- 53% of UK spinouts come from just 10 academic institutions, with Oxford University coming out top and Cambridge University experiencing the largest growth of 17% year-on-year.
- Accompanying this year’s report is a companion document, UK spinouts – a status update, which tracks the implementation of the recommendations outlined in the Independent Review of Spinout Companies.
The Royal Academy of Engineering today publishes the fifth edition of its annual Spotlight on Spinouts report, which this year shows a reduction in equity stakes taken by educational institutions in associated spinout companies.
In 2024 the average university equity stake was 16%, down sharply from 22% in 2023. Lower university equity stakes have been identified as key to incentivising exceptional academic founders to launch and scale their spinout companies, and this change is part of broader progress that has been made against a number of areas identified for improvement in the Independent Review of University Spin-out Companies (2023).
The report’s companion paper UK spinouts – a status update shows that over 50 universities are aligning with best practice, but varied practices are still in place. The Academy recommends that a more equitable distribution of equity between key contributors, including the university, senior faculty and spinout leadership, is needed to grow commercial success.
Capital investment and local network effects
2024 saw UK university spinouts securing over £2.6bn in funding, 38% more than in 2023. This compares favourably with the wider equity market for high-growth companies, which faced a near 19% decline in the same period.
Today’s report reflects a similar trend to the Academy’s recent State of UK Deep Tech report, whereby the number of deals has fallen but the overall amount secured has held up, pointing to investor caution coupled with an increase in the average value of individual deals.
London has the highest regional concentration of the UK’s spinouts, hosting 19% (384) of the spinout population. Its status as a leading financial hub and access to funding networks continues make it an attractive spinout base. The South East follows with 16% (321 spinouts), then Scotland with 12% (243 spinouts), and the East of England with 11% (218 spinouts).
Parkwalk Advisors remains the top investor by value and number of deals, and most of the top five investors (in number of equity deals), tend to prioritise funding for spinouts in their region: notably Scottish Enterprise, Cambridge Enterprise and Oxford Science Enterprises.
Emerging tech and established industries
Life sciences remain a strong sector for the UK, with a world-class research base fuelling commercialisation. Some 399 life science spinouts have been created as of January 2025, concentrated in the ‘Golden Triangle’. In the pharmaceutical sector for instance, the University of Oxford created 53 companies, the University of Cambridge, 38 and University College London, 31 spinouts.
Data provision and analysis ranks second as a sector – this is the leading spinout area for Manchester University – and electronics hardware ranks third. Artificial Intelligence remains dominant in the emerging tech sector, followed by cloud-based software and CleanTech.
As highlighted in the government’s Invest 2035 Industrial Strategy both established and emerging tech industries like life sciences, AI and quantum computing are seen as drivers of economic growth, key technologies and of strategic importance.
Founders and leadership teams
The report finds that over 76% of active spinouts have all-male founding teams, with 17% male and female founding teams and 7% solely female founders. Compared to 2024, there was 16% male and female founding teams and 8.6% all-female founders.
More gender diversity is seen at director level with male and female teams of spinout directors at 43% and all-male directors at 54%. In 2024 that figure was 52% for all-male directors and 45% for male and female teams of directors.
Efforts to increase gender diversity in spinouts are gaining some momentum and the report notes an initiative at the University of Oxford to boost the number of female founders. As of January 2025, 24% of Oxford spinouts have female founders.
Royal Academy of Engineering Enterprise Committee Chair, Paul Taylor CBE FREng says:
“It’s encouraging to note that average university equity stakes are now at a decade low of 16% and are moving towards the recent recommendations from the Independent Review of University Spinout Companies. This aligned with much of what we have long called for as an independent advisory body.”
“Tracking this progress will help us to understand how it will impact the founders we support, as well as how we will continue our independent contribution to the policy landscape. We hope our Entrepreneur’s Handbook will also help academics to navigate the spinout process.”
Ana Avaliani, Director of the Royal Academy of Engineering’s Enterprise Hub, says:
“Five years from our first report on spinouts we are proud of the impact we have achieved. Our data has sparked debate and been used by founders, investors, technology transfer leaders and policy makers to understand the bigger picture and make informed decisions.”
“We hope our analysis on spinouts continues to bolster support for this crucial sector to drive impact and economic growth across the country.”
Notes for editors
- The Enterprise Hub supports talented entrepreneurs and decision makers to transform breakthrough engineering innovations into disruptive spinouts, startups and scaleups. It was ranked number three in the UK and 14th in Europe in the Financial Times's Leading Startup Hubs in 2025.
- The Royal Academy of Engineering is harnessing the power of engineering to build a sustainable society and an inclusive economy that works for everyone. In collaboration with our Fellows and partners, we’re growing talent and developing skills for the future, driving innovation and building global partnerships, and influencing policy and engaging the public. Together we’re working to tackle the greatest challenges of our age.