🇬🇧 Loss Of Something Wonderful Invest, invest, invest says the Chancellor in the first few minutes of her budget speech… Shortly afterwards the incredible Reaction Engines slides into administration… The contrast needs no further comment… This ground-breaking company, which could have been a world-changer, has failed through lack of investment. Putting aside the large corporates that might potentially have invested and saved this business, it seems to me that here we had a national asset, with unique technology, that should have been supported further at a national level. Hypersonics is a critical area for UK. Unfortunately, as the great Physicist Carl Sagan put it: “We live in a society exquisitely dependent on science and technology, in which hardly anyone knows anything about science and technology”. This is especially true in politics (irrespective of party or political orientation). I am often surprised and disappointed at the apparent level of scientific understanding of our political leaders (of all persuasions - left, centre and right). It’s a shining prescription for disaster - for humanity, as much as the UK. I would like to pay immense tribute to Mark Thomas and the incrediblely talented and innovative team at Reaction Engines - true leaders in their field - most of whom have now been laid off… You gave me, and many others, pride and hope. #sadness #madness #technology #vision
We would all do well to remember that the reason Rolls-Royce employs 40k highly skilled taxpayers, has a market capitalisation in excess of £40bn, and leads the world in engineering excellence is that in 1971 a U.K. government saw the potential and backed it. In doing so it secured the place of the UK in aerospace, and it can be argued, created the opportunity for Airbus to champion Aerospace for Europe. It takes financial bravery to see these things across the line, and I don’t think our recent governments have had it. As evidence I would cite the slow and shadowy support of SMR and creation of economic conditions that make it more attractive for Dyson to do their R&D in Singapore.
Why would anyone want to invest in an economy that is overpriced, inefficient and uncompetitive shielded with red tape? Invest, Invest and invest with no lead times, institutional red tape, fractured rail and road road network. The blame culture on the predecessors and breaking manifesto promises does not give investors any confidence to collaborate with scientists and technologist in the UK anymore. I would not be surprised to see more SMEs throwing in the towel and calling it day. A sad state of affair. Some the words of J. Nehru, "The future belongs to science and those who make friends with science." some does no longer resonate with leaders of social dimension and perhaps why the USA is the destination for investment in leading innovations today.
I've been following the progress of my friends at Reaction Engines since its inception. About two decades ago, control of the company was taken from the founding Engineers, and lost to a self-installed board with no particularly demonstrable technical nous: their first act of mismanagement was to can the Spaceplane research division. After that, they reduced the company to mere heat-exchanger peddlers. Investors have finally had it with these short-sighted managers. The Sabre engine technology was proven to work, but the board couldn't care less. Sometimes, the only way to get a monkey off your back is to have the Company fold. What happens next is the clincher.
We no longer have national development projects that push the boundaries and create a sense of national pride and identity. Our governments (of all persuasions) are only interested in vote catching, short term goals, to secure re-election. How can a minister, who knows nothing on the subject, who is in office for a maximum of 4 years, who is guided by trusted advisers who know nothing about the subject, run a department of civil servants who know nothing about the subject, and will probably change departments every 18 months, make serious decisons about issues that will take decades to come to fruition and impact out society for a century or more? It doesnt work because it cant work!
This is terrible! No doubt the IP will be sold off by the administrators to a foreign company at a rock bottom price. We’ll probably see some grand announcement by a US company in a few years about a ground breaking supersonic aircraft employing this technology, meanwhile the Brits have sold the family silver yet again! #jetengine #jetliner #mobilephones #harrierjumpjet #tiltingtrains #maglev #wavepiercer #rollsroyce #MG #insuranceindustry
That’s because investors in the UK seem unable to understand technology businesses rarely make profits or revenue for a few years whilst they in the ‘deveopment’ stage which they demand nor do they appreciate ‘global’ opportunity
Someone in the US or India will come in and buy the IP. We will rue the day!
I see many examples of "remarkable science" in the life science business that scientist CEOs peddle for funding and want help with their pitch to investors. Unfortunately, 90% of these "remarkable science" assets are dead ducks that will never ever succeed commercially. Before delving into the life sciences, it's crucial to identify the 'unmet need', understand its magnitude, and determine the willingness of a payor to invest. How does it compare to the current Standard of Care (SoC)? Does it replace the current SoC at a lower price, or is it an add-in to the current SoC, which means it inflates the treatment costs? What is the health gain if it does inflate the health costs? Most cannot define these. In short, they are in love with the science but have no commercial clue! This avionics example reminds me of Concorde. It was a great feat of engineering, but a commercial white elephant. The payload was very low for passengers due to the narrow fuselage, which cramped the interior. Sector routes were restricted due to the 'sonic boom', special runway and boarding requirements at air bridges, and an astronomical price that was affordable and value for a narrow group of company account flyers.
The UK does seem to have a bit of a habit of coming up with gloriously romantic, inspirational aerospace projects, that have no viable business plan and insufficient capital backing. No doubt this will join the list of such great, historic "missed opportunities" that are often mentioned on this website. In the meantime, the uninspiring, unromantic projects of competitor countries go on to make fortunes. Vision is important but it mustn't be blinkered.
Chief Executive Officer
1moHugh, I just want to say a big thanks for your post, which has captivated hearts and minds and created a platform for important debate re. the contrast. Interesting to see this playing out and, to be honest, you had me with your opening line 😢