The Commercialisation Gap: Why Good African Science Struggles to Become Good Business

There is a familiar figure in African research. A scientist who has spent eight years developing a technology, understands it more deeply than anyone else, and has never been taught how to sell it. Not through any fault of their own. Selling was simply never part of the job.

That person is a good place to start, because the numbers alone do not tell the story. Stellenbosch University has produced 37 spinout companies over 22 years. The University of Cape Town reported 25 over 15 years. These are two of South Africa’s strongest research institutions, with established technology-transfer offices and serious research output.

Those figures are not evidence that the science is weak. They are evidence of distance – the long, quiet distance between a result that works in a laboratory and a company that someone will pay.

We call that distance the commercialisation gap. And from where we sit, it is not just because of one problem.

The first problem: translation

A validated research result is not a product. A patent is not a business. A prototype is not a market.

Between those things sits a list of questions that most research environments were never designed to answer.

Who exactly is the customer? What do they pay today to solve this problem? Is the problem painful enough to change behaviour? What does the product cost to manufacture at commercial scale? What approvals does it need? Who owns the intellectual property, and who owns the improvements made after the original licence was signed?

These questions tend to arrive late, and it is worth being clear about why. Research rewards rigour, depth and finishing the programme of work you set out to do. Markets reward something close to the opposite: the willingness to abandon your plan when a customer tells you it is wrong.

If the regulatory pathway turns out differently than expected, the company adapts. If the first market is too small, the company finds another one.

Expecting one person – usually the founding scientist – to operate comfortably in both worlds, with no commercial capability around them, is asking a great deal. A researcher can be exceptional at developing a technology and have no experience selling anything.

That is not a failing. Research and company building simply reward different skills.

Technology-transfer offices do real work here: identifying and protecting IP, assessing commercial potential, managing licensing, supporting spinouts. Stellenbosch describes technology transfer as a process that can lead either to licensing or to a university start-up. (Stellenbosch University) WIPO maps the lab-to-market journey through IP assessment, business-case development, product development, market development and commercialisation, and stresses that success depends on firms willing to invest the money and time to turn IP into products, and on markets able to absorb them. (WIPO)

That distinction matters. A technology-transfer office can protect an invention. It cannot manufacture demand.

The second problem: capital

Even when the translation goes well, the financing problem remains.

Research funding exists to answer a scientific question. Venture capital exists to generate a return from a company that can scale. The hard territory is what sits between them: a technology that has proven enough technical feasibility to deserve further investment, but not enough commercial evidence to attract a conventional venture fund. It may still need certification, field testing, manufacturing capability or a first paying customer before revenue can begin.

That is an awkward thing to fund. Too commercial to stay a research project. Too uncertain to fit the standard venture model. The South African academic literature says as much: traditional early-stage venture markets struggle with research-based ventures because of their uncertainty, their technical complexity and the difficulty of assessing them before proof of concept – and the same literature notes a shortage of commercial skills sitting alongside the financing constraint. (SciELO)

This is why “funding gap” is too simple a phrase. The problem is rarely that there is no money. The problem is that the type, timing and structure of the capital often do not match the risk being taken.

The wider market data makes the point. African startups raised approximately $1.44 billion in the first half of 2026, broadly in line with the $1.42 billion raised in the first half of 2025. But TechCabal tracked only 146 disclosed transactions in H1 2026, against 252 in H1 2025. Africa: The Big Deal, working from a different dataset, reported 190 ventures raising at least $100,000 in H1 2026 and flagged the same concern: capital concentrating in larger deals, and a shortage of smaller early-stage tickets.

A healthy headline number can sit on top of a narrowing pipeline. If capital increasingly follows companies that have already demonstrated traction, then the companies that need capital to reach traction find the crossing harder, not easier.

The answer will not be one instrument. Sometimes it is equity. Sometimes a convertible. Sometimes grant funding running alongside commercial capital, or milestone-based investment, or debt once revenue becomes predictable. What matters is that the structure reflects the risk actually being financed.

The third problem: capability

This is the least visible part, and the one we see most often.

A company can be funded and still not be ready. A founder can have a strong technical team and no commercial leadership. A board can exist without a single member who has built a company in the relevant market. An IP position can look clean until an investor asks who owns the improvements developed after the licence was signed. A cap table can work fine while the company is tiny and become a serious obstacle the day an institutional investor arrives.

None of this is unusual. What matters is when it gets discovered. Fixing governance in year one is admin. Fixing it in the middle of a capital raise is a crisis. Clarifying IP ownership before investment is diligence. Clarifying it after the investor has found the problem is a negotiation, on much weaker terms.

The same holds for commercial strategy. A company that has never tested who will actually buy its product can burn a large share of its first round answering a question that should have been settled before the round closed.

So capability is not a soft add-on to capital. It determines whether the capital works at all. Research on South African academic spin-offs reaches a similar conclusion: commercialisation demands specialised competence across many areas, universities cannot be expected to hold all of it, and investors can usefully do more than write cheques – including coaching academic entrepreneurs and closing information gaps.

That is roughly how we think about the investor’s role. Not a substitute for management. Not a consultant. One part of the machinery around the company.

Why the three get confused

The commercialisation gap is usually treated as a single funding problem, because that makes interventions easier to design. It does not make them work.

A grant programme funds a technically excellent prototype when the real constraint is commercial capability. An accelerator polishes a pitch deck when the company needs a regulatory pathway. An investor writes a cheque when the business needs a first customer. The interventions are not wrong. The diagnosis is.

The useful question is not “what does this company need?” It is “what is stopping this particular technology from becoming a business?” Sometimes the answer is capital. Sometimes it is a customer, or a licensing partner, or regulatory expertise, or manufacturing, or a commercial co-founder. Sometimes the technology is fine and the business model is the problem.

The first customer is infrastructure

The most underestimated asset in this whole process is the first serious customer.

There is a world of difference between “that’s interesting” and “we will pay for this.” The first is encouragement. The second is evidence. For many technology companies, particularly those selling into large organisations, getting from one to the other is harder than developing the technology was.

Here the contradiction inside large corporates becomes hard to ignore. A corporate can sincerely want to work with innovative young companies while running procurement processes built for established suppliers – warranty requirements, compliance thresholds, payment terms designed for businesses fifty times the startup’s size. The corporate says it wants innovation. The startup needs customers. The system between them was built for neither.

Which is why corporates can matter far more to commercialisation than as eventual acquirers. They can be early customers, testing environments, distribution partners, licensing partners, manufacturing partners, routes into markets. The relationship has to be structured properly – no startup survives on endless unpaid pilots – but a serious customer willing to take a commercial risk on an emerging technology can be worth more, at the right stage, than another investor.

The research base is not the problem

The continent’s scientific capacity has grown. The World Bank reported that African researchers more than doubled their STEM research output between 2003 and 2012, and South Africa continues to produce significant, globally connected research across health, biological, physical, environmental and applied sciences.

The problem is what happens next. A study commissioned by the UN Economic Commission for Africa examined the transfer of publicly funded technologies in Ghana, Kenya and Zambia and found significant hurdles in moving research outputs from R&D institutions into African markets. WIPO’s more recent work with South African universities and deep-tech spinouts makes the same point from the IP side: protecting IP is one part of commercialisation. Ownership, commercial strategy, market positioning, structuring and investor readiness decide whether an invention becomes a business.

So this is not an argument that Africa needs to get better at inventing. It is an argument that the institutions around invention need to be better connected to each other.

What better machinery looks like

Three things, in our experience.

Earlier engagement. An investor who first meets a company when it is raising capital inherits every unresolved problem in the business. Meet it earlier and those problems are still cheap to fix. This is why we keep our own pipeline connected to organisations such as the SA Innovation Summit, TechTribe Accelerator and RIIS – it lets us understand the technology, the founder and the commercial problem before the company arrives as a fully formed investment proposition.

Pre-investment work that means something. Working with a company on positioning, governance, IP or customer validation before investing is sometimes dismissed as advisory work. It is more useful than that. It tells you whether the business can absorb capital, and whether the team will change course when the evidence says it should. A data room tells you what happened. Working alongside a founder can tell you why.

Capital designed for the crossing. Some technologies need long development periods. Some need corporate partners. Some need grants before commercial money, others need working capital once revenue starts. Forcing all of them through one funding model is the mistake. The ecosystem needs different forms of capital at different points, with clearer hand-offs between them.

The harder question

Innovation ecosystems get measured by what is easiest to count: startups launched, funding raised, patents filed, incubators opened. Those metrics have their place. They do not answer the harder question.

How many technologies made it from research to revenue? How many patents became products, how many pilots became contracts, how many university spinouts became companies that lasted? How many founders built real businesses on technology that started in an African research institution?

Those are harder metrics because the journey is longer. They are also closer to the value we are actually trying to create.

Africa does not need to choose between research and entrepreneurship, or between grants and venture capital. It needs a better bridge between them. The commercialisation gap lives in that bridge – where science meets customers, where IP meets capital, where researchers meet operators, and where a promising technology has to survive the far less forgiving test of the market.

The science is there. The entrepreneurs are there. The capital, increasingly, is there too. What remains unfinished is the machinery that connects them.

And that, we think, is the more interesting investment opportunity.