The UK university raising $1-bn through bonds shows the value of creating an enviable IP profile.
Oxford University raising $1-billion through sale of 100-year paper is making some major waves, and deservedly so. For a start, the bond sale raised the largest amount ever, by a UK academic institute. Second, this was the first time Oxford went the bond-route to raise funds, though its peers have done this before—Cambridge raised 350 million pounds in 2012, and UK educational institutes raised 1 billion pounds through bond sales in 2016. Many US universities have done it in the past, too. Universities in the UK are jittery about a review of their fees that is to happen in the coming year—given high tuition fees became a poll issue and may have cost the ruling Conservative party a significant chunk of the youth vote in the election earlier this year, it is likely that fees may not rise meaningfully or even remain stagnant. There are risks from the coming Brexit, too, as the EU may cut UK universities out of the research it funds. So, Oxford’s bond-success may give heart to UK universities at large.
Oxford is an old institution and has an enviable triple A credit-rating, and consistently rates high in various global rankings of universities. But much of the confidence universities like Oxford and Harvard (in the US) inspire in the market stems from the intellectual property these universities create and monetise. Oxford University Innovation, the platform that links research at the university with the market for monetising IP, was managing 2,873 patents and patent applications in 2016 and struck 855 deals, including 134 technology licences and 638 consulting agreements. Solid IP profiles, among other factors, have let Oxford, Harvard et al raise stellar sums from the market. This, obviously, defrays the risks (rising student debt, potential students giving tertiary education a pass, etc) from having to pass on costs to students. Universities in India, especially public funded ones, should take a cue or two from Oxford and peers, and create IP reputations that could attract funding by the market. That would lessen dependence on government funding while making sure that students are not burdened with the costs.