It’s never been done before, anywhere in the world.
HESA’s experimental data (collected via part C of the HE-BCI questionnaire) shows 2,269 companies founded or owned by UK higher education providers, stretching as far back as 1969 (excluding 22 operating in “stealth mode” for reasons of commercial confidentiality.
It puts names and numbers on the phenomenon of the higher education provider spin-out – demonstrating a direct impact of research, development, and incubation activity.
A starting point
In itself, it is simply a list of company names, linked to provider names and showing foundation and incorporation dates (the former is the year when intellectual property was transferred to the spin-out, the later is the year it was registered with an appropriate authority like Companies House). It includes all spin-outs active during the 2023-24 academic year, plus spin-outs of any status since 1 August 2012. It will become more useful as more data is added year-by-year, and it is very much promoted as a starting point for data linking and further analysis. But even now, we can see the growth in numbers over time, and the way new spin-out numbers have declined since 2021.
With this in mind, we’ve linked via company registration number to the main Companies House free data source. The majority of companies are registered here – you can generally read an absence of registration as an indication that a company is no longer active, but there are also some edge cases..
Companies House data isn’t brilliant quality, but it allows us to unlock some additional information about each one. We can see an indication of status (confirmation that a spin-out is active, or details of what else – liquidation, administration – may be going on. We get an indication of the location of the spin-out, and the company type (is it a limited company?).
What are they up to?
Of particular interest to us was the activity of the company in terms of the industry it is involved in. Companies House uses Standard Industrial Classification (SIC) codes – on registration and annual confirmation you can supply up to a total of four. Again I should emphasise that the quality of data isn’t fantastic, but this does give you a sense of what all of these spinouts may be up to.
By far the largest sphere of activity is biotechnology development, with the catch all “other research and development on natural sciences and engineering” in second place.
Five providers have more than 100 spin-outs registered – Cambridge, Oxford, UCL, Swansea, and Manchester (Imperial is at 97). It would perhaps be more surprising to many to see 72 spin outs from the Royal College of Art – these are not limited to arts-related activity although the majority will be design-led.
In total
DK has put together a master search, allowing you to view salient details of every spin-out on the register. Choose a provider of interest with the filter on the top, or narrow down by company activity using the free text (you can enter up to five terms, and it is a little bit experimental so it may not always produce the results you would expect – but do persist) box at the bottom – and he’s also added a filter for social enterprises.
What have we learned?
Policy watchers may be interested in whether the spin-out ecosystem is getting stronger, or looking healthy, or as many in the sector would say that spinning-out is fine but spinning-up is really difficult.
Again, it’s hard to know without more data. Of the 2,269 companies on the register 526 are not currently registered with companies house, 67 are in liquidation, 30 have a “proposal to strike off”, and 8 are in administration. Another way to look at this of course is that 1,646 university spin-out companies stretching as far back as 1969 are, at least on paper, alive and well. This is in stark contrast to businesses more generally where only one-third of businesses started ten years ago are still in existence.
Another interesting question is whether various interventions, reviews, templates on equity, or missives from the government have made developing spin-outs any easier or more lucrative. Again, at the risk of sounding like a broken record, the register is not the right place to look for this information. It is tempting to say that as university finances came under real strain from 2021 onwards spin-out creation velocity declined. Clearly, universities need cash to invest in spin-outs and when they have less cash it would seem likely there would be fewer spin-outs. However, we just don’t have enough information in this register to suggest with confidence why the spin-out ecosystem looks like it does, even if we can describe what is happening.
