December 2024
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This conference discussed next steps for developing and commercialising university spin-outs in the UK.
It was a timely opportunity for stakeholders and policymakers to assess latest thinking and best practice for driving the sector forward. Those attending considered priorities for the Government following the recent publication of the industrial strategy Green Paper Invest 2035 and its commitment to implement recommendations from the Independent review of university spin-outs published in November 2023. Recent evidence shows 44 universities have adopted the recommendation to reduce the amount of equity received from software-related ventures to between 10% to 25%, with stakes of 10% or less in spin-outs with less intensive IP.
Discussion was expected to draw on UKRI’s work on implementing the review, including the benefits of sharing best practice developed from TenU’s USIT guide, with a plan for Research England to publish further information to help enable implementation of these practices. Sessions also examined plans in Invest 2035: The UK’s Modern Industrial Strategy, focusing on supporting the contribution that spin-outs make to the UK economy - with £1.66bn raised in equity funding in 2023 - as well as encouraging more venture capital investment into spin-outs and high-growth firms via pension and investment funds, such as the British Business Bank’s new British Growth Partnership.
With over £20bn of R&D funding, with £6.1bn supporting core research recently announced in the Budget, areas for discussion included strategies to foster collaboration, improve data and share tech transfer function, as well as looking at findings from Research England’s forthcoming one-year stock take.
We are pleased to have been able to include keynote sessions with: Dr Alison Campbell, CEO, Government Office for Technology Transfer; Alice Frost, Director of Knowledge Exchange, Research England; Prof Chas Bountra, Pro-Vice Chancellor, Innovation, University of Oxford; Simon Hepworth, Director, Enterprise, Imperial College London; and Fenella Boyle, SVP, Supply Chain Intelligence, Exiger; and former CEO and Co-Founder, Versed AI.
Delegates considered the way forward for developing spin-outs after creation and the relationship between universities and companies in commercialising their research, as well as examining industry imperatives for sustaining funding through the scale-up stage of development and in the longer-term. They also considered how the UK can increase the geographic spread of successful spin-outs domestically beyond the south east and remain competitive internationally, including approaches for attracting overseas investment.
With the £40m in proof-of-concept funding and improvements to support commercialisation of cutting-edge research announced in the Budget, sessions were expected to consider the Russell Group’s recommendations for the Government, such as piloting and scaling-up the UKRI’s proof of concept spin-out fund, launching a ‘spark fund’ to invest in early-stage university spin-outs, increasing Higher Education Innovation Fund allocations, and promoting the UK’s research-intensive universities internationally.
The agenda also brought out latest thinking on addressing the decline in equity investment in UK spin-outs from the pandemic-related peaks in 2021-2022. The role of university-partner funds in attracting investment will be discussed, alongside government policies such as visa schemes, and their effect on international recruitment and its wider growth agenda.
Overall, areas for discussion included:
- key priorities: progress since the Independent Review - moving policy and HE sector practice forward - growth efficiency in the context of the Government’s wider investment and spending plans
- spin-out creation: assessing efficiency and establishing a blueprint for licensing deals - approaches to IP - equity shares of 10% or less for spin-outs with limited new IP - support from the founding institution - strategies to accelerate the process, including training universities and prospective founders
- improving knowledge exchange: addressing UKRI’s work to implement a knowledge exchange strategy - the vision for a comprehensive database of UK spin-outs
- investment and scaling-up: addressing the fall in equity investment into spin-outs since pandemic-related peaks in 2021-2022 - the role of angel and venture funding - overcoming barriers academics face when pursuing commercial interests - priorities for attracting international investment - encouraging investment beyond the South East of England
- best practice: standards in the UK and internationally - developing investor-friendly value propositions - assembling strong start-up teams - securing patient capital - spin-out creation in research departments - forging best practice for investor relations and equity stake
- wider government priorities: examining the role of spin-outs in supporting the Government’s growth agenda - considering the impact of wider policies, including visa schemes and their effect on international recruitment - the effect of spin-out creation on the community and upskilling - maximising impact
All delegates were able to contribute to the output of the conference, which will be shared with parliamentary, ministerial, departmental and regulatory offices, and more widely. This includes the full proceedings and additional articles submitted by delegates. As well as key stakeholders, those that attended include officials from DSIT; DESNZ; DBT; DfE, NI; GO-Science; OLS; FCDO; GOTT; IPO; and The Scottish Government.
