Busting myths and moving forward: the reality of UK university approaches to taking equity in spinouts

Abstract

This report presents new evidence on how UK universities approach taking equity in spinout companies. Based on a survey of 24 university technology transfer offices, it examines typical founding equity levels, how deals are structured, and the wider terms influencing spinout formation. The report finds that most universities apply differentiated, context-specific equity models, and that founding equity is often diluted pre-investment to accommodate CEOs, employees, and funder obligations. It also documents the extensive non-monetary and financial support universities provide. The analysis includes a detailed examination of the spinout journey, revealing it as a complex process involving multiple individuals and organisations with competing motivations and obligations. The report concludes by calling for policy debates to move beyond equity levels and address lifecycle and system-wide factors affecting spinout success.