t been very good at commercialising these ideas in the UK – rather leaving that to foreigners.
Sir Tim famously declared the World Wide Web ‘is for everyone’ – a fading British sentiment if ever there was one, especially as we head to a post Brexit world.
Mrs May highlighted some reinvention stories in parts of the country, one such was Hull, where she noted that the area had gone from whaling to wind-turbines.
What the PM didn’t mention was that Hull University invented the LCD screen. Wouldn’t it be great to say that Hull was now the centre for global LCD manufacturing? Unfortunately, the idea was commercialised and monetised in South Korea.
There are hundreds of such examples – CDs from Surrey University, defibrillators from Queens, Belfast and Fibre Optics from Imperial to name a few.
A change in attitude
Thankfully, the days of a professor publishing a paper without an attached patent are largely over and the is a recognition in the universities they should be protecting these ideas, and trying to commercialise them in the UK.
The change in attitude has been driven by government who of course want a return return on the circa £5bn of taxpayer money allocated to R&D, and the universities and professors wanting to generate value for themselves.
And this ‘professionalisation’ of Britain’s ideas factory has been supported by investors in various sectors and niches.
More to do
“Our challenge as a nation, and my determination as Prime Minister, is not just to lead the world in the 4th industrial revolution – but to ensure that every part of our country powers that success,” the PM added.
All very well, but this requires the government to invest in education, transport infrastructure, mobile and broadband connections, the right regulation and a whole lot more.
In particular, the Government wants address four grand challenges:
- Artificial Intelligence and the Big Data to transform prevention, early diagnosis and treatment of diseases
- Healthy Aging to add 5 years to life expectancy by 2035
- Clean Growth to halve the energy usage of new buildings by 2030
- Future Mobility for cars and vans to be effectively zero emission by 2040
Funding, funding, funding
To achieve its goal the government will need to provide funding and encourage investment in innovation and growth
More from Mrs May: “As a government, we have set the goal of research and development investment reaching 2.4 per cent of GDP by 2027 – more than ever before. That could translate to an additional £80 billion investment in the ideas of the future over the next decade.”
And that is why VCTs and EIS are now at the heart of the new industrial strategy.
The UK is already one of the best places to start and grow a high-tech business, and the Patient Capital Review driven rule changes to the EIS and VCT schemes are to ensure that this pot of capital was invested into growth businesses and innovation.
A £2bn pot, the amount raised under the two schemes, each year should help the UK achieve its global goals.
All can take part
“All have the chance to be part of one of the most exciting periods of discovery the world has ever known. Amongst their number will be names to be inscribed alongside the greatest figures of the past on the honour roll of scientific achievement. And together, we can continue a tradition of innovation that will extend our horizons and transform our lives,” closed Mrs May in true Churchillian style.
And by investing in the right EIS and VCT managers investors might well be able to financially benefit from UK Plc being at the forefront of the 4th industrial revolution.
A version of this appeared online in Professional Adviser