Thursday, 22 September 2011

Venture Capital

In comments on this post, Andrew McGettigan points me to an Education Investor story about venture capital.

Speaking to EducationInvestor, Glynne Stanfield, partner at law firm Eversheds, said he was aware of five instances where “big private equity firms” are looking at buying part or even all of a UK university.
I have to confess this makes no sense whatsoever to me. Best as I understand venture capitalists, they seek to buy or invest in businesses which can be aggressively grown in value and then sold on. Quietly taking a steady profit on a steady business is not really the VC line (or so I thought), so buying a university in heavily-regulated England makes no sense to me.
I suspect some overselling by EI. The currently-ubiquitous Matt Robb makes more sense when he says:

there are “legally acceptable routes by which universities and investors can enter into partnerships that retain the best of both worlds”
Partnership around research commercialisation - where there is high risk and a potential IPO or sale to allow the VC to cash out in the medium term makes sense and if we see anything emerge I suspect it will be this.

No comments:

Post a Comment