Why do university spinouts remain undercapitalised?

Lizzie Young from Par Equity helps Sheryl Moore answer a tricky exam question

Hello Rainmakers,

Today we’re shining a (Northern) light on that core question that has dogged economic development and investment worlds for years.

Lizzie Young has set the university sector a challenge. Armed with a PhD in medical engineering, Dr Elizabeth Young (to give her the full title) is not your usual run-of-the-mill venture capitalist.

However, as an investment manager at Par Equity in Leeds, Sheryl Moore discovers why she’s determined to secure funding for the region’s university spinouts and drive forward investment into Yorkshire’s emerging clusters.

There may be a robust talent pool, but university spinouts remain undercapitalised.

Yorkshire’s universities have the potential to transform the region’s economic landscape and catapult the region into a national leader in innovation-driven growth.

It’s a bold statement but a report by early stage, technology-driven venture capital firm, Par Equity, suggests that by commercialising the universities’ cutting-edge research into high-growth, spin-out companies, Yorkshire will become a centre of technological excellence that will rival anywhere in the UK.

The Northern Lights report revealed that research talent at the region’s universities is producing world leading innovation, addressing global challenges in healthcare, the environment and beyond.

Yorkshire is also witnessing the emergence of powerful technology clusters in sectors such as AI, precision medicine, big data, and clean technologies. Sheffield has established itself as a powerhouse in advanced manufacturing, quantum computing, robotics and cybersecurity. Leeds is making significant strides in healthcare operations, diagnostics, and data analytics - with tech giants like Microsoft recognising the city’s talent pool by establishing a local presence.