A portfolio of start-ups is created and an investment base is sought for the entire package. The system used at Karolinska Institutet is unique in the world, and creates better chances of success as well as healthy earnings for the investors.
The university is forever generating new science of considerable market potential. However, the lack of venture capital to cover the cost of early product development is just one of the problems hampering the commercialisation of scientific discoveries.
Karolinska Institutet has solved this problem in a unique way by forming portfolio companies. To date two such companies have been set up, named Karolinska Development I and II. Karolinska Development I comprises 16 start-ups and Karolinska Development II 18. Investors support the entire portfolio, and since their capital is invested in several different companies, their risks decrease in inverse proportion to their chances of success. The portfolio companies are supported by Karolinska Development until they are ready to launch their applications onto the market.
“Pretty much all universities help their research teams to market their discoveries,” says Ola Flink, investment manager at Karolinska Development. “We’ve solved the main problem of getting financing for such early discoveries in a hugely successful way. Our solution gives investors a greater chance of generating healthy returns as they invest their money in several different companies.”