Lessons from the 2026 Spinout Landscape – What does it mean for Sheffield Innovation Spine?
The Royal Academy of Engineering’sSpotlight on Spinouts Report (June 2026), powered by Dealroom data, highlights a shift in the UK’s innovation economy and shines a light on Sheffield’s exciting spinout growth rate.
UK spinout activity is becoming increasingly geographically diverse, with strong growth beyond the Golden Triangle and an expanding number of universities generating significant value in regional innovation clusters. Specifically, the University of Sheffield is recognised in the report for its spinout growth, producing 22 VC-backed spinouts since 2010 – placing the University of Sheffield 9th in the UK for spinout value creation since 2010. The University was reported to have incorporated 24 companies since 2022, which places it 4th in the country for number of spinout launches.
Since 2010, UK University spinouts have generated over £49 billion in value, adding 27,000 jobs. Seventy percent of these jobs were created after 2020. Crucially, deep tech underpins 96% of this ecosystem's value, establishing spinouts as vital drivers for resolving complex economic challenges.
Amid this national momentum, the Spotlight Report notes that University of Sheffield spinouts have a combined enterprise value of £326.3M - seeding economic growth across South Yorkshire and more broadly across the North. With strengthening partnerships between northern universities, a strategic focus on the academic ecosystem, and targeted investor funding for spinout innovation businesses, the data highlights the exciting rate of change across the ‘Northern Arc’ — an economic supercluster connecting Sheffield, Leeds, Manchester and Liverpool.
The report shows the variability of support across UK universities for spinout founders and highlights university equity stakes as one of these measures. The University of Sheffield offers one of the UK's most founder-friendly spinout equity positions, with equity stakes broadly aligned with the post-USIT reforms highlighted in the report. Furthermore, the launch of the Northern Universities Venture Fund by Northern Gritstone and Parkwalk provides the crucial seed-to-scaleup funding necessary to fuel regional deep tech.
This data and analysis by the Royal Academy of Engineering is the latest signal of Sheffield city’s broader success and the onward economic growth opportunity. It validates the critical need for Sheffield Innovation Spine, the city’s dedicated urban innovation district in Sheffield city centre. While Sheffield's reputation for groundbreaking research remains world-class, and its energised rate of commercialisation and growth in spinout value creation is stronger than ever, the immediate challenge is anchoring these high-growth businesses locally - so that people in South Yorkshire benefit from the job opportunities, and the accompanying regeneration and animation of city centre neighbourhoods.
Beyond Sheffield’s spinouts, the region’s wider tech sector is gaining traction with South Yorkshire’s tech businesses sitting at £2.6bn worth of enterprise value, according to Dealroom data reported by TECH SY, the team scaling up South Yorkshire’s tech and digital economy on behalf of South Yorkshire Mayoral Combined Authority. Dealroom data identifies key sectors in Physical Tech, Energy and EdTech as thriving in the region. The platform also highlights the growth of several tech businesses raising investment including SiteHop, Bumper, Chalkie AI, and Fyous, with Iceotope being the first business to raise a Series B round since 2024. TECH SY's current programme, the FoundHERy, supporting female founders, has seen eight early-stage businesses from Sheffield join, with varied industry focus, including quantum, robotics, health tech and biotech.
By actively predicting and satisfying the space requirements of spinouts and investment-raising tech businesses, and by clustering knowledge-led businesses in a walkable, accessible and vibrant innovation district in Sheffield city centre, the Spine is setting the conditions for next-level scaleup and job creation. The Spine, a partnership between South Yorkshire Mayoral Combined Authority, Sheffield City Council, University of Sheffield, Sheffield Hallam University and Sheffield Technology Parks, is removing barriers to growth by convening partners around a shared economic mission, designing for density, connecting communities and shaping policy. The aim? For local people to stay near and go far.
Andy Hogben, Head of Commercialisation at the University of Sheffield, said: “We are seeing an incredible surge in Sheffield with more founders launching spinouts and investors backing them with serious capital. But spinouts are just one piece of our city’s growth story. True momentum is being driven by innovative founders across the entire city ecosystem. Sheffield Innovation Spine is vital because it isn't just for one group. The Spine connects people, ideas and research in the city to support companies and the local ecosystem to grow.”
Royal Academy of Engineering’s Senior Enterprise Manager, Dr Rachel Smith, said: “The Spotlight on Spinouts report confirms what many of us across Sheffield's innovation ecosystem are already seeing: the pace of commercialisation is accelerating. Sheffield's strong ranking for recent spinout creation reflects the depth of research talent here, but the real opportunity now is ensuring those companies can start, scale and stay in the city. By creating the right conditions for founders, investors and researchers to connect, Sheffield can play a leading role in the growth of the Northern Arc innovation economy.”
You can read the full Spotlight on Spinouts 2026 report from the Royal Academy of Engineering here, and you can learn more about Sheffield Innovation Spine, Sheffield’s energised urban innovation district, by taking a look around the rest of this site.