'University equity share has a limited effect on multiple spinout fundraising factors' - Saïd Business School

A study containing statistical analysis of 650 UK spinouts between 2010 and 2021, released by the Saïd Business School at the University of Oxford, shows that the university proportion of equity share has a limited effect on a number fundraising factors.

These factors include the probability of spinouts raising equity, the amount of funding raised, and the market valuation of a spinout after it has received funding.

The paper's lead author is DP World Professor of Entrepreneurship and Innovation at the Oxford Saïd Business School Thomas Hellmann. He said:  ‘'This often-heated debate about a university’s stake in their spinouts happens in a data vacuum, based on opinion and anecdote.

''We are addressing this gap by analysing systematic data on the relationship between university stakes and subsequent fundraising outcomes. The results speak for themselves, there are some specific effects but the broad-brush argument, that higher university stakes make spinouts unfundable, is not supported in the data.’'

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The study highlights a few things, firstly that the average UK University's equity share in a spinout is 31 per cent and declining - the University of Oxford averages a 20 per cent equity share.

Secondly, analysis shows that that less than five per cent of university spinouts in the UK ever raise more than £25 million. The University of Oxford has said that this figure suggests that ''the debate should focus less on equity share and more on creating more attractive investment opportunities for UK spin outs to scale up exponentially''.

Pro-Vice-Chancellor for Innovation at the University of Oxford Professor Chas Bountra said: '‘Oxford remains at the forefront of the UK’s university innovation economy thanks to our researchers and the commercialisation potential of their work.

''We continue to contribute to the UK’s innovation economy by reinvesting our university returns into funding further research innovation and by aligning our commercialisation approaches with our founders and partners in industry, the investment community, government, and the wider ecosystem.''

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