UK SPIN-OUT SUCCESS, BUT LOWER AMOUNTS OF NEW INVESTMENT A CONCERN

Spin-out companies raised a record £1.30 billion equity investment in 2018, according to research undertaken by Beauhurst and the Royal Academy of Engineering.

The number of deals secured remained similar in 2019, but the amount invested decreased by 18 per cent. While the data for 2020 remains incomplete and the full impact of the Covid-19 pandemic on spin-out success and investment trends remains to be fully understood, the significantly increased average investment size could suggest a trend of more follow-on funding and less new investment.

According to the research, in a report published by the Royal Academy of Engineering in January, The University of Oxford produced the most spin-out companies since 2011, at 156, just beating the University of Cambridge at 140, with the University of Bristol coming in at number seven at 51 spin-out companies and the University of Warwick at number 11 with 38. From April 2020 to March 2021, Oxford University Innovation supported the creation of 37 companies.

Pharmaceutical, clinical and analytical sectors have the largest number of spin-out companies. Spin-outs are also commonly found in the software-as-aservice sector and materials sectors.