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Mishcon Highlights Governance as Key to Scaling Sustainable Innovation
- Daisy Moll
- 18 hours ago
- 3 min read
Legal and investment experts have urged investors to look beyond innovation, focusing instead on internal governance to identify startups primed to scale.
Speaking at last week’s Sustainable Times event, Nicola McConville and Attilio Leccisotti, Partners in the corporate department of leading law firm Michcon de Reya, discussed how founders can prepare their businesses for investment and long-term growth and how investors can successfully scrutinise the companies doing so.
On 1 October, the Sustainable Startup Investment Summit gathered a community of sustainability-minded founders and investors for an inspiring evening of startup pitches and thought-provoking industry panels.
McConville, who has advised on hundreds of seed-to-exit funding rounds, said investors increasingly reward companies that demonstrate “structural maturity” with clarity on ownership, governance, and intellectual property.
“It’s important that founders lay the right foundations early on,” she explained. Mishcon runs a programme, delivered in collaboration with universities and accelerators, which supports entrepreneurs in understanding director duties, managing cap tables, and running effective boards.
“Red flags”
According to McConville, “red flags” that investors should look out for include weak or non-existent intellectual property ownership, unclear shareholding structures, and over-reliance on founders’ expertise without bringing in specialist support.
McConville noted that misunderstandings around cap tables are still far too common. A company’s cap table is a document or spreadsheet that details who owns what within the business. It lists all shareholders, how much of the company each one owns, and includes information on share options and any outstanding company debt.
“It’s not just about the fully diluted column,” she said. “Investors care about who owns what today, as this impacts Enterprise Investment Scheme qualification and employee incentive schemes.” A messy cap table can complicate fundraising by confusing investors and creating potential legal or operational issues down the line. It can also result in disputes, financial losses, and slower decision-making that can hinder growth, McConville warned.
Strong intellectual property is particularly critical for early-stage and university spinout companies, where it often underpins the entire business model, she added Patents, trademarks, copyrights, and trade secrets give founders a legally recognised claim over their innovation and can represent their most valuable asset. Without clear IP ownership, competitors can easily replicate a product or technology, eroding competitive advantage before the business has a chance to scale.
Defence opportunities
In assessing areas of growth, Leccisotti identified deep tech, quantum computing, and dual-use innovation as leading investment frontiers. McConville’s recent appointment as Chair of a University of Leicester nuclear energy spinout underlined the increasing alignment between energy security and sustainability priorities. “Where once founders distanced themselves from defence-related technologies,” she noted, “they now recognise these sectors as critical to achieving sustainable innovation.”
Global consulting firm McKinsey estimates that modernising defence systems around AI, quantum, autonomous platforms, and cyber capabilities presents a $250 billion opportunity not just for incumbents, but for startups able to bridge commercial and security domains.
Leccisotti, who specialises in bringing institutional investment to university spinouts, highlighted the need to close communication gaps between innovators and investors. “Academics and inventors often have brilliant ideas, but translating that into investor language is a skill,” he said. “We help them understand what institutional investors expect from compliance to culture.”
UK Research and Innovation, a governmental department that directs research and innovation funding, released a SpinOut Register earlier this year highlighting the role that universities are playing in delivering new innovation. There are currently over 2,000 university spinouts in the UK, the vast majority of which (89%) “emerged from engineering and physical sciences and life science disciplines”.
Leccisotti highlighted that investors are prioritising governance, resilience and dual-use potential alongside breakthrough technology. As early-stage capital becomes more selective, founders who combine technical excellence with structural discipline will be well positioned for scale, he said.
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