University spin-outs: Turning research into companies that last

UK universities are renowned for excellent research and discovery, yet they remain less effective at translating that into companies that grow, create employment and remain in the UK.

This gap matters. It represents the difference between a breakthrough that changes lives and a breakthrough that is ultimately commercialised elsewhere.

The Hickson Review: Why UK spin-outs stall before they scale

Tony Hickson, Chief Business Officer at Cancer Research UK, has conducted a review of Britain's research and innovation sector for UK Research and Innovation (UKRI).

The review identifies why spinouts so often stall. Too many deals take too long. Too many start with uncertainty over equity terms. Too much depends on which institution you happen to be dealing with. When the early stages feel slow or unpredictable, founders lose momentum and investors look for easier routes.

Equity is usually a sticking point. Universities want a fair return for the research and support they have provided. Founders need enough ownership to stay motivated. Investors need to see that risk and reward make sense. 

Practical steps to accelerate deal-making

This is not a moral argument. It’s a practical one.

If the starting position is unclear or unrealistic, everyone spends months negotiating from scratch and the company runs out of time.

There is a straightforward fix:

• Publish clear policies. 
• Use standard documents as a starting point wherever possible. 
• Set internal timelines and stick to them. 
• Start from a sensible market baseline, then adjust for the facts of the case.

A previous government spin-out review made similar points and pointed institutions towards USIT, the University Spin-out Investment Terms. USIT is not a rulebook. It’s a shared set of starting points on common issues like equity, IP licensing and investor protections, designed to reduce avoidable delay.

Bringing in the right people at the right time

Process is only half the story. People matter. 

Not every academic should be expected to run a business day-to-day. The strongest spinouts pair great research with experienced leadership, people who have done it before, understand the challenges and have the scars to prove it.

Bring in independent board support and engage early with real customers. That’s how you test demand, sharpen the offer and get to revenue sooner.

Making commercialisation central to research strategy

Commercialisation should sit at the heart of research strategy. If universities act on Hickson with clarity, pace and realism, more spinouts will become companies that last.

For founders, investors and institutions working through spinout formation, clarity on equity, process and governance from day one makes the difference between momentum and months of negotiation.