In our fortnightly Research Culture Uncovered conversations we are asking what is Research Culture and why does it matter?

In this episode, host Ged Hall dives into the fascinating world of academic innovation and investment with special guests Duncan Johnson, CEO of Northern Gritstone, and Andy Duley, Director of Commercialisation at the University of Leeds.

Discover how Northern Gritstone, its founding universities (Leeds, Sheffield and Manchester) and shareholders are working towards creating a "Silicon Valley of the North" through delivering on its strapline ‘Profit with Purpose’.

🔑 Key takeaways:

1. Creating science or technology spin-outs through academic inventions is not ‘just’ about the science or technology; it's about validated value propositions, teams and a support ‘infrastructure’

2. Developing a successful ecosystem for spin-out companies requires collaboration among universities, investors, and other stakeholders, as well as a focus on talent development and early successes.

3. Programs like NG Studios play a vital role in accelerating the development of academic founders and preparing early-stage businesses for success in the market.

Links and initiatives mentioned in the episode:

• Connecting Capabilities Fund
• Duncan mentioned the Otley Road – this is a road that runs north away from the University of Leeds through Headingley. Many of the university’s students live in this area and it has a wide range of pubs and nightlife.
• Beauhurst - source, extract and package data from thousands of locations to create the ultimate private UK company database.
• Nexus - A vibrant community for innovators and entrepreneurs.
• Leeds Innovation Arc - The Arc is a series of innovation neighbourhoods, formed around the natural anchors of our main universities, the proposed adult and children’s hospitals, and major private sector partners.
• Deputy Prime Minister Geoffrey Howe’s resignation speech – analysed in this Guardian article
• Deep Tech Labs
• David Brailsford – marginal gains.

You can find out more about Northern Gritstone via its website and LinkedIn page:

• www.northern-gritstone.com
• https://www.linkedin.com/company/northern-gritstone

All of our episodes can be accessed via the following playlists: 

• Research Impact with Ged Hall (follow Ged on Twitter and LinkedIn) 
• Open Research with Nick Sheppard (follow Nick on Twitter and LinkedIn) 
• Research Careers with Ruth Winden (follow Ruth on Twitter and LinkedIn) 
• Research talent management with Tony Bromley (follow Tony on Twitter and LinkedIn) 
• Meet the Research Culturositists with Emma Spary (follow Emma on Twitter and LinkedIn) 
• Research co-production 

Follow us on twitter: @ResDevLeeds (new episodes are announced here), @OpenResLeeds, @ResCultureLeeds  

Connect to us on LinkedIn: @ResearchUncoveredPodcast (new episodes are announced here) 

Leeds Research Culture links: 

• Researcher Development and Culture Website 
• Our Concordat Implemention plans and progress 
• University of Leeds Research Culture Statement 
• University of Leeds Responsible Metrics Statement 
• University of Leeds Open Research Statement 
• University of Leeds Research Culture Strategy - launched September 2023 

If you would like to contribute to a podcast episode get in touch: researcherdevelopment@leeds.ac.uk

Welcome to the Research Culture Uncovered podcast, where in every episode, we explore what is research culture and what should it be. You'll hear thoughts and opinions from a range of contributors to help you change research culture into what you want it to be.

Hi, this is Ged Hall. And for those of you don't know me yet, I'm an Academic Development Consultant at the University of Leeds, where my specialism is research impact. And all of the episodes I contribute to the Research Culture Uncovered podcast relate to that, and they're all available in a playlist which I've included in the show notes.

Now, I've released an episode about that conference and the link is in the show notes. But to explore that commercial landscape, I'm joined by Duncan Johnson and Andy Duley. Duncan is Chief Executive Officer at Northern Gritstone, and he also holds non executive director roles at other investment companies.

Duncan Johnson 00:02:00

Yeah, um, thanks Ged for having me.

Thanks Ged.

Duncan, um, most people listening who work at a university will probably know of someone in a similar role to Andy, but their university may not be associated with something like Northern Gritstone.

Which is owned by its management team, a series of blue chip institutions, including several of the largest local authority pension funds in the north of England, as well as high net worth individuals, in addition to the founding university partners, which are Sheffield. Manchester, and of course, Leeds, and it has a really interesting strapline profit with purpose.

So, can you give our listeners an auditory tour of Northern Gritstone, you know, what it does and its long term aim?

So, Northern Gritstone is an investment company, uh, and our aim is to help and support, uh, ambitious Science and innovation based businesses become the world class businesses of tomorrow. We have this very focused [00:03:00] partnership, as you said, with Leeds, Manchester and Sheffield.

Universities and, um, we raised significant amounts of capital based on the potential of, uh, of that opportunity set. And the ownership of the businesses is quite a bit broader than you mentioned. We have raised about 312 million pounds of capital. And that's provided by the whole series of UK institutions, as well as local authority pension funds.

And I really think actually when we try and look at whether people believe there's an opportunity here, the quality of our shareholder list is sort of a really great proxy for that. I'm saying here's a great opportunity. Now, you mentioned the phrase profit with purpose, and that's a fundamental part of our business.

Um, it's also pretty clear, which is the chicken and which is the egg In that phrase, there is no purpose without profit. We have to return the right level of profit, uh, to our shareholders for the risk they're taking and what they're doing. But so many things flow out of us being successful in doing that.

And the focus on purpose is making sure that we care. And we focus and we drive that wider impact that comes from being a successful investment business. Now it starts at creating those world class businesses, but it also, uh, then comes from what, what impact does that have? Well, that that's creating well paid jobs.

It's creating a culture of ambition and aspiration. It's a driving local economic regeneration. where it needs it. And what we are really focused on at Gritstone is trying to be the, uh, a catalyst to driving, uh, the flywheel that is, is what happens when this starts to really happen properly. So that's bringing in more capital.

It's bringing in more talent. It's, it's encouraging more innovation activity in the universities. And when we look at other places around the world that have really got that flywheel spinning. The, the, the opportunities is immense and it's truly exciting, but it's important that we focus on both of those.

It's the profit and it's the purpose. And by combining those two together, that's how we are, uh, we are being a successful business, but it's, it runs through the spine of where we're looking to, to do things and how we're looking to do things.

Yeah, brilliant. I'm going to come back and get you to go into a bit more detail about that later on, Duncan and Andy.

But Andy, coming to you, I know from internal presentations you gave years ago that I was sat in the audience for, that the formation of Gritstone, Northern Gritstone, was a really big piece of work for you and colleagues at Manchester and Sheffield. So, can you take us through why you all got together and decided to kind of go through that, uh, that big piece of work to create Gritstone and what benefits you hoped it would create and, and, and have achieved?

Yeah, I guess it was a realisation that across the 3 universities, we've got, we've got some shared problems. Um, but the flip side of that is we thought we got some shared opportunities if we could work together to solve those.

So, we were, as 3 institutions, we were successful in creating these spin-out companies from a volume point of view, but frequently those companies were undercapitalised, so we weren't attracting the right management into them. We weren't giving them enough runway to really prove out the commercial commercial case.

If you are undercapitalised, almost from day 1 of closing an investment round, you're going out and trying to chase the next, the next chunk of money, which really detracts you a lot of the time from making the real progress you need to make within, within, within the company. I guess as, as 3 technology transfer offices, we were very separate.

I didn't know what Manchester did, they had no idea what I did, I didn't have a clue what Sheffield did, and there seemed to be an opportunity that some of that best practice and processes wasn't being, we weren't sharing, we all had separate networks and ways in which we interacted, so we could see that we all had.

Similar ambitions, and the shared shared challenges. Research England gave us an opportunity to apply for Connecting Capability Fund money initially providers with £5M and then with a couple of millions topping up to up to 7 and they were, they were very, they're providing pretty much on an experimental basis.

We had a thesis that we could have, how we would work together. They provided us with money to see if we could get that to work or not. And that Connecting Capability Fund became something we called Northern Triangle Initiative, which was a 'tongue in cheek' reference to the Golden Triangle, and it was a working title, which we couldn't, we didn't come up so that sort of stuck through the programme and most of that 7 million we used on proof of concept projects for 3 universities to look at early stage technologies and really shape those up so that they became investable propositions.

So, we wanted to show that across the 3 universities, we have the scale to produce an investable pipeline of opportunities that could underpin the creation of an investment company. Um, we also needed to know that we could work together with 3 universities, um, and that's not a given. Um, and the relationship side worked out really well.

Uh, it helped that the 3 of us were all called Andy. Um, so we, we, we at least didn't forget each others names, um, but we began to share that best practice. We've got healthy level of collaboration with, with some competition in there, but the competition really driving us to do as well as we possibly can. I wanted to go to an investment panel and have.

Um, so that led into us finishing bringing in, um, a couple of advisors to help us shape up what an investment company could look like. Um, and we really didn't have a clue at the beginning of that. So that whole journey from an ambition, much to raise a significant amount of money built on that university pipeline to creating Northern Gritstone was an incredibly long journey.

We sort of set the seeds of that. Um, we use some of that, that, that money to bring in key people to help shape it. Um, they in turn brought Duncan into the business and then Northern Gritstone took off from that, from that point forward. So, in essence, it was a shared problem became a shared opportunity. We can only achieve it by, by working together.

Yeah, it's brilliant to hear the, um, collaboration and competition kind of balancing out against each other. That's a really fascinating, uh, fascinating angle, uh, to take. Um, so. I guess I'm coming back to that kind of strapline that we mentioned and that profit with purpose and, and I kind of, it's interesting in terms of how that vision gets enacted when you're appraising the new opportunity.

So, Andy, I'll come to you first because that's usually where the academic inventor would go. would arrive first before maybe meeting Duncan. So how, how do you kind of implement that in your processes and practices and, and maybe what you've learned from Manchester or Sheffield in, in doing that?

I guess what we get disclosed to us is technologies So, an academic could come along and tell us that they've invented something and provide a level of technical detail.

The first step for us, right at that initial outset, is to turn that into a value proposition, which I guess is answering that purpose point. Um, and the Commercialisation team is drilled into them. I don't want them to talk in technology, I want them to talk in a value proposition. And the whole process that we have is, is taking a disclosure, trying to shape up an initial value proposition around it.

And we have a value chain that we take that through to try and prove out that value proposition. So it's all hypothesis model that we put in place to look at what commercial opportunity is, what the team looks like stage of technical development, commercial strategy, intellectual property and so on. And we take it from that value proposition as a quite sort of blurry concept at the beginning and try and drive it through a process that gives a sharper focus towards the end of it and validates it with the key market and drivers.

To turn that into an investable opportunity or a licensable opportunity at the end of it, and clearly some of those disclosures will fail for that process. And that doesn't mean it's failed from a point of view that there isn't any impact that can be achieved. Isn't suitable for a spin-out company or licensing opportunity.

And if we can move out those opportunities as being appropriate for Commercialisation or not more appropriate for the Commercialisation, but other impact routes, we try and do that as soon as we can in the process.

Yeah, absolutely. So there's still that, um, what can we, what can we do to make the world a better place, even if it's not via a commercial route?

Yeah, yeah, absolutely.

Duncan, I'll come to you. What, what, uh, how does it, how does that get enacted in, you know, when you're considering opportunities, uh, as that, uh, as that investment company?

Well, on an individual level, it is never difficult to see the potential impact of Of what an individual investment opportunity and, uh, can have because we are dealing with world class science.

That is normally applying to a world class problem that needs solving and you know that fundamental level, it's, it's, it's, it's almost a no brainer Ged in terms of what impact on an individual basis things can have. It's when you multiply that all together. And you have a business with the sufficient scale that Gritstone has, that it starts to have a really multiplier effect into one, the local and then the regional economy, and then the national economy.

And I think it's that element of the purpose. that really resonated strongly with our shareholders. This whole kind of, you know, the buzzword around this is place based impact. Uh, that's quite a mouthful if you've had, uh, been on the Otley Road, but, uh, you can say it slowly enough. Uh, and, um, what that is really about is saying, okay, by having a high tech, vibrant economy, That is driving off the sort of feed source that is the world class science that's going on in in the University of Leeds and University of Manchester, University of Sheffield, that you can have job creation, you can have the services that sit around that.

You, you, you had almost as a gravitational pull Ged of bringing in talent and capital and more ideas and this is that flywheel I've picked up earlier, but it's the aggregation of all the things together. And having a sufficient scale that allows you to have that focus on that wider purpose and impact.

And it is such a virtuous circle. And that's what's really important. So at the start of that journey, obviously, you have, uh, you know, you're, you're, you're the sort of baby steps. But what that means is you're, you're looking for early success and early opportunities to say, Look how good this is. Look what you could also do.

And, and working with Andy and his team at Leeds has been really successful in that in terms of let's showcase what, what that can look like. And that's how you get that flywheel to start spinning within the, within the university, uh, setting. But it is having the scale and, and that is actually one of the magic beans.

Northern Gritstone has is its scale and the ambition we set when we got going that has allowed us to have that type of broader purpose that really matters on the micro level as well as that broader basis.

Absolutely. And it, uh, with you talking about that scale, it reminded me of another, uh, um, piece of the Northern Gritstone's vision that struck me.

So, you know, I'm quoting here, over time, we will help create a Silicon Valley of the North. Uh, so that made me think of that kind of big ecosystem that we're, we're all, we all hear about from, from Silicon Valley. What's your take on that and what needs to happen across the North of England to bring that to a reality?

. .

So this is echoing quite a few comments made by Andy in, um, in his description of the, of the challenge slash opportunity that, that manifested eventually in Northern Gritstone. So one of the ways we were able to raise the money and raise the capital for the right, at the right scale, we're saying, wow, this is such an untapped seam of opportunity.

of England. And despite the fact that actually R&D spend in the North and South of England is pretty well exactly the same, about 1.2 1.3 billion between the North and the South. And also for the fact that of, of the 19 top 100 universities in the world that are in the UK, nine of those are in the North of England.

So you have this very level playing field of science and technology and R&D spend, but a totally, um, uneven playing field of where the capital is going. Now that creates an opportunity. What, what challenge does that create? Well, the challenge that creates is you haven't got this flywheel. So you haven't got the exited entrepreneurs, the angel investing community, all those things.

And every time a successful business exits, there's three or four people that may come out of that, that are ready for the next, trip So you get this incredible compounding effect of talent into the local, uh, community. And for to create the Silicon Valley of the North, it's not just about funding. In fact, I really believe that funding follows quality opportunity.

Capital is incredibly good at finding the next great thing to invest in, but quality spin outs have much more than just an idea. And, uh, much more than funny. It is about the talent. It is around the business model. It's about the timing. And one of the things that we work really hard on with Andy and his peers at, um, Manchester and Sheffield is around the whole talent piece, making sure that we have the best team we can right from the start of the journey.

But also that team is ready for the race. And I know we'll come on and talk about this, uh, during is, is what is why we have NG Studios, because we need to have these sort of bootcamp training camps, whatever we want to call them, venture builders, accelerators, that is getting people ready for what is a really difficult race.

We have to be really resilient. You've got to be ready for it. You've got to know what's likely to happen and how to react to it. And, uh, that is how we get to the Silicon Valley of the North is by getting the quality there that will lead to the quantity that then keeps. We're, uh, moving us forward, but there's no, we have the fundamental ingredients.

We've just got to use them very wisely and make sure we get some good early successes that will, will keep the whole thing moving forward. But there's no reason why that ambition, that aspiration isn't entirely deliverable. You know, we, we have so many good things going on here.

Yeah, Andy, I'm going to come to you and kind of focus in on what the higher education sector needs to either do or change about the way we operate to kind of get into that vision that Duncan has just set out.

For universities to have a scalable and sustainable model for spin out creation, you have to have a developed and thriving ecosystem. Otherwise, we're creating companies that we're effectively spilling out into into a desert, and they aren't going to fire and they aren't going to going to prosper. And historically, we've had to put significant amount of time and effort and resource to try and compensate for the lack of ecosystem that we around that can support our companies.

So, the university's long term interest, we need an ecosystem which is, which is effective. And, you know, that allows us to scale the level of activities and get the benefits that, that, that Duncan's, uh, mentioned in terms of creating those successful companies, employ people, increased investment, increased, uh, uh, uh, uh, turnover and profit.

Um, I think from a university, the role that we can play in that, It's it does that sort of enabler and a key sort of anchor institution within the, uh, within the, within the region. So, Northern Gritstone is a, um, is a, is a, obviously a great example of how the universities have come together to help support that.

But Northern Gritstone is an independent company. We set the scene for it, but Northern Gritstone has done the work to create Northern Gritstone and manage that activity. And that's the way it should be. University shouldn't be running. Capital companies, because we're not skilled or equipped to do it.

Um, other examples in Leeds, invested over 40 million to create Nexus as a, to create a community of, of, of, of innovation driven enterprises within Leeds city region. Um, and, you know, that hopefully Will be a seed, which leads into the development of the university enterprise zone, Leeds Innovation Arc and so on.

So we're, we're, we're playing our part in it, but it needs a whole range of stakeholders to come together. I think the other thing that I would mention is that as well as that external ecosystem. Universities have their own internal ecosystems and how they work with researchers to help them develop opportunities that could become spin out companies.

We have to look at our own internal innovation ecosystem and make sure that it's fit for purpose and that it aligns externally. So, you know, what is the culture that we create within the university around enterprise and entrepreneurship? What are our policies and processes that enable people to do that?

What reward mechanisms do we have in place? How do we use the resources that we've got to achieve that and so on? So I think there's careful work that universities can do to create their own internal ecosystem and that's directly within our control and we can help influence and support as best we can that creation of an external ecosystem.

Yeah, for that. And Duncan, you kind of segwayed into it. Into this question, you know, being a, being a trainer and organisational developer, I'm really always interested in, uh, uh, in training programmes and, and mentoring and coaching and all those sorts of things. So, um, obviously I'm fascinated by. Um, NG Studios, your accelerator programme, uh, for early stage businesses.

Um, and I believe you've just finished working with the first cohort through that, through that programme. So can you describe it for us in a bit more detail and its benefits and any kind of learning you've, you've, um, you've, uh, generated through that first cohort?

So it picks up on a comment Andy made before about spinning businesses out into a desert.

and with insufficient capital. So what, what, what we saw was this problem that, uh, whilst we may get businesses to the start line with Andy and his, and, and his colleagues, we, they weren't fit for the race. We, we were almost handicapping them. I remember the great, uh, uh, resignation speech by Geoffrey Howe about having your cricket bat broken by the captain.

It wasn't quite as close to that, but it's not a bad analogy. And, um, so I went off with our CIO at Northern Gritstone, Marion Barnard. We went off to visit MIT and Harvard. And we went there to say, okay, which, what, let's go and look at what a mature, um, community ecosystem looks like. And what can we bring back to the Northern Triangle that will help us get there quicker?

And really that was the genesis of, of NG Studios. There's something in, in Boston called The Engine. Um, and we looked at it and said, okay, here's, here's really high quality, uh, programme for pre spin out. Pre seed teams, challenging, testing, mentoring, and getting people ready for the For the journey. And, and that was really the, the coming back and saying, okay, that's the one thing we can do in the near term that will accelerate, uh, what we, what we're trying to do at Northern Gritstone with the, with the university teams.

And so we then looked around the UK and said, okay, let's go find the best possible people to, um, run this programme for us. You have the, the, the community, the mentors, the skills of how to do this best. So I'm a believer that. In the fullness of time, of course, we'll have all these things on our doorstep.

But at this moment in time, we don't. So we have to accept we don't have these things on our doorstep. So let's go and find the best, bring it in, teach ourselves, and then down the line, we'll be able to do it. But in the meantime, we need to go and find those, that skill set. So I'd known the chaps at Deep Tech Labs for a couple of years.

We've been talking to them and, uh, trying to work out how we could work with them. They run Deep Tech, uh, accelerator programmes within the, within the Cambridge ecosystem, uh, they're owned by Arm, Cambridge Innovation Capital, and a couple of other, uh, people from that ecosystem. And, uh, Miles Kirby and David Green here, the guys who run that really are incredibly well connected.

So what we set up was a programme changed for what we were looking for, but with the same quality of mentors and fireside chats and, and, and structure to it. So it's a 12 week programme. Uh, there is a pretty, uh, uh, hard selection process to get on it. This isn't sort of everybody gets in it. You've got to sort of work to get on it.

Um, uh, companies that come in and get investment from Northern Gritstone, uh, to sort of see them through the programme and help support them during that period. And, uh, during the programme, it's split up into three parts. One is about. team, one is about your business plan, then one is how you talk about your business plan about fundraising and that whole piece.

And it's quite a soul searching programme. You've got to be pretty resilient. And we know that's one of the characteristics we're looking for in the teams. This is hard work. There's a great line by Bill Gross, who's the founder of Idea Labs, he quotes Mike Tyson. And he thinks that being a management team and a startup is exactly like that.

Everybody has a plan until you get punched in the face. And it's true, you as a management team, we've got to be able to move and think and react to things. So just getting ready for that, you know, doing the sort of sparring, I suppose, is really important. So, uh, we ran the first cohort. Uh, the selection for, for the cohort is, is a collaboration between our Northern Gritstone, Deep Tech Labs.

And the three, uh, Commercialisation teams at the three universities. So it's highly collaborative. It's very similar to how Andy described it under the Northern Triangle Initiative. We use that as a good example of how to do this of, uh, competition and collaboration. That's quite an effective mix, actually, if you keep it, uh, keep it within a sensible boundary.

And from that, we chose six, uh, businesses for the first cohort. The demo day, which is the sort of culmination of the whole thing happened in Leeds a month ago, we had I think we had just about 300 people came to the demo day of which 112 were investors, a really strong convening. effect of getting high quality investors.

And of that number, 112, over 50 percent of those investors were overseas investors coming to look at what we have here. And that's a really good thing, really good thing to be crowding in that quality of capital. And five or six of those businesses are either have received their seed round funding now, or are in the late stage of, of raising seed funding.

So we would say that's pretty good. as an initial indication of success really strong. Of course, real success is, ultimately, are you a successful business? But the next sort of staging post is in three years time, have you got to the next funding round, typically the Series A raise? Have you raised five to 10 million pounds at a good valuation?

And, and one of the other things coming back to Andy's comment about spinning out into a desert, we are wanting these businesses to be able to raise between three and five million pounds on their initial raise. So when I first came to Leeds and I first met the opportunities, every single business said they were looking to raise £250,000.

And I said, why are you saying £250,000? And they said, well, that's what we can raise. I said, well, there's just no point. There's no point in starting that journey. You are going to fail. And it's that characteristic that Andy described at the beginning. So we want the businesses to be able to raise a proper amount of capital that gives you the best chance.

Of getting to that next milestone with the best team in place with the best commercial proposition. So that's what NG Studios is trying to do, bring world class mentoring and a programme to help people be the best they can be and give you the best chance of success.

That's fantastic. Andy, I'm going to come to you because, um, really, I guess your role is kind of making sure that, uh, some of the early stage disclosures are kind of ready for the, um, for the challenge that NG Studios provides and as well as the support.

In that so that they could be successfully taken on to a cohort. So what do you do to get to kind of get people ready for kind of pitching to be in the cohort?

What about that value chain and how we, we, we build out the opportunities and get from that, that, that we're building out that initial team, we're building out that initial, um, um, strategy.

That is, you know. That we don't think we can raise as much money as we, uh, we, we, we probably should that, you know, we tend to be more more cautious in terms of strategy and so on. So NG Studios really challenges that strategy, brings in key people to, to, um, Work out what actually this company could be, um, and drive that ambition within the strategy.

I think the key things that I see from that is, you know, as well as building the strategy within the company, it's building the people, um, it's building the confidence and the belief in them. I mean, the way it was the programme works, there's an initial pitch that they, they, they provide and at the end of the programme, there's, there's a, on the demo day, there's the final pitch.

Huge night and day difference between the 1st pitch and the end. And it's the most striking thing for me is the people and the belief that they've got. They're standing up and they're talking about an ambitious strategy and they believe that ambitious strategy. Um, and if they believe it, um, then there's much more chance that their customers, their investors and their other stakeholders will believe it as well.

Yeah, absolutely. I mean, having that having that clear vision is kind of absolutely necessary for any route to impact in terms of what is it that you, you want to have, whether you go through a commercial route or not. So that's, yeah, that's really important. So, um, We're kind of coming towards the end of our, our time together, but, but I just wanted to kind of think about, uh, think about the future because, um, Northern Gritstone has a 15 year framework relationship with the, uh, with the three founding universities, if I've understood that correctly.

And for all stakeholders involved in the relationship, what are the measures of success? So Duncan, I'll, I'll come to you first in terms of, you know, you said it isn't just owned by the universities or the management team and there's a whole range of, of others. So what, what for you is success over that 15 year period?

So it's really delivering on both the profit and the purpose side, Ged, if you really take it back to its boldness, and then the purpose side, you know, that, that piece of the equation directly flows into Andy. And the teams there have we backed, uh, sufficient numbers of spin outs from the university to support what Andy is trying to do internally.

So have we been good business partners? Um, I, I would hope that to date we have been. And we are being and we carry on will be and that's us working very closely together. Our office in Leeds is in Nexus. It's only probably 100 meters away from Andy's office. Nexus is a is a something to be proud of.

Within the Leeds, uh, uh, innovation, uh, family. It's, it's a brilliant space. It does work. It does bring people together. It does have that, um, Brownian motion effect. That's really important for this. So just more and more of that. Um, but for our shareholders, we have committed to return to them, uh, the right level of return.

Now what's the right level of the right level return is to be a quarter one performer, which means we need to return. A percentage return on the capital invested in us of over 20%. And that means increasing the value of Northern Gritstone and four to five times in the next decade. Now that is. hard. No doubt about it.

You've got to be good to do that. So the challenge that sits with us as the management team at Northern Gritstone is, are we the best we can be? And, uh, I've already mentioned the David Brailsford thing around how our attitude to what we do with, um, uh, the businesses we partner with, but that is exactly the attitude we have in our own.

Organisation. How can we be better tomorrow than we are today? What, what, what just little nudges can we move ourselves for? There's an amazing factor that's clearly rubbish, Ged, but it's all, I just love it as a, as a, as a thing to call out if you improve your performance 1 percent every day. Which doesn't, it's not particularly difficult, is it?

But by the end of the year, you're 37 times better than the start of the year. Now, even if you give yourself a few days off on that, and you give yourself a holiday and you only do it on the five days you work, you know, you are still 25 times better. So, just making sure every day you do something better, you think about things a bit differently.

And how we can work better with everybody makes a massive difference and that's the challenge. If we are trying to compete on a global stage, which we are, that's, that's actually the bar we have to set ourselves. So for us to return Q1 Returns to our shareholders, that's, that's, that's our competition. It's not a local thing, it's not a region, it's not a national thing, it's an international thing.

And, um, that's actually what really excites and drives me is that challenge. That challenge that we need to be that. Good. And you mentioned that you like training and those sort of courses. It's all about that. It's all about, uh, how can we do everything a little bit better? How can we work better with Andy and his colleagues?

How can we work better with the spin out businesses? How can we make their journey that little bit easier, that little bit better, that when you compound that over a portfolio of 80 to 100 investments, which is what the steady state of Northern Gritstone is, all together gives you a better chance of success.

And we've got to make it work, because if we don't, we're going to, we're going to move backwards. So that, that to me is, is, is success we need to do and a lot rests on it and, uh, but it's a challenge we're well up for and I think we're making good progress today, touch wood and all that.

Yeah, fantastic.

And Andy for you, um, I mean, I'm kind of thinking maybe in 10 years time I might actually not be at the university because I'll be, I'll be watching cricket somewhere retired. Um, but, uh, so I don't want to speak for you. I don't know if you, if you're going to leave at the same time as me, but, uh, you know, maybe at the end of the 15 year period, what, what does success look like?

Not unless you know something I don't

Yeah. What, what does success look like for you in, in terms of that, over that time period?

The framework agreement is for an extra 15 years for the reason, um, because. And it goes back to that ecosystem point that we've, that's reoccurred through this, uh, this discussion, you're not going to build a successful thriving ecosystem in 3 years, 5 years, or probably even 10 years.

You know, you need that 15 year window to do it. So ultimately success at the end of it is that we have an ecosystem that there's a natural flow of opportunities out of the university and that seamless and ambitious creation of those companies. We have that virtuous circle that Doucan reference tonight, the pool of talent that's attracted around them that we have.

Other Northern Gritstones operating within our ecosystem because they've seen the success that, uh, that Northern Gritstone has, uh, has, has had, um, and ultimately, from a, from a Leeds perspective, what I guess, really, you know, ultimate success from a city point of view. Is that we've got those jobs, we've got the turnover, we've got the investment that comes into the region, that Northern Gritstone investors have got the return from operating within the Northern ecosystem.

And I guess it's about reputation. You know, when people talk about success. That Northern ecosystem is on the list. Um, one of the examples we recognise for what we've, what we've, what we've achieved.

Yeah,

absolutely. So it's kind of in there in terms of the government language going around in terms of where the, where the big.

Um, with a big growth area as well.

Yeah, and it's referenced at the moment as the potential that we've created. And so I can say this is a real focus on us, about how that's going to develop over the years. And I think it's almost a successor in our, in our hands.

Um, Absolutely.

Duncan, do you want to come in?

Yeah, I just want to pick up something Andy said there, because I don't, not sure this is the reaction most people would expect, but Andy's comment of there needs to be more than more Northern Gritstones is exactly correct. There is more than enough space for four or five Northern Gritstones, and it's a highly, highly collaborative space we work in here and absolutely success in that wider purpose would be four or five other Northern Gritstones.

And, and, you know, all of us lean in to try and help other, uh, investment businesses set up in this space. But, you know, there's a mantra here that runs against my normal mantra, which is more is less is more, more is more here, more talent, more capital, more ideas is a good thing. And absolutely success in 15 years time would be another four or five Gritstones with that.

Quantity of capital,

brilliant and we'll leave it there with our optimistic future. So, um, I wanted to thank you both for your time today. You know, I know you're, uh, you're both busy people. Um, so it was great to be able to manage to get this into your diaries. Um, so. But I'll, just to finish off, I'll pass it over to you to say goodbye to our listeners.

So, Duncan.

Ged, thank you very much for, for giving us some time to talk about Northern Gritstone. I really enjoyed it. And I hope your listeners enjoy it too.

And Andy.

Yeah, thanks Ged for the opportunity. Yeah, I've enjoyed the conversation and that, you know, people. Find it useful.

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