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Creative Destruction Lab expanding to Oxford University

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The Creative Destruction Lab (CDL) will open its first European incubator at the University of Oxford’s Saïd Business School, The Logic has learned.

Sources confirmed that CDL will announce its seventh location as early as next week. This will be CDL’s second international expansion in the past few months, after launching a program at New York University’s Stern School of Business in September 2018.

CDL, which began at the Rotman School at the University of Toronto, has become a magnet for venture capitalists, academics and entrepreneurs.

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Talking Point

The Creative Destruction Lab (CDL) is opening a University of Oxford branch in the fall of 2019, its seventh location since launching in 2012 and its second outside Canada. Former Google CFO Patrick Pichette is among those leading the expansion to Oxford. CDL is currently exploring opportunities in three other markets in addition to Oxford, though it did not disclose where.

Its first program outside North America is part of a broader push to grow its network globally. “CDL is currently conducting diligence on three other universities, all global leaders in specific domains and geographies,” said Sonia Sennik, CDL executive director, in a statement to The Logic.

Patrick Pichette, former CFO of Google and current general partner of venture capital firm iNovia Capital, will help lead the Oxford partnership, which has been in the works for about a year. Pichette, who sits on Twitter’s board, will act as a mentor to companies in the new stream. He served as a fellow of CDL-Montreal for the past two years and is an Oxford alumnus and Rhodes Scholar.

Also leading the expansion to Oxford is Thomas Hellmann, professor of entrepreneurship and innovation at the Saïd Business School, along with James Semple, who heads Oxford’s partnerships with STEM-related industries.

“Oxford is one of the world’s great research institutions with a uniquely prolonged history of intellectual leadership and scholarly accomplishments,” said Ajay Agrawal, CDL’s founder. “Moreover, all three individuals (Pichette, Hellmann and Semple) have ties to Canada and thus are well positioned to quickly connect to and enhance our network across the country.

Applications for the first cohort at Oxford open on April 1, and the program will begin in fall 2019.

The Saïd Business School did not reply to The Logic’s request for comment by publication time.

CDL bills itself as an alternative to the kind of incubators and accelerators that have taken root in Canada.

While most incubators tend to be locally focused, one of CDL’s core objectives is to disperse venture capital to regions outside Silicon Valley. As such, they’ve expanded to six locations in seven years, with plans to keep growing. Centres like Waterloo-based Communitech and Toronto-based MaRS, by contrast, have focused on growing tech ecosystems in their respective communities.

On the operations side, CDL doesn’t provide its ventures office space or charge them fees to participate. It doesn’t take equity and its mentors—who include Daniel Debow, VP of corporate development at Shopify; Janet Bannister, partner at Real Ventures; and astronauts Chris Hadfield and Anousheh Ansari—are all volunteers.

Each company selected by CDL is matched with a mentor and a group of two to three MBA students from participating business schools at the University of Calgary, the University of British Columbia, Dalhousie University, the University of Toronto, HEC Montréal and NYU. Over nine months, the company is pushed through a series of eight-week-long stages, during each of  which they must complete three objectives. The “Survivor”-like model sees companies that aren’t meeting objectives removed at the end of every stage.

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More than 1,000 companies applied to the last cohort, according to Sennik. Of those, 275 were admitted across CDL’s six sites and about 120 graduated.

The program was founded in 2012 by Agrawal, a professor at Rotman and co-founder of Next Canada, to redirect early-stage capital away from Silicon Valley to other tech hubs.

The program has attracted interest from big-name venture capital firms including Bloomberg Beta, iNovia and Khosla Ventures.

“We take seed-stage companies, specifically for the chance for them to get rich advice and judgement prior to raising a round and increasing their probability of success,” Sennik told The Logic before the last cohort launched in September 2018.

In some cases, mentors end up becoming investors and MBA students join the companies as early-stage employees. Alumni include Waterloo-based North (formerly Thalmic Labs), San Francisco-based Atomwise, Toronto-based Deep Genomics, Montreal-based Automat, Palo Alto-based Kyndi and Paris-based Heuritech. All told, graduates of the program have created over $3.1 billion in equity value, according to CDL.

The cohorts are spread over five Canadian sites—Toronto, Vancouver, Calgary, Montreal and Halifax—and the one in New York City. Each site has one or more streams focused on either deep tech, artificial intelligence, blockchain-AI, cities, energy, health, quantum machine learning or space tech. Oxford’s stream will also have a specific focus, which is yet to be decided.

The non-profit program runs on donations and grants. Major Canadian banks have made donations, including $2.5 million from TD and a combined $4 million from BMO and RBC towards CDL’s Montreal outpost. More recently, CDL was awarded $25 million from the federal government’s Strategic Innovation Fund to create 125 jobs and, in November 2018, it announced a partnership with the Canada Pension Plan Investment Board.