King's College London

King's College London has announced a major change to the way it structures spinout companies, increasing the equity stake available to academic founders.

Under the new policy, academic founders will now retain between 85% and 100% ownership of their spinout at formation, compared with the previous fixed rate of 80%. The university’s share will vary according to the type and intensity of intellectual property (IP) underpinning the venture.

The change balances a more transparent and founder-friendly approach to spinout formation and commercialisation with King’s active shareholding role, which ensures appropriate institutional oversight, consistency across ventures and a focus on long-term value creation.

The new policy adopts an IP-sensitive approach, with the university's equity position varying according to the type of technology being commercialised:

• 0% equity for social ventures, including impact-focused and not-for-profit organisations.

• 5% equity for non-patentable software and digital ventures, including software products, digital platforms and copyright-based innovations.

• 10% equity for patentable non-pharmaceutical technologies, such as engineering innovations, medical technologies, robotics and advanced materials.

• 15% equity for pharmaceutical technologies, including therapeutics, biotechnology and drug development.

The change reflects growing sector consensus on the importance of giving founders a larger stake in their companies and evolving best practice across leading innovation-focused universities.

The model aligns with recommendations made by the Government's Independent Review of University Spin-out Companies, which called for founder-friendly university equity stakes of between 10% and 25% for life sciences spinouts, alongside lower equity positions in sectors that are less dependent on university-owned IP.

It also follows guidance from TenU's USIT Guide for Software, which recommends university equity stakes of between 5% and 10% for software-based spinouts.

By introducing standardised equity ranges, King's aims to increase investor confidence and reduce the time spent negotiating spinout terms. This will allow researchers to focus on developing their companies and bringing new products and services to patients, customers and communities faster.

The announcement builds on King's wider commitment to innovation, entrepreneurship and commercialisation through its Strategy 2030, which places fostering innovation at the heart of the university's mission.

About King’s Innovation Catalyst

From early ideas to product launch, King’s supports ventures at all stages of growth with its world-class facilities, resources, funding and expert advice.

Researchers spinning out are supported by King's Innovation Catalyst, which provides tailored advice and guidance throughout the process, as well as funding to develop innovations.

The SPARK Innovation fund provides three levels of funding to early-stage exploration of innovation from the SHAPE faculties (Social Sciences, the Humanities, the Arts, People and the Economy). While the Innovation Development Award helps projects at Technology Readiness Level 4 to 7 to overcome pinch points in product development.

As ventures progress, researchers can draw on additional support from across King's entrepreneurial ecosystem. King’s Entrepreneurship Institute delivers the King’s Spinout Accelerator, while the London Institute for Healthcare Engineering hosts the King’s MedTech Accelerator and the MedTech Venture Builder, which advance the commercial and clinical translation of promising medical technologies into investment-ready ventures.

To learn more about the new equity stake framework, contact King’s Innovation Catalyst at innovation@kcl.ac.uk.