Interview with Alastair Hick

Monash University has been one of the most successful Australian Universities in creating spin-outs from its research, and Alastair Hick is the inaugural Chief Commercialisation Officer. He has seen many changes in how University commercialisation has changed over time, and has generously shared his deep tech journey with me.

How have you ended up involved in deep tech?

I had 10 years in the UK as a research scientist. I came out of university with a degree in chemistry and biochemistry, and started off as a research scientist in an agricultural research institute in the UK. Although I really enjoyed that, I didn't want to spend my life working at the bench or running a research lab, and decided to do an MBA.

I was lucky enough to get a scholarship to the Judge Business School to do an MBA. It taught a breadth of thinking that I didn't have from working in the research environment. What most interested me was how we can take this great knowledge and science that we're developing in places around the world and do something with it. A role opened up working at a small company that had come out of one of the public sector research institutes, working on implant microbial science with academics to commercialise their work. Then a role came up doing a similar sort of thing but with a broader remit across all Life Sciences at the Tech Transfer Office of Cambridge University that was being built at that time.

Around that time, we were starting to see the real start of an ecosystem development. So rather than individual things happening out of an organisation or between two companies or whatever, we were starting to see a lot more ecosystem development. How do people bring all the different parties together in a way that adds value to them, such that the whole is greater than some of the parts? That was really instructive for me because I could see how by bringing the right pieces together you could actually start to build something that was much bigger than you could do on your own.

It was time for my next next move, my brother was living out here, and I thought why don't we move over to Australia, so at the end of 2006 turned up in Melbourne. I was lucky enough to get a role at Monash, and that's where I've been ever since.

It's been quite a journey and it reflects how the deep tech commercialisation world has changed. When I started off, it was about finding some technology, protecting it, finding a partner and doing a deal, and what we have evolved to is an ecosystem approach which is much more sophisticated. Yes, we still find technology and do a deal, but we do a lot of work on that journey, a lot of de-risking, proof-of-concept funding, and engagement with investors and commercial partners before we do the deal.

Increasingly, we're trying to look at how we do this in terms of space innovation. So, how do we bring together people in a particular place to get them to engage more organically, rather than having to make things happen. We’re going from what was quite transactional to something that is about a whole series of relationships and an ecosystem that can achieve an outcome and doesn't depend on specific people to bring everything together.

For people interested in investing in deep tech startups, what do you think they should consider, compared with investing in other types of startups?

Many of the things are the same, but there are some additional considerations, and there are some sectoral differences. Starting with the biotech / therapeutic sector.

Developing therapeutics is highly technical and a very heavily regulated area. What you need to be looking at is the science: does the science stack up? And, compared to the market, what is the gold standard of treatment? Can you believe that the technology is going to lead to something that is better? Do patients, clinicians, and insurers or reimbursement agencies care? The science almost always wins out.

You end up with some quite binary outcomes. The winners can be exceptionally big wins, but there's a very high attrition rate. You need to have a big enough portfolio to deal with the risk.

Are you, as an individual or an investor group, sophisticated enough to understand the technology well enough, to be able to make a judgement?

Many of the other startups that we deal with are in clean tech, energy, materials, manufacturing and other areas. Technology still matters, and generally the things that we're spinning out are based on genuinely world-class research. Generally there are leading academics, and it's the sort of work that they might publish in the best journals in the world, but the challenges are often around the business side.

If we start off with, say, a material that's got some really interesting properties of energy storage. We demonstrate that in a lab and we publish a paper, and that gets people interested.

Then the question is, can you scale it? What about the techno-economics? Can you do it in such a way that your material can out-compete other similar energy storage devices? Then you have to ask what's our business model going to be? If we're competing with Panasonic, CATL, or BYD, where do we fit into the value chain? What is going to enable us to get into that? Those types of companies move very quickly from a technology development play into an operational business, and it's a very difficult transition.

Coming back to what should investors look for. You're looking for that breakthrough technology, but you're looking for a team who has an understanding of the challenges that they're going to face, and that they may not be necessarily the team that's going to take things all the way through. Do they understand enough of the journey ahead? They won't know what the final answer is initially because that has to develop as they understand their technology and the market.

There's an element of needing to understand what the intellectual property is, but you can get advice on that. There are plenty of good quality patent attorneys who can advise you as to the strength of patent applications, compared with what's out there.

Note that in the biotech space, it’s relatively common to exit through doing a deal before you've even got a product on the market. If you've got a drug candidate that has better characteristics than anything else that's currently on the market, people will be willing to pay for the technology.

When you're dealing with a physical product, generally you need to have something on the market first, and running close to a profitable business or one that has a path to profitability. It's very interesting, because the business side of it suddenly comes to the fore.

Can you give an example (or two) of an Australian deep tech company you’ve been impressed by?

I'll talk about a couple of things that have come out of Monash recently, and highlight this ecosystem approach that is a balance of the commercial and technical.

Firstly, ElectraLith, a lithium extraction and refining company. It came out of the research of Professor Huanting Wang, one of our top researchers at Monash, is world-renowned as a membrane scientist, and who developed a membrane that could basically purify lithium.

That started off as a very small experiment in a lab, and we worked with IP Group to develop a potential business around that and invested alongside them. IP Group brought Rio Tinto to the table, a potential end user, who also invested into the technology.

After this, we spun out the company, and started developing the tech. But the key thing that made very, very significant progress over the last two years was bringing on board a commercial CTO and a commercial CEO to run the company. At the end of last year they raised a $27.5 million oversubscribed Series A round with both local and international investors.

They're tapping into the ecosystem that we've been developing in and around the university. They're bringing in interns from our students, they're working with our researchers, they're working with CSIRO across the road. Hopefully, the first pilot plant will be in 2026, with major partners around the world, and will transform lithium extraction and refining across the globe.

Another startup is a company called Jupiter Ionics. Jupiter is developing green ammonia production. Ammonia is a $70 billion a year industry that is predicted to grow quite significantly over the next couple of decades. But it's highly carbon intensive, with basically two tons of CO2 per ton of ammonia produced using conventional techniques.

Again, we've done research, and developed an electrochemical way of producing ammonia from nitrogen in the air, plus hydrogen from water, and published this in great journals. That led to commercial interest, but it was interesting that we brought on a CEO to develop the business case before we had an investment. It was someone who had early-stage technology commercialization background, also chemical engineering background.

That company is starting to scale up its operations. Again there is that balance of technical, dealing with a lot of technical risk, but on the other hand understanding the market. It's very difficult for a small startup to compete with the major ammonia producers of this world. Building a plant costs half a billion or a billion dollars, if you want to manufacture at massive scale. There are some interesting market entry strategy questions that the company is addressing and answering.

Both of those startups came out of great research at Monash and they're both still based in what we call the Monash Innovation Labs, which is a space that we have here for some of our spin-out companies and other small companies who co-locate with us and work with the University.

What podcasts/books/people have influenced your perspective on fostering deep tech?

There’s really interesting work by John Howard in Canberra (not THE John Howard). John does great work on ecosystems, innovation policy, and has a very sophisticated understanding of the problems and potential solutions. John puts out blogs pretty regularly. Certainly really worth looking at what John’s thinking.

I am also always looking at global perspectives. There’s an outfit called Global University Venturing, and they have a parallel arm called Global Corporate Venturing. GUV and GCV put out regular podcasts with leaders from all around the world who are operating in this space. They cover how we get technology out of not just the academic world but also the corporate world.

Another thing is a global association in the US called Association of University Technology Managers. You would think it's just the universities, but it's actually sold at a corporates who play a role in that. They do some regular podcasts. The discussions that go on there have moved, much as my career has moved, from how do we get technology A out the door and into someone's hands, to much more sophisticated information ecosystem building, economic development, and the role of large academic institutions can play in that.

I'm always always interested in talking to people because I want to know what they do, to try and learn from them. I come back to the team, talk about how we can pilot it, and find out what we need to do to make it work for us, as opposed to doing something in Boston, or Silicon Valley, or Israel. It's always going to be different when doing something in Melbourne.