IP Group PLC (LSE:IPO) CEO Greg Smith joined Steve Darling from Proactive to discuss new data showing that investment in UK university spinouts reached £1.56 billion in the first half of 2026, marking the second-highest half-year total recorded over the past decade.
The figures come from a new report produced by Parkwalk, IP Group’s EIS fund management operation, in partnership with analytics firm Beauhurst. The report highlights both the growing scale of investment into UK university spinouts and a shift in where that capital is being deployed, with funding increasingly concentrated among more established companies.
IP Group and Parkwalk remained among the most active investors in the UK spinout ecosystem, participating in 42 deals during the year to the first half of 2026. Over the past decade, the two organizations have invested in 98 later-stage deals involving UK spinouts, more than twice the number recorded by the next most active investor.
While overall investment remained strong, the data also revealed a significant decline in first-time equity investment. Funding for companies raising their first equity round fell to £47.0 million in the first half of 2026, down from £148 million in the same period of 2025, representing a 68.3% decline.
The number of first-time deals also fell, with 44 transactions recorded in the first half of 2026 compared with a peak of 73 in 2021. At the same time, the average deal size has more than doubled over the past decade, increasing from £3.57 million to £7.24 million.
Together, the trends suggest that while substantial amounts of capital continue to flow into the UK university spinout ecosystem, a greater proportion is being directed toward companies that have already established themselves, while fewer early-stage businesses are securing their first institutional equity funding.
Smith said the scale of capital now being raised by British spinouts demonstrates the international significance of the country's university science and technology ecosystem. He also highlighted the role international investors are playing in providing growth capital to UK companies.
According to the report, investment rounds involving at least one international investor accounted for 86.1% of total spinout investment during the first half of 2026, the highest proportion recorded during the decade.
International participation has also been significant in later-stage financing. Since 2016, international investors have participated in 82.6% of all later-stage investment in UK spinouts, underscoring the importance of overseas capital to companies progressing beyond their initial development phases.
At the same time, UK investors remain a major source of deal activity. They have participated in 2,546 spinout deals since 2016, more than six times the number involving US investors.
Smith said the challenge is increasingly focused on ensuring that successful UK university innovations have access to sufficient domestic capital as they move from early-stage development into commercial scale-up.
He pointed to the substantial assets managed by UK pension funds and argued that a greater allocation toward promising science-based businesses could help more companies scale domestically and retain a larger share of the economic value created by British universities.
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