Magda Wierzycka is planning her next investment project less than a week after making a surprise return to Sygnia as executive chair: a venture capital fund that will seek to raise up to R1bn to help SA universities commercialise their intellectual property (IP) in much the same way as Oxford University has done with Oxford Sciences Innovation (OSI).
Wierzycka told Business Day she is in the early stages of planning the investment vehicle and wants to raise between R500m and R1bn in initial capital to invest in projects in partnership with SA universities and other research institutes.
The idea will be to replicate what UK-based Braavos Investment Advisers, the £300m private equity outfit in which she is a partner, has achieved through its partnership with OSI.
the year Oxford Sciences Innovation was founded
— 2015
Braavos-managed funds own about 20% of OSI, which is an early-stage venture capital firm founded in 2015 in partnership with Oxford University to spin off commercially viable business ventures using the university’s scientific research.
It has already built a portfolio of about 100 companies worth more than $2bn, one of which owns the IP for the AstraZeneca Covid-19 vaccine.
"I’ve got some ambitions of potentially replicating the venture capital model in SA because we badly need job creation," Wierzycka said in an interview.
"We’ve got a lot of smart people but because there is no capital to fund them that IP just leaks out of SA — they leave with their research and their ideas and go to where there is capital."
Wierzycka says the idea came to her during the 2020 lockdown when she was confined to her home in Cape Town. She began setting up meetings with local pension funds to raise capital for deployment into Braavos.
of OSI is owned by funds managed by Braavos Investment Advisers
— 20%
Those efforts resulted in some of SA’s largest pension funds investing in the UK venture capital firm in an effort to gain access to OSI.
However, in every meeting she had with local investors she was asked whether she would be setting up an SA-focused version of the business.
"We could set up a company looking at the IP originating out of SA universities … and even the CSIR for that matter," she said, referring to the Council for Scientific and Industrial Research.
But Wierzycka, who last week made a return to Sygnia as executive chair a little more than two months after announcing she was stepping down and just nine days into David Hufton’s tenure as sole CEO, said she was still deciding on what structure the venture would take.
"I have a partner in the Braavos business in the UK, and he might not want to replicate the model in SA. Then I will do it under a different brand," she said. "I might do it under the Sygnia umbrella, but I’m still working out the precise business model.
"Obviously I would have to bring it to the board of Sygnia to see if they are interested — and maybe it’s not ideal that it’s done under Sygnia’s umbrella, because I would like to approach other asset managers as well as pension funds. Bringing in a BEE partner … would also be key."
Wierzycka said an initial capital raise of R500m-R1bn would be enough to commercialise local research opportunities for the first five years or so.
"We need entrepreneurship and innovation in SA — a lot of it exists but there is no capital," she said. "If we can marry life sciences with new technologies like artificial intelligence and machine learning, it could make a massive difference to things like reducing the cost of healthcare provision."
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