University challenge

It has become an article of faith that converting the rich seam of innovations from the UK’s universities into successful business ventures is a must for a successful technology economy. That means tapping into the substantial pool of funding available from the City (second only in size to the US’s), whether as early stage venture capital or private equity investment to fuel business growth.

From the technologists’ point of view, the equation is simple: give us the money and we’ll deliver the goods. But the financial community has plenty of investment choices on the table, and university spin-outs are not always top of the list. It has long been recognised that the UK’s universities present a substantial source of potential businesses, but the path from research to start-up is not easy, transparent or as efficient as it could be.

This was confirmed by new research commissioned by the British Venture Capital Association (BVCA), which represents the vast proportion of UK-based private equity and venture capital firms (VCs). The report revealed an imbalance between university spinouts and their corporate counterparts.