Martin Polonyi (G-Force), Rory Taylor (G-Force)

Reviewed by: Tamer Abu-Alam (UiT)

Executive summary

This white paper, developed within the SEEDplus project (GA 101100494), explores the strategic, legal, economic, and technical considerations involved in establishing university-owned or affiliated venture capital (VC) funds. With the aim of strengthening the role of universities in their local and regional innovation ecosystems, the paper serves as a practical guide for higher education institutions (HEIs) seeking to commercialize research, foster entrepreneurial success, and build a more sustainable pipeline of spinouts and startups.

University venture capital funds are increasingly used as tools to accelerate the commercialization of university-based research and support student entrepreneurship. Over 200 university-affiliated VC funds operate globally, with the UK leading in proportional adoption among top-tier universities, the EU rapidly catching up—especially via multi-institutional models—and the US maintaining a deep but externally driven VC market, with the relatively lower proportion of university proprietary VC funds balanced out by the greater maturity and scale of its broader VC market. Despite variation in fund structures and regional approaches, all models seek to address a similar challenge: bridging the gap between early-stage innovation and market-ready ventures.

The white paper outlines the full landscape of mechanisms available to universities for supporting the transfer and deployment of intellectual property (IP), from licensing and equity participation to repayable grants and venture debt facilitation. A university VC fund stands out as a catalytic mechanism—able to provide not only patient capital, but also long-term strategic alignment with the university’s innovation agenda.

Establishing such a fund, however, involves navigating complex legal and regulatory frameworks, securing sustainable funding sources, designing appropriate fund governance and management models, and integrating investment activity with broader university support services such as incubators, accelerators, and alumni networks. The paper highlights key feasibility factors, including:

• Legal feasibility: Regulatory and state aid compliance, public procurement procedures for selecting fund managers.
• Economic feasibility: Fundraising strategies, incentive alignment, fee structures, and return expectations.
• Technical feasibility: Investment focus, deal sourcing, fund governance, and alignment with the university’s tech transfer infrastructure.

Global case studies and examples, from Oxford Science Enterprises and Cambridge Innovation Capital to UVC Partners and Stanford’s StartX, illustrate a diversity of approaches in fund design, spinout support, and ecosystem integration. The paper distils these insights into actionable recommendations for universities considering their own venture capital vehicle, including implementation roadmaps, stakeholder alignment strategies, and metrics for long-term success. Additionally, within the context of this SEEDplus project, this white paper was developed alongside three feasibility studies exploring the possibility of establishing university VC funds within three HEI partner ecosystems, UiT – the Arctic University of Norway, Technical University of Varna, and Kyiv Academic University. This white paper leverages insights and practical examples from these studies.

This white paper is designed to support HEIs in making informed decisions about whether and how to establish a venture capital fund. It provides a foundation for institutional leaders and policymakers to evaluate this increasingly popular mechanism for deepening the impact of university research and driving innovation-led regional development.