Golden futures they cannot see

High technology innovation can yield huge rewards yet, a study reveals, few companies are seizing the opportunities on offer

British investment in new high-technology businesses is hamstrung by a lack of information and ignorance of the benefits of equity investment in future innovation, according to a report on corporate venturing which has just been published. The study "Window on Technology" by Withers, a City firm of solicitors, also concludes that - though corporate venturing is being carried out successfully in the UK - too few companies are involved. Moreover, a technology deficit is being created by the lack of funding for inventors and innovative entrepreneurs without proven track records. Lucius Cary, founder of the business angel matching service Venture Capital Report, is seeking to help to plug that gap with the launch of a technology venture capital trust aimed at the Oxford area. But since there is generally little investment activity, large companies have a chance to make themselves more fleet-footed by augmenting their research and development efforts in this way, as well as to enhance profits.

The report, which was published last week, follows an introduction to corporate venturing, "Gateway to Growth", which the firm produced in November 1995.

In that study, the firm described corporate venturing as the establishment of mutually beneficial relationships between larger companies and smaller innovative ones. Though primarily associated with large corporations becoming involved in cutting-edge technology by backing small firms with often modest investments, it can also include internal venturing, where investments emanate from within a company. In the current report, corporate venturing is defined as money invested by organisations in others as risk capital. The report finds that, while the objectives of corporate venturers vary across industry sectors, such investments are mainly motivated by a desire to achieve long-term growth.

Potential market size, growth prospects and entrepreneurial skills are the most important factors taken into consideration when planning an investment, with success dependent on an understanding of the innovation in which the venturer is investing, focused management of the investment and sufficient financial commitment.

Rates of return achieved with such investments in the UK are typically between 20 and 30 per cent, and that experience is usually enough to make first-timers repeat the practice.

David Gebbie, the Withers partner who wrote the report, based on statistical data collected by City University Business School, hopes the document will encourage large UK corporations to reconsider investing in Britain's innovation.

Pointing out that such organisations as the Bank of England and the Department of Trade and Industry see the practice as a key tool for maintaining a competitive edge, he added: "Our research concludes that, as the UK venture capital market matures, corporate investment must become the emerging enterprise's best hope of turning today's technology into tomorrow's products and services"

RT

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Sport
England's women celebrate after their 3rd place play-off win against Germany
Women's World CupFara Williams converts penalty to secure victory and bronze medals
Arts and Entertainment
Ricardo by Edward Sutcliffe, 2014
artPortraits of LA cricketers from notorious suburb go on display
News
newsHillary Clinton comments on viral Humans of New York photo of gay teenager
Arts and Entertainment
The gang rape scene in the Royal Opera’s production of Gioachino Rossini’s Guillaume Tell has caused huge controversy
music
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Recruitment Genius: Sales Assistant / Buyer

    £15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

    Recruitment Genius: Customer Service Advisor

    £15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

    Recruitment Genius: Compliance Manager

    £40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

    Day In a Page

    The Greek referendum exposes a gaping hole at the heart of the European Union – its distinct lack of any genuine popular legitimacy

    Gaping hole at the heart of the European Union

    Treatment of Greece has shown up a lack of genuine legitimacy
    Number of young homeless in Britain 'more than three times the official figures'

    'Everything changed when I went to the hostel'

    Number of young homeless people in Britain is 'more than three times the official figures'
    Compton Cricket Club

    Compton Cricket Club

    Portraits of LA cricketers from notorious suburb to be displayed in London
    London now the global money-laundering centre for the drug trade, says crime expert

    Wlecome to London, drug money-laundering centre for the world

    'Mexico is its heart and London is its head'
    The Buddhist temple minutes from Centre Court that helps a winner keep on winning

    The Buddhist temple minutes from Centre Court

    It helps a winner keep on winning
    Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

    Is this the future of flying?

    Battery-powered planes made of plastic, and without flight decks
    Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

    Isis are barbarians

    but the Caliphate is an ancient Muslim ideal
    The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

    Curse of Brink's Mat strikes again

    Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
    Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

    'The ministers talk to us about miracles'

    Why Greeks are cynical ahead of the bailout referendum
    Call of the wild: How science is learning to decode the way animals communicate

    Call of the wild

    How science is learning to decode the way animals communicate
    Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

    'The economic collapse has happened. What is at risk now is democracy...'

    If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
    The science of swearing: What lies behind the use of four-letter words?

    The science of swearing

    What lies behind the use of four-letter words?
    The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

    The Real Stories of Migrant Britain

    Clive fled from Zimbabwe - now it won’t have him back
    Africa on the menu: Three foodie friends want to popularise dishes from the continent

    Africa on the menu

    Three foodie friends want to popularise dishes from the hot new continent
    Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

    Who will fill Donna Karan's boots?

    The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'