Almost half of the UK university spinouts founded between 2013 and 2024 came out of Oxford, Cambridge and London, and those three cities attracted two-thirds of the venture capital that went into the sector, according to a report published in February by Tony Hickson, whose career was based in university technology transfer, investment and startups.
Data compiled by Indeed for Bloomberg also show the so-called Golden Triangle accounted for more than half of the sector’s hiring.
More than 2,000 university spinouts have formed in the UK since 2010, with a combined value of about £49bn, most of them in deep tech, according to the Royal Academy of Engineering. Oxford Nanopore went public at a £3.4bn valuation, and Oxford Ionics and OrganOx were each acquired for more than $1bn last year.
Research outside the three cities
One company formed outside them is METzero, which spun out of Newcastle University in 2024 and has raised about £750,000 in grants. Its technology uses microbes and electrodes to break down sewage, using less energy than the century-old method of pumping oxygen through tanks and giving off ammonia that can be recovered and sold as fertiliser. Thames Water, the UK’s largest water company, is trialling it.
Pavlina Theodosiou, METzero’s chief executive, said support from Northern Accelerator, a government-funded programme founded in 2016 to help researchers commercialise their work, was vital. It paid for someone to develop the business plan, and a Royal Academy of Engineering fellowship bought her out of her university contract for a year.
Across the universities in Northern Accelerator’s umbrella, the number of spinouts rose from two in 2018 to 10 in 2025, against the 70-odd coming out of the Golden Triangle each year.
“The north east does not lack innovation or founders’ ambitions,” Theodosiou said. “It just lacks that same density of specialist capital.”
Listings moving abroad
Just 36 per cent of spinouts founded between 2013 and 2024 that went public did so in the UK, down from 79 per cent of those founded before 2013.
PsiQuantum, a quantum-computing spinout from the University of Bristol, moved to the US and was valued at $7bn in a fundraising round last year. Exscientia, an AI drug-discovery company from the University of Dundee, listed on the Nasdaq in 2021 before merging with the US biotech Recursion Pharmaceuticals three years later.
The main reason is the lack of scale-up capital. There is almost four times more private funding for startups in the US than the UK, and the gap widens to nine times for investments above £100m, according to the government’s Council for Science and Technology.
There is also a “persistent technical literacy gap” among British financiers, said Hickson, whose review was published by UK Research and Innovation. It is “most acute among later-stage investors, many of whom lack the scientific expertise needed to assess complex scale-up ventures.”
The government was reportedly considering an exit tax for university spinouts moving abroad, but quickly ruled out the idea, according to the Financial Times. Critics argued it would penalise successful businesses without fixing the underlying factors that push them abroad. The government said it wants the country “to be one of the best places in the world to start and scale a business,” but declined to comment on policy speculation.
Duncan Ivison, vice chancellor of the University of Manchester, said it is not always a bad thing when spinouts move abroad. “If we spin out a billion-pound company from Manchester and they set up in Silicon Valley or in San Francisco, I’m like hallelujah,” he said.
The number of UK spinouts has fallen from its pandemic peak, according to the Higher Education Statistics Agency. The average university stake fell to 16 per cent in 2024 from 28 per cent in 2017 following a government review, the Royal Academy of Engineering said.
Specialist university finance firms have also proliferated, among them Oxford Science Enterprises, which has raised over £800m, and Northern Gritstone, a cluster of universities in Manchester, Sheffield, Liverpool and Leeds.
After a pilot in Northumbria, Theodosiou is hoping to raise £1.5m by the end of the year to move METzero into its own premises. To get the funding, she is planning three trips to London this month. “That’s where the money is,” she said.
Amy Ingham
Amy Ingham is a reporter at Business Matters, covering UK business news with a focus on breaking news, business policy, late payments and insolvency. She joined the magazine in 2026 after completing the NCTJ Diploma in Journalism at Harlow College's journalism school. Her recent reporting includes British Steel's nationalisation and its impact on SME suppliers, the decline in late payments by large firms, and Insolvency Service director disqualifications. Reach her at aingham@cbmeg.co.uk.
