2013 cambridge the cambridge phenomenon an example of a local innovation system,chris green, chief executive, sqw group
1. The Cambridge Phenomenon:
an example of a local innovation system
“The Road from R & D to Commercialization – Better Productivity Better Jobs”
Chris Green, Chief Executive, SQW Group
20th June 2013
2. 1
Structure of presentation
Context
Historical development of the high tech cluster
Characteristics of the Cambridge innovation system
Is the cluster planned or market led?
Future prospects
Lessons for other places
3. The context
Cambridge sub region –
792,000 population – 11.5%
growth 2001-11, 40% growth
since 1960s
Greatly improved
connectivity, along with
increased congestion
Cambridge’s service centre
role has expanded hugely –
retail, leisure, business
services, etc – part
population driven, part
development from local to
regional role
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4. Historical development of the high tech cluster
Over the last 50 years, the Cambridge Cluster has
developed through several eras:
1960-1985: the silent and “un-hyped” evolution of the boffin-cum-
entrepreneur
1985-1995: increasing international profile and growth
1995-2002: dot.com boom and “Cambridge is full”
2003-2008: the new Spatial Plan and the Growth Agenda:
investing for substantial growth
2008-2013: local growth in the face of national recession
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5. Intellectual Capital
Higher Education
Research Institutions
[Strategic Alliances]
[Informed Networks]
Land, property, infrastructure
Locations affordable housing
Flexibility
Cost
Congestion
Environment
Services
Leisure
People
Education
Training
Entrepreneurship
Culture (international?)
Trust
IPR
In migration
Science Parks, etc
Choice or Frustration
Knowledge
Transfer
Spin-
outs
Inward
investors
Start-
ups
Existing
firms
Money and External
Business Expertise
Banks
Venture Capital
Angels
Accountants
Lawyers
Marketing Experts
Firms and
Sectors
Job Satisfaction
Local Politics
Housing
Travel to Work
Quality of Life
Local UK Global
6. Characteristics of the innovation system -
firms
In 1984 there were 260 high tech firms employing 13,700 people
main sector focus was electronics, instrument engineering, software and
technical consultancy
By 2008 there were 1,400 high tech firms employing 48,000
employees
sector focus was increasingly diverse, with particularly rapid growth in
biotech, software and telecoms
69% of high tech jobs in the service sector, 31% in manufacturing
Cambridge remains primarily a small firms cluster, although more of
the growth and opportunity is being driven by international owners
with their own perspectives on the future role of Cambridge
Different business models
more commercialisation through licencing
more soft starts
a renewed focus on manufacturing
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7. 6
Characteristics of the innovation system –
the research infrastructure
Cambridge University is outstanding:
THE 2012/13 ranked 7th in World overall, 5th in engineering and
technology, 2nd in life sciences, 6th in physical sciences
And it has also had a permissive attitude towards IP and a positive
attitude towards commercialisation
There are various national research institutes located in and around
the city. For example:
The Medical Research Council’s Laboratory of Molecular Biology
The Genome Campus – Wellcome Trust Sanger Institute
Babraham Research Institute
Cancer Research UK Cambridge Institute
National institute of Agricultural Botany
And various multinationals have located research facilities in
Cambridge, including Microsoft, Pfizer, Rolls
Royce, Schlumberger, Toshiba
8. Characteristics of the innovation system –
funding and specialist services
Funding technology businesses is difficult everywhere
The financial crisis has reduced the availability of loans and equity
investment
VC has declined dramatically, and has a poor track record in the high
tech sector over the last 10 years
However, Cambridge has a strong network of experienced business
angels, and an improving quality of investment opportunities as
entrepreneurs also become more experienced
The technical consultants are an important part of the cluster
Unique concentration in Cambridge area
Important originators of smart ideas with immediate commercial
potential
Increasing importance of links with London for funding, and
for specialist services
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9. Characteristics of the innovation system –
people
Working population is highly qualified
37% with degree level qualifications (UK average 32%)
High rate of business start ups – 40% above UK average
Entrepreneurship
Cambridge University Entrepreneurs Society – very active
Centre for Entrepreneurial Learning at Judge Business School
Good awareness of entrepreneurship in local schools
Stimulated by local success stories
Strong local networks
Private sector led
Constantly changing and developing, informal and formal
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10. Characteristics of the innovation system –
the physical infrastructure
Cambridge Science Park established 1970 – now home
to 100 companies and 1,650,000 sq ft of buildings
Other specialist property followed – by the University and
Colleges
St Johns Innovation Park
Peterhouse Techology Park
West Cambridge Research area, including the Hauser Centre
And by the private sector
Granta Park
Cambridge Research Park
Cambridge Biomedical Campus at Addenbrookes
In total – 5m sq ft of specialist property, and 5m more in
the pipeline
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11. Planned or market led? (1)
Much of the growth of the Cambridge cluster was due to
serendipity (e.g. CU’s relaxed attitude to IP), and was
not planned, and
In some cases, public policy has been unhelpful
Up to 2004, attempts to disperse high tech growth to places firms
didn’t want to be
Failure to keep up with infrastructure demands
Current difficulties in getting visas for international recruits
But…..
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12. Planned or market led? (2)
Government research funding underpins the strength of
Cambridge University and most of the research institutes
The basic infrastructure was crucial
Government funded – M11, A14, rail improvements
College funded – Cambridge Science Park, St John’s Innovation
Park, Peterhouse Technology Park
Strategic planning has become much more coherent and
supportive of housing and employment growth….and this
has meant the Government has been more generous
with funding for new infrastucture than in many places
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13. Future prospects
The key components of a dynamic cluster are in place
World class research and technology
Long term expansion of CU is assured
Strong firms, experienced entrepreneurs
Expertise and funding to support growth
Specialist property provision
Public policy commitment to growth
Investment by global high tech firms -
Microsoft, Pfizer, Astra Zeneca - suggests that
Cambridge is doing a lot right
Future is increasingly linked to London and the golden
triangle
Big question is whether commitment to, and funding
for, growth will be maintained.
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14. Lessons for elsewhere
Cambridge is unique, but….
It has exploited its assets very well – better, for example,
than Oxford
And it has developed the supporting infrastructure to
enable high tech firms to form and grow
“Cambridge is a low risk place to do high risk things” – Andy
Richards
But it (along with the rest of UK) is increasingly
dependent on London
Too much of the UK’s high level financial, business and
professional services capacity is based in London
And the private rather than public sector has been the
main driving force for the success of the high tech cluster
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