University College London Leads in Spin-Out Successes

By the Editorial Team · Sunday, August 9, 2026

University College London has emerged as a leader in the UK’s university spin-out sector by supporting innovative companies like Synthesia and Oriole Networks through targeted funding and entrepreneurial incentives. This success highlights UCL's ability to overcome nationwide declines in spin-out formations, which have been driven by reduced EU funding, government program limitations, and financial pressures on universities.

University College London (UCL) is emerging as a leader in the UK’s university spin-out sector, despite a nationwide decline in new company formations originating from higher education institutions. In the 2025-26 academic year, only 152 companies were spun out of UK universities—a five-year low and significantly down from a peak of 202 in 2020-21. While the broader sector faces challenges, UCL has distinguished itself by accounting for seven of the top 20 spin-out exits over the past decade.

The overall downturn in university spin-outs across the UK is attributed to several key factors. Since the end of the Brexit transition in December 2020, British universities have been excluded from funding programs previously available through the European Union, including the European Regional Development Fund (ERDF), which provided an average of £135 million annually between 2014 and 2020. The UK government introduced the UK Shared Prosperity Fund (UKSPF) in 2022 to replace EU funds, allocating £2.6 billion over three years. However, the fund’s flexible allocation—allowing local authorities to direct money toward a variety of projects such as town center improvements and general business support—has been criticized for lacking a focused approach to supporting university spin-outs in innovative sectors such as medicine.

In addition to funding challenges, universities themselves are grappling with financial pressures stemming from rising operational costs, staff wage inflation, and the freeze on tuition fees. These constraints have limited the availability of internal resources for investment in emerging technologies and business ventures.

UCL’s success contrasts sharply with these broader sectoral issues. The university offers targeted support for spin-out companies, including business training and guidance from early stages of student education, alongside incentives for academic staff to engage in entrepreneurship. UCL's two venture capital funds—the UCL Ventures commercialisation arm and the UCL Technology Fund—are a significant differentiator, enabling direct financial investment into spin-out companies, a facility few UK universities possess.

Notable examples include Synthesia, an artificial intelligence video company co-founded in 2017 by UCL professor Lourdes Agapito, which reached a valuation of $4 billion earlier this year. Staff members hold academic positions while participating in spin-out leadership roles, a structure that supports both research and commercialisation efforts. Anne Lane, chief executive of UCL Ventures, noted that granted patents bolster academic promotion prospects, further encouraging entrepreneurial activities.

Oriole Networks, founded in 2023, exemplifies the impact of UCL’s approach with an initial £250,000 investment from the university’s technology fund. The company develops technology to reduce the energy consumption of artificial intelligence systems by using light to interconnect computer chips. Having raised $35 million since its inception, Oriole Networks’ co-founder, Professor George Zervas, highlighted UCL’s direct engagement and funding opportunities as pivotal compared to his experiences at Bristol University.

Geographical disparities also influence the spin-out landscape. A British Business Bank report shows that equity-funded spin-outs are heavily concentrated in the South East of England, which also benefits from higher median deal sizes. In contrast, regions such as Wales and the North East lag behind, illustrating uneven growth opportunities across the country and underscoring the difficulty of achieving a uniform expansion of spin-out activity nationwide.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.