Email
Graham Richards never had a grand plan to make money from his research. It just happened. "I'm a great believer in the cock-up theory of history," he says when we meet to discuss his new book about university spin-outs. For example, he says, his birth on 1 October 1939 meant that he missed having to do military service by one day. "Had I done military service, I may not have ended up doing a PhD," the recently retired head of chemistry at Oxford University explains. He might also not have been one of Oxford's first chemistry graduates to use a computer.
In either case, he would not have founded Oxford Molecular, a scientific software company that at its peak was worth £450m, or helped set up Isis Innovation, Oxford's technology transfer company that has brought around 60 spin-out companies into existence, generating tens of millions of pounds of income for the university.
His new book, Spin-Outs: Creating Businesses from University Intellectual Property, is not, strictly speaking, a "how to", but an account of his own successes and failures that he hopes will encourage others to have a go. "I try to show that you can do this without prostituting yourself, without giving up on academic values - and that it can be a lot of fun," he says.
Noble values and good fun are honourable aims, but what of the financial perks? The world of business holds more money than your average researcher would dream of making. Richards would know. In 2006, a Times Higher Education Supplement survey reckoned him to be one of 12 UK academic "super-earners", and in his department, at least five people have become millionaires.
"I guess I've made a couple of million, one way or the other," says Richards, with a very British mix of pride and self-deprecation. "But some of the shares I own are not looking so rosy at the moment." It is clear that Richards doesn't want people to see his financial success as a driver of his ambition. But to dismiss it is to sell short the qualities that helped him succeed, not least his ability to work through adversity - including personal tragedy.
"I suspect I could well be the last British-born student who went to Oxford with a mother who didn't even have a secondary school education," he says. His mother, one of 14 siblings, was raised in deepest rural Wales, and was sent, along with her sisters, to England as a domestic servant. She ended up in Birkenhead, where she met Richards's father, also of Welsh extraction and from a similar background.
Natural choice
Richards says: "It was a very Welsh thing at the time that education was the way of improving your life." Three of his older cousins became academics. Richards did well at school, and when he arrived at Oxford as an undergraduate, research was a natural career choice.
He got his PhD in 1964, a year when academic jobs were easy to come by. "New universities were being created and existing ones were doubling in size," he recalls. "I didn't even apply for the job; there wasn't even an interview. I was given a lectureship at Oxford, aged 24."
At the time he cared little for the earning potential of his research field. He was doing basic science, using computers to calculate rather esoteric properties of compounds. Nobody thought it had commercial potential, least of all Richards. Moreover, the computer he used was a rumbling behemoth the size of a large classroom and less powerful than a modern watch. Nobody could foresee its role in the future.
Richards spent 10 years at the coalface of computational chemistry before the pharmaceutical industry started taking an interest in his work. "I produced, immodestly, the world's first colour graphic pictures of molecular structures," he says. It was a neat alternative to the sticks and balls chemists normally used for modelling compounds. But the technology had other applications. For example, it allowed scientists to compute properties of compounds without manufacturing them first - something that could save money for the drug industry.
Soon the commercial potential was staring him in the face. Hi-tech businesses were thriving in California; he had seen them during visits to Stanford University in the late 70s and early 80s. But having an idea for a company was the easy part. To set it up, he'd need someone with a mind for business. Richards had found such a mind in Tony Marchington, one of his research students. They came close to creating a company in the early 80s. But for several reasons, including Richards getting cold feet, it did not happen.
In the end, it took a tragedy for Oxford Molecular to get off the ground. Richards's first wife, Jessamy, died of cancer in 1988 at the age of 42. "The day after her funeral I rang up Tony and said, 'Tony, you know that company we've been talking about starting? Let's do it.'" The company became a form of therapy for him. "Different people have different ways of getting over things like that," he says. "In my case, it is to work hard and to keep my mind off it."
Another woman also had a hand in Oxford Molecular's creation. The dedication of his book reads: "To Margaret Thatcher, who made much of this possible." "That would be a red rag to the Guardian, I thought," he laughs. But it was, he explains, Thatcher, a fellow Oxford-trained chemist, who in the mid-80s introduced two reforms that opened the gates for spin-out activity. The first was to change taxation rules to permit venture capital, a key source of financing. The second was to transfer the ownership of intellectual property generated by publicly funded research from the government to the universities, on condition that they set up mechanisms to exploit it. "That is when technology transfer offices took off in the UK," he says.
New industries
Later governments have built on Thatcher's reforms. "Certainly, under Blair, the 'third leg' of funding has become increasingly emphasised. And I think the present government under Brown and Mandelson realise that in our present economic problems, one of the few solutions would be creating new industries out of university research."
In fact, he says, since the government now part-owns the banks, it is in a situation to fix another problem that has dogged British start-up companies: namely, to create more secure long-term investment. "It's very easy these days to blame the City for everything," he says. "But in part this has been one of the City's errors. They have wanted their money out too quickly."
However, he reckons that the government's growing emphasis on knowledge transfer is a double-edged sword. With funding hard to come by, there is a temptation to hire new staff based on the money-making potential of their research rather than on the quality of their science. In the short term it may help finance a department, Richards says, but in the long run it will stifle the core business of universities, which should be teaching and research.
Funding agencies are becoming too prescriptive, he adds. "Today, all the research councils have committees setting up the 'grand challenges' for their disciplines. Personally, I think this is bullshit. Clever people will find grand challenges that other people haven't even thought of."
Richards points out that neither he nor his millionaire colleagues gave up on research. Even now, he keeps at it - for him, "retirement isn't going home and playing golf and doing gardening". However, he admits that his business forays may have damaged his career. "I think many academics are somewhat snooty about people who commercialise their work," he says. "If you look at the Royal Society, people doing very obscure things are much more likely to get elected than people who do something commercial. It is diminishing, but it is still there."
The good news is that there is a growing interest in spin-outs among chemistry students. One reason, he says, is that the large drug companies are laying off staff, making them less attractive employers. Students also increasingly want to be more than a cog in a corporate machine. But equally important, Richards says, it allows them to stay close to the university. Of course, he admits, seeing their professors driving fancy cars doesn't hurt. "They think, if that idiot can do it, so can I!"
Richards has a final warning for those expecting spin-outs to be a land of milk and honey. When the bottom fell out of the biotechnology market in the late 90s, Oxford Molecular took a tumble. "The short story of Oxford Molecular is that we started with £350,000-worth of venture capital. We took it up to £450m, and then we screwed it up and we sold for £70m," he says. "So we didn't do everything right, and I wanted to get that across to people. You are not guaranteed to succeed."
Still, by the time it was sold, Oxford Molecular had made the university £10m. At its peak, the firm employed 400 people and held 25% of the word bioinformatics market. Not bad for a lucky break.
• Spin-Outs: Creating Businesses from University Intellectual Property is published by Harriman House
Curriculum vitae
Age: 69
Job: Recently retired; still does some research and holds a number of non-executive directorships
Before that: chairman of Oxford University's chemistry department, 1997-2006. Helped set up Isis Innovation and founded Oxford Molecular
Likes: Exercise
Dislikes: Excessive bureaucracy
Married to Mary Phillips, director of research programmes at University College London. Two sons from a previous marriage, three stepchildren
;