The Academic Adventures Podcast

"The spinout process is definitely not an easy one" with Nanik Ramchandani

• Converge • Season 2 • Episode 8

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Nanik Ramchandani is an entrepreneur with over twenty-years’ experience in the financial services industry all around the world. Now based in Edinburgh, Nanik has worked with Edinburgh Napier University for many years. He was an Entrepreneur in Residence in 2023/24 and helped establish the Scottish Centre of Excellence in Digital Trust. He is now working alongside academic co-founder Zakwan Jaroucheh to spin out cybersecurity company Lasting Asset. 

Sarah and Nanik talk about

  • His entrepreneurial journey and why he got involved in research commercialisation
  • The unique challenges of launching a university spin-out compared to a typical start-up
  • Why spinouts need support to get beyond proof of concept and land their first customer
  • How universities might attract and incentivise more commercial champions

 Connect with Nanik on LinkedIn

Find out about Nanik’s new spinout business Lasting Asset

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This podcast was a collaboration between the University of the West of Scotland, Converge and Sarah McLusky, working in partnership with Ross Tuffee and The Connect-Ed Network. The podcast team includes Orla Kelly, Adam Kosterka, Jen Black and Sarah McLusky. This season of Academic Adventures is supported by the Scottish Funding Council.

Nanik Ramchandani:

You'll often hear in the university is that we have a solution, but we are looking for a problem. Which is the reverse of how typically a startup should be done. I think most businesses work at human years, large organizations. Startups need to work in dog years. You need to do things seven times faster. But universities work in snail years, right? Actually taking something to production is a whole different ball game and getting a first customer is a huge challenge.

Sarah McLusky:

Welcome to the Academic Adventures Podcast. This podcast is all about the journey from teaching, research, and innovation to real world solutions. For season two, we are joined by experienced founders and other experts who work alongside university staff and students to help create and support a culture of enterprise on campus. Hello and welcome to episode eight of the second season of the Academic Adventures Podcast. I'm your host, Sarah McLusky, and my guest today is Nanik Ramchandani. Inspired by the eighties movie Wall Street, Nanik initially became a stockbroker before discovering the world of entrepreneurship. His career in financial services has taken him around the world, including Dubai, Singapore, and Geneva before he settled in Edinburgh and developed his relationship with Edinburgh Napier University. This collaboration has included being an entrepreneur in residence and he also helped to establish the Scottish Center for Excellence in Digital Trust. He's now working alongside academic co-founder, Zakwan Jaroucheh, to spin out cybersecurity company Lasting Asset. In our conversation, Nanik shares the realities of building a university spinout from legal wrangles to building solid financial foundations. We also talk about why spin outs need more support to get beyond proof of concept and land their first customer, and how universities might attract and incentivize more commercial champions. Welcome to the podcast, Nanik. It's fantastic to have you here. I wonder if we could begin by hearing a bit about yourself, who you are, and what you do.

Nanik Ramchandani:

Okay, great. Thanks Sarah. Likewise. Lovely to be here. Um, I'm Nanik Ramchandani. I'm currently the co-founder and CEO of a business that's just spun out of Edinburgh Napier University 77 days ago and I'm counting. It's a business called Lasting Asset where we are we are on a mission to stop imposter, fraud, imposter or impersonation fraud. In, in America they like to call it imposter. Here we call it impersonation. But that's why I'm, of course the long journey to get to where I'm, but we can talk about that as it goes along. Yeah.

Sarah McLusky:

Yeah. Thanks for setting the scene there. I love that you are still counting it in numbers of days since it started.

Nanik Ramchandani:

The clock starts the day you spin out and it the pace increases. Yeah. Two or three x of four x, which people don't necessarily realize, so I. I, I keep counting and keep reminding my team. It's been so many days, my God, we haven't done what we should have, so let's keep it, keep it going. Yeah.

Sarah McLusky:

Yes. I feel like it's almost like they talk about politicians and things the first a hundred days. I imagine it's a similar, it's a similar crazy time. Yes. So this is not your first foray into doing financial technology type businesses, is it? So maybe if you could tell us a little bit about your background and how you've ended up here.

Nanik Ramchandani:

Yeah, sure. It's a long story. Going back some 25 odd years and, I was in India that, that's where I grew up. And in my early teams there was a movie called Wall Street, which kind of was the movie of the era, which kind of shaped a lot of careers, including mine, where there was this character called Gordon Gekko and everybody was like, my god, this is like the hero. He was actually a villain in there, but it was like, yeah it started my career in financial services. I was always comfortable with numbers and that was very clear at that point that what I wanted to do was run my own hedge fund and so on. But, so my first job after doing my master's was working with a stockbroker. This is like 99, and my biggest client said. Hey, I've just invested in a.com, so come and run it for me. So this is 99. And so we started what was then capital market education site and and also a social media site, which was interesting because those, both those categories were exploded after. And so that was my first introduction to startups. Absolutely loved it. Then the world changed in 2001, and I continued to work on different startup ideas, including tutoring kids in the US from India, doing book reviews, Amazon was getting big then, but finally in 2003 decided to go back to business school and that started a 15 year career in financial services. Long story short, I did run the hedge fund that I always wanted to do, and Murphy's law things never go as planned. realised this was not what I really was inspired to do, and midlife crisis, I've gone back to my true love of startups. So that's been the backward journey in back 2018, 19, I was working, giving some advice, doing some consulting work with scale ups in the, mostly in the financial sector. And that was also the time we had moved to Edinburgh, which is now home, and somehow got involved with Napier and that started my new journey in entrepreneurship, commercialization, and so on.

Sarah McLusky:

Yeah. So tell us a bit more about that. So your connection has really been with Napier University. How did that start? What sorts of things have you done together?

Nanik Ramchandani:

Yeah. No it was a very serendipitous interesting story. Way back in, in 2019/20, I was working and advising different startups and scale ups and we had moved to Edinburgh at the time. And so there was a Entrepreneur in Residence at Napier at the time, Jamie Graves, who was leaving it was end of the year. It was end of 2021, and he was helping a project at the time run by a young bright PhD called Pablos. And somehow we got in touch and Jamie asked if I had time to support him. Pablos and I got along really well. I. And that just started, I became a commercial champion to support Pablos, which was now at that stage we were applying for the high growth spin out opportunity qualification grant. It went on to get the company creation grant and an Innovate UK cyber A subgrant. So kinda just grew arms and legs. And around the same time I also met Bill Buchanan. And if you don't know Bill, he's one of, he's like a force of nature in Scotland. He's been, he's one of the pillars of Napier. Been working there for 36 years as a professor. Absolutely loves what he does. Like he's got more energy than a 17-year-old on his first date. But, and just an incredible human being. And I ended up working with Bill on a bunch of things, including setting up the first centre of excellence in digital trust in Scotland, where Napier is the founding the founding university alongside Glasgow and University of Edinburgh. Bill also got me to apply for the Royal Society Entrepreneur in Residence Scheme. So I was the Royal Society EIR in 23/24 at Napier. Also got involved with the second project where Zakwan, who's now my co-founder at Lasting Asset, was working on a bunch of different problems and I worked alongside with him over the last two years and again, getting multiple rounds of funding, getting the project from what was an initial idea on crypto asset custody to now stopping financial fraud. So it's been a very intense four years where somehow I've just gotten involved with Napier and gotten intertwined in the system then.

Sarah McLusky:

Yeah, it sounds like that really was a meeting of minds and then it's just gone off in various different directions. So this company that you're involved in now was a spin out from the university. So tell us a bit more about the story behind that. You've mentioned it a little bit.

Nanik Ramchandani:

Yes. So in, in 2023 Zakwan was working on creating a better digital asset custody solution. So essentially in crypto assets, if you lose your private key, you lose your assets. So he wanted to make a better custody solution and he had made some good strides in that in that direction. But it was a really hard problem to commercialise and also, we realised that it wasn't something that really excited us, like we didn't wake up any morning wanting to protect crypto assets. And that we had applied for grants, so we got the high growth spin out opportunity qualification for that, where we explored multiple use cases. And one of the things you'll often hear in the university is that we have a solution, but we are looking for a problem. Which is the reverse of how typically a startup should be done. But it is a challenge which is not insurmountable. It just requires a lot more thinking about what problem is it that our technology can solve well versus just any technology solving. And that kind of led to this passion to stop fraud. Around the same time in 23, my mother was scammed and I saw what it did to her. So it was one of those things where just came together that this is a problem we want to solve and this is a problem we can see ourselves doing for the next 20 years. And that project went on within the university to raise almost a half a million pounds in different grants and now has spun out as of 77 days ago, as I probably mentioned. And we are now out to hopefully get our product launched in the next 60 to 90 days.

Sarah McLusky:

Fantastic. What a great story. And yeah, it'll be interesting to see how that develops. So is this your first experience of spinning out a company from actually from a university rather than a company that was already running or doing it just completely independently? And how has that process been? Has it been different?

Nanik Ramchandani:

Oh yeah that we, how many, how much time do we have? Another five hours. Yeah, it is the first one, which I've actually spun out. I was involved in the previous project as well, which was the one that I mentioned between 2021 and 2023, that hasn't spun out yet, but should spin out soon. They had some other technical and financial challenges to, to surmount but the spin out process is definitely not an easy one. I think it's getting better. Napier has done a lot of spin outs before in the cybersecurity space, so they've got history in doing it. But it's still fairly clunky in terms of the negotiation process, which happens like 24 months too late, to be honest. It should be very clear at the beginning of what it involves and so on. Even the whole legal documentation process, it just feels like it's just far too onerous for this stage it is at. If you look at startups in the US, they, there's a typical YC document template, which is a five pager for safe notes, which is how every startup literally starts in the US. It's so easy. Everybody knows it. It's a quick sign and you're done. So university spin outs are harder. I think I lost about half my hair and the rest became gray through that three month process of actually looking through about 200 pages of legal docs.

Sarah McLusky:

Goodness.

Nanik Ramchandani:

I would, I, I think that can be definitely made easier but yeah, it's not great, but I think it's getting better. Okay. I definitely believe it's getting better way.

Sarah McLusky:

Yeah. Oh, I hope so. So how has your partner in this business, how have they found this process? Is it what they expected? This whole perceptions versus reality idea.

Nanik Ramchandani:

Oh, that, yeah. I think perception versus reality is interesting because it's, I think there are two sides to it. One is as a business, what it takes to start up a business. And then what it takes to spin out. So there are two different things I look at it. I think from my, in this particular case, ro my co-founder's perspective, what really worked well with us is that we trusted each other for our domains. And this is one of the things like when I look at, I do some angel investing on the side or whatever. When I look at people who, who I would invest in would be people who are very self-aware. They know what they're good at, and then they know what that person brings to the table and they then leave each other to it. It's, there's no sense at that stage to try and do it. So I don't think basically my co-founder didn't necessarily spend much time on the legal documentation, all the stuff at all. He left that to me and I left him to focus on the deck. So the spin out process probably wasn't as harrowing for him. But in terms of, I think when it comes to how easy or difficult is it as, and what it takes to do a business in a startup, most people don't really know until they get into it. And this, it's, I think one of the biggest misconceptions is it's really easy to make money in a startup. So I think the worst way to make money is set up a startup. Like you can do so much better if you are a PhD or and qualified to get a job, which gives you those holidays and the options or whatever on the pension. Versus a startup where 95% probabilities will fail after eight years and after a hundred hour weeks and so on. And I think it helps if you've been around the block to realize that it's not it's not easy. And the only reason, therefore you do a startup is because you love the problem that you're trying to solve. Otherwise, it's very hard to survive a startup, to be honest. So yeah, I dunno if I answered that.

Sarah McLusky:

Yeah. So you're painting a picture of a really challenging process there. Sounds like it's something that's not for the faint-hearted, but that's where I guess specialists, experts, people like you who've been through it before, are incredibly valuable.

Nanik Ramchandani:

Yeah, I think it definitely helps. I, there's a lot in Scotland. Scotland's a great ecosystem, and I've lived in like more than 10 places across the world. So whether it's East Coast US or Singapore, Dubai or Geneva or whatever, like I've worked and lived in multiple parts of the world and I think the Scottish ecosystem is incredible for getting you off the ground, especially if you are within the university. But what happens is that it's not necessarily great in terms of giving your real reality check on how hard it is. Yeah, and so the way I like to put it is, in the financial world there's this thing that dentists make the worst investors, right? Because they're really good at something and it's very straightforward what they do every day. And over a period of time, you start thinking that you can do everything really well. So the reason like you in the financial world is like when dentists start day trading, it's a disaster. They lose everything. It's one of those things. So in similarly in the academic world, you're essentially, you're really good at something you've spent a lot of time focusing on, and you're really good at it. Like you're either world reknowned you've written papers, you can talk about it endlessly, but that doesn't necessarily translate into everything else in life, right? And this is what happens sometimes where the realities of a business are completely different. Which is where the self-awareness is so important that like realizing that it's you are good at something doesn't mean that you can actually run a business and a three week program on teaching you how it's not going to make you an expert either. And so it's a, I don't, I, I'm not saying that academics can be fantastic CEOs. They can, and like Jamie Graves is an incredible example. He built a company called Zone Fox, spun out of Napier, sold it after 10 years to a multi-billion dollar business. But, and he went through that 10 years to be the great CEO that he was. But it takes that time. That's what I mean. Yeah. It's it's almost saying that, okay, you've been to business school for two years and I can learn the same thing in two weeks. It doesn't work.

Sarah McLusky:

Yeah. No, it makes absolute sense and why you need those experts and things around you. And so if that support that perhaps is out there isn't maybe hitting the spot, what else do you think might be needed to help these people who are interested in developing companies from universities?

Nanik Ramchandani:

So I think that the support is, yes, it's not there as, I think there are lots of universities complain that they can't find really good commercial champions. And a part of it is a function of how do you incentivize the commercial champion because the commercial champion comes in on day one. There's no visibility on any upside on this project. So it's purely, a payment for number of days worked. So the question is, and which is typically subsidized to real market rates, and then it's typically two days a week maximum for the project. Now the commercial champion has, can't leave a full-time job to work two days on something they have to be doing, either be a entrepreneur on their own and doing be doing something else three days a week or trying to fit that with another project. And as anybody in the startup world would know, once you are in a startup, it's a, you can't do anything else, you, it is a full-time like intense job. I would say even just fundraising is a full-time job now. Forget the startup as a full-time job. So I think incentivizing the people correctly and having is extremely important. The second thing, and it's just that ecosystem buildup process where we have great programs on training. We have fairly good initial set of mentors. What could really help is getting the first customer for example. Like one of the things that most startups struggle with is it's great building in the lab and having a TRL five or six, but actually taking something to production is a whole different ball game and getting a first customer is a huge challenge. If the ecosystem helps you get that first customer, and this is where Scottish government, Scottish enterprise, all the organizations can help, it would be a game changer in, in my view for example, just give you illustration. So we wanted to do a pilot while we were within the university, and it took so many months of back and forth with the insurer of the university to figure out how we would contract with this pilot customer. We couldn't do it in the end, right? So you have classic challenge. To raise money, you need traction. But to have traction, you have to do something like sign a contract, which is, but to sign a contract. You have to actually be outside the university because today I can sign a contract in, one day. Yeah, all I need to do. But within the university, six months later, I couldn't sign the contract because it was just so complicated, yeah. Because who's taking responsibility? Where does the liability lie? And so on. So it's almost like getting that first customer is such a challenge and. I have tons of ideas on how we can make it easier, but we don't have time for that. Yeah. But like that could be a game changer. Yeah. In like how we, these spinoffs really get that acceleration. Yes. Which is so important because only advantage as a startup is velocity, within the university, like I think most businesses work at human years. Large organizations, startups need to work in dog years. You need to do things seven times faster. But universities work in snail years, right?

Sarah McLusky:

Yeah. They're the definitely the other end of the scale.

Nanik Ramchandani:

Yeah. So within the university it's even though there's so many people who are supporting you, it's just not possible. The systems don't allow it to do things at the pace that you need to. And what often happens is it's too late, the market has moved, the technology has moved, and so on. So you can't capitalize on the original opportunity.

Sarah McLusky:

Yeah. And that must be particularly challenging in a very fast moving environment like digital technologies. Yeah.

Nanik Ramchandani:

Yeah, a hundred percent.

Sarah McLusky:

Yeah. I think another thing that you've mentioned a little bit as we've gone through is yes, there's the support, the tangible, the practical stuff, but then also the finance, getting the finance behind startup companies as well. And it sounds like that's something you've been very successful at doing for the businesses that you're working with. Are there any kind of secrets to that or. Is it all about the technology, the product?

Nanik Ramchandani:

I think there, the one is of course, like I said, fundraising is a full-time job. So having a commercial champion who gets numbers, who understands that is, it really helps. So I've spent most of my life in finance. And I, most of my job during the, within the university was looking at every grant application I could find. And, connect with the right people and so on. So both these startups that I was like projects, I would say within the university, I working for managed to raise over half a million in non-dilutive funding. And this was like, it's huge because most nobody else in the university has done that. While in the project within the university, of course the ecosystems also become better and there's more money. But ah for example, the one that we've spun out now, we got another 350,000 in Innovate UK SMART Grant, which we only 2.5% get it in the UK. And it wasn't an easy process. Like we worked really hard with first time we got rejected, we were below the cutoff of 86%, we got 81. The second time, we got 88 or whatever, and we passed it. It took a lot of work. And I guess we talked through that. Listen, we need some funding on day one and we got that 350, so we managed to get another 350 to get it. So we have now one year's money or one 15 months money to spin out because the challenge on spin out is this classic thing that you need now you've out of the university you need money to get going, but you don't have traction yet. You Yeah. You couldn't do sales while you're within the university. And so this is the classic problem, like how do you now raise money? Usually you'll be drip fed in the unfortunately, in the Scottish ecosystem, you'll get say 250 or 100 or so. Now that can't pay for more than two people, right? So if you wanna build a business, you need that one million, one and a half million. How, it's a chicken and egg. How do you get the one and a half without showing some level of traction? There it becomes much it becomes really challenging. One thing is of course we have, oh, it's a much nascent ecosystem for fundraising here in Scotland. In the US completely different ball game. I just spent over five weeks in the Silicon Valley and there, it's such a different world in terms of raising. You have to be embedded in the system to raise it, but you can raise based on a really good concept with the right networks and versus here where not only do you need the traction, you need a tenure business plan and like a whole bunch of other stuff and so on, five patents and so on. So it is much more challenging in terms of fundraising. But like I said, I think the answer is just, a lot more dedicated work. And looking beyond just Scotland to raise. Those are the important things, which is what we are trying to do. Our first race is likely to be in the US.

Sarah McLusky:

Yeah,

Nanik Ramchandani:

And not Scotland, unfortunately.

Sarah McLusky:

Yeah. Oh, well It'll be interesting to see how your company develops and whether that might be an interesting model for other people to learn whether there might be any particular lessons there, which are gonna be useful going forward. So you've got this company, now that you're spinning out, are you still involved with doing other projects at Napier University?

Nanik Ramchandani:

So I was still till end of May, I was still doing one day a week. Supporting the Centre of Excellence In Digital Trust, which I helped get together with Bill. But the reality of startup is there is I just don't have time. Yeah. To do anything else.

Sarah McLusky:

I can imagine,

Nanik Ramchandani:

Like I said, Monday morning I'm already looking at my to-do list for the week and I'm like, there's no way I can finish it this week. Yeah, fortunately and unfortunately, I think one of the things which I probably directed earlier is, anything which is one day or two days which a lot of commercial champion or other things are. Don't end up being one or two days. They always stretch and it's really hard. I find it really hard to manage the time. Some people are really good. They'll say, Fridays, I just do this. Yeah. I find it really hard. If I see an email, I just want to respond now, I can't wait till Friday kind of thing. So I, I gave that up because now I'm a hundred percent on this because this is it. This is my passion. This is, what I'll be breathing and living for the next whenever till we survive, hopefully we will, so yeah.

Sarah McLusky:

Yeah I think that's probably a good place to wrap up our conversation then. So I really look forward to seeing how this develops and where it ends up going. And good luck with that to-do list. If people want to find out more about you, the work that you do, whereabouts would be a good place to go and look?

Nanik Ramchandani:

LinkedIn is the go-to resource for anybody, so that I'm fairly easy to find on LinkedIn. I'm pretty good in connecting if people write me that 300 character on, on, like why? Because otherwise it becomes too much. And but I think that's, and our website is lastingasset.com, lastingasset.us. We are going to be launching a new brand perhaps in the next 60, 90 days. Which is still in stealth mode, but it would be all over LinkedIn when it does come out. So yeah, LinkedIn is the best way. I'm also always happy to support young startup founders, entrepreneurs. I've been over the last couple of years we, at Lasting Asset, we won the People's Choice Award and we're the finalist at Santander X, which was, we made it to the top 12 out of 1,560. We won the Futures Tech Award from Cisco at Converge in 23. We've been around the block as far as pitching goes and just so if I can help, I love to help young startup entrepreneurs in any way I can. So if it anything I can do, which doesn't take up a full day I'll give very, I just like, I don't charge for any of that. So like I, I'm happy to support the ecosystem.

Sarah McLusky:

Yeah.

Nanik Ramchandani:

And so anyone reach out, please feel free to,

Sarah McLusky:

That's a fantastic offer and I'm sure some people will take you up on it. So thank you so much for taking the time to come along and tell us about the work that you do.

Nanik Ramchandani:

Pleasure, Sarah. Thank you so much. It was great chatting with you.

Sarah McLusky:

If you've been inspired by this podcast, head over to our LinkedIn page and tell us about your biggest takeaways. You'll find a link in the show notes or just search for the Academic Adventures Podcast. This podcast is a collaboration between the University of the West of Scotland, converge and Sarah McLusky, working in partnership with Ross Tuffee and the Connect-Ed Network. The podcast team includes Orla Kelly, Adam Koka, Jen Black, and me, Sarah McLusky. This season of the Academic Adventures Podcast is supported by the Scottish Funding Council.