# UKRI's new plan sorts spinouts into two groups. Formation strategy depends on which one you are in.

**Faraz Rizvi × [Foundry](https://www.spinupforge.com/foundry/)**

*Faraz Rizvi is a UK operator-practitioner writing about the work between a research breakthrough and a fundable company. He runs SpinUp Forge, which provides spinouts with the hands-on operator resource and expertise to build the company around the science. [Foundry](https://www.spinupforge.com/foundry/) is SpinUp Forge's custom agentic harness.*

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![Isometric day scene over turquoise water — two identical peach towers on floating islands. The right tower stands high on a stacked plinth of record-slabs crowned by a single ember layer; the left tower sits low on one thin slab, a small founder figure in an ember dress and pale beanie standing before it.](figures/ukri-selection-gate/ukri-selection-gate-hero.png)

On 13 July 2026, UKRI published a delivery plan that does not announce new money for spinouts. It announces a new question: which spinouts are on the high-potential list — and what happens to the rest. For an academic planning to spinout, currently inside an Impact Acceleration Account or Proof of Concept cohort, that question has a direct operational answer, and it matters before November.

The plan formalises something that has been implicit in UKRI's commercialisation infrastructure for several years: not all funded spinouts will receive the same quality of active support. The mechanism is a tracking framework and a concierge-style account-management approach called Velocity, both targeted at a specific subset of the portfolio. The delivery plan names that subset explicitly. What it does not name is the formation strategy a founder outside that subset should now adopt.

## What the July plan actually commits to

*The tracking framework and Velocity are the same instrument seen from two different angles — identification and then intervention.*

The delivery plan is specific on both the target and the mechanism. UKRI commits to "identify and track high-potential spin-outs from existing and past translational investments, including UKRI Impact Acceleration Accounts and Proof of Concept" ([UKRI Delivery Plan 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/)). The tracking framework is timed to March 2027 ([UKRI Objectives and Key Results 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/)). For spinouts, the 2031 ambition is directional: increase the "total proportion of UKRI-funded spin-outs that secure private investment". For the wider live portfolio, it is numeric — more than 55% of businesses holding private equity or venture capital investment by 2031, through "a new account management approach tailored to individual business needs". A portfolio with a conversion target is a portfolio that gets managed. UKRI's chief executive put it plainly: "we will be more selective, doing fewer things, better" ([Ian Chapman, Wonkhe, 13 July 2026](https://wonkhe.com/blogs/ukris-new-strategy-is-here/)).

The support mechanism for designated companies is Velocity: "a tailored, concierge-style 'Velocity' approach to growth sector support, providing data-driven account management aligned to company maturity and accelerating commercialisation" ([UKRI Objectives and Key Results 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/)). Velocity is relatively new — Innovate UK announced it in March 2026 as "a new account management service" for high-potential businesses, running "from first engagement with Innovate UK through to capital raising and beyond" ([UKRI news, 19 March 2026](https://www.ukri.org/news/new-plan-to-help-the-next-generation-of-tech-businesses-thrive/)). What the July plan adds is the operating description: "through our Velocity approach, we will track the UK's most promising deep tech companies as they scale, stepping in when our support can make the greatest difference and stepping back as private investment grows" ([UKRI Delivery Plan 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/)). This is an account-management programme built around companies UKRI is identifying. The plan also commits to "embedded investor-readiness pathways to connect high-potential UKRI-backed businesses with specialist private capital" as part of the same architecture.

Running closely in parallel is an IP deadline with direct formation implications. "A refresh of UKRI's intellectual property (IP) policies, with new IP grant terms implemented by November 2026, will better anchor IP exploitation and economic value from public investment in R&I in the UK" ([UKRI Delivery Plan 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/)). The same section of the plan carries a highlight titled "new approach to IP and university patent register" — the register promising "an authoritative source of patents from the UK's excellent university research base, providing unprecedented visibility, including for businesses and investors". No date is attached to the register; the grant terms carry November 2026, and the refresh lands before the tracking framework does. For a spinout completing formation between now and Q1 2027, the licence terms that govern the IP will be set under the revised framework, not the current one. Notice the direction of travel: even the patent estate is being made visible to investors — the same legibility logic as the tracking framework, applied to IP. It is an argument [an earlier piece in this series](catalogue-before-you-commercialise.html) made from the institution's side (an asset nobody has catalogued is invisible to the systems built to commercialise it), now arriving as national infrastructure, starting with the asset class institutions already see best.

Taken together: UKRI is building a two-tier structure in which a designated subset of its portfolio gets proactive, maturity-aligned support; the rest receives the early-stage commercialisation funding it always has. That structural distinction emerges from what Velocity is, and what the tracking framework selects for.

## The space the plan was designed to fill

*The Hickson review priced the gap in February 2026. The July plan is UKRI's institutional response — and its first instrument has already opened and closed.*

The plan commits to "target UKRI investment at critical early-stage commercialisation gaps (pre-incorporation, pre-licencing and before attracting private capital) identified in the Hickson review of university-investor relationships" ([UKRI Delivery Plan 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/)). That review — [Deepening university-investor links](https://www.ukri.org/publications/deepening-university-investor-links/), commissioned by Research England and published on 3 February 2026 — reported that universities identify pre-incorporation and pre-seed as "the most underfunded areas in the innovation pipeline", with promising ideas "overlooked, left stranded or spinning out too soon and chasing grants due to insufficient pre-incorporation support" ([review report](https://www.ukri.org/wp-content/uploads/2026/02/RE-280126-DeepeningUni-InvReport.pdf)). Its first recommendation: "significantly boost funding for pre-incorporation and pre-seed funding". The cause it names is the shape of capital, not the price of advice — "return-driven investors will not invest in pre-incorporation and pre-seed stages" — and it cites an estimated proof-of-concept funding gap of around £100 million annually. Against that, the plan's own Proof of Concept portfolio commits "up to £9 million" of new awards by March 2027 ([UKRI Objectives and Key Results 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/)).

The plan pairs that targeting with a named instrument: "Our launch of a pilot Innovate UK Venture Builder Programme will help new deep tech spin-outs become investable ventures" ([UKRI Delivery Plan 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/)). Note the population — new spinouts, already formed. And note the tense the OKRs use: "piloted the Innovate UK Venture Builder Programme by December 2026" is a completion date, not an opening one ([UKRI Objectives and Key Results 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/)). The pilot's first door has already opened and closed: expressions of interest ran from 22 April to 22 May 2026, for "up to £150,000" per project from a £3.75 million fund ([Innovate UK Venture Builder Pilot expression of interest](https://www.ukri.org/opportunity/innovate-uk-venture-builder-pilot-expression-of-interest/)). Eligibility asked for a UK-registered SME "created in the last 24 months", IP from a UK university or research institute, ICURe Exploit completed within the previous two years or equivalent validation, and no more than £100,000 of prior investor funding — in three sectors: frontier AI, engineering biology, and advanced materials and manufacturing ([competition brief](https://apply-for-innovation-funding.service.gov.uk/competition/2457/overview/343a1d9f-29cb-4184-96bc-565bcfd09462)). Projects start by 1 October 2026.

The distinction matters because the two instruments solve different problems. The Venture Builder works on recently formed spinouts that have not yet raised — its stated purpose is "to support new deep-tech spin-outs and to help them in raising their first significant investment" ([Innovate UK Venture Builder Pilot expression of interest](https://www.ukri.org/opportunity/innovate-uk-venture-builder-pilot-expression-of-interest/)). Velocity is about making the ones already likely to be investable faster. A founder who arrives at the Velocity threshold — demonstrable IP, technology readiness, early investor signals — needs no programme to teach them the basics, only the right door at the right moment. The Venture Builder's first outing is what that looks like in practice: one window, five weeks, a formation-age gate, and a named prior programme in the eligibility line.

What the plan does not model is what a founder currently inside IAA or PoC should do between now and March 2027, when the tracking framework is operational. That period is the window in which designation-relevant evidence is generated or missed.

## What the designation boundary means operationally

*"High-potential" is a conclusion UKRI draws from evidence a founder has or has not produced. The tracking framework will formalise that conclusion — it will not generate the evidence.*

Start with what UKRI has published. The plan names what it looks for in the businesses it will back — "potential: a novel idea, strong team, credible technology, clear market and the resources to move forward"; "progress: evidence of performance, growth and momentum"; "need: a need that Innovate UK can meet, which the market alone will not" — underpinned by "a robust business assessment framework that looks at **team capability**, the breakthrough nature of the technology, the talent pipeline, alignment with Industrial Strategy priorities, and technology strengths relative to market demand" ([UKRI Delivery Plan 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/)). What it has not published is what the spin-out tracking framework will read: neither the delivery plan nor the OKRs name its data sources. The closest the plan comes is a tell. Future applicants "will set expectations for private investment, including investment pledged at grant award and anticipated follow-on funding", and UKRI "will track progress against these expectations". Criteria without named data sources, plus tracking against filed expectations — that is an architecture that reads records.

The sceptical reading of what such records can carry is well-grounded. In April 2026, the Policy Evidence Unit for University Commercialisation and Innovation (UCI) at Cambridge published [Towards a Roadmap for Spinout Data and Evidence](https://www.ifm.eng.cam.ac.uk/uploads/UCI/knowledgehub/documents/2026_Roadmap_SpinoutData_Final_Published.pdf), a stocktake of what the national spinout evidence base can and cannot yet see. It records "a growing consensus that quantitative metrics alone cannot capture the full complexity of spin-out formation, growth and impact". The things that most often decide outcomes — "founder motivations, team dynamics, partnership formation, decisions around IP" — are, in the roadmap's words, "rarely observable in quantitative datasets". That is a measurement gap built into the assessment infrastructure, not a performance shortfall. A founder who understands that is better positioned than one who treats the framework as a neutral assessment.

The concrete version of this: the framework can only draw on evidence that reaches a system somebody queries. The Hickson review pointed at one candidate — it recommended UKRI "use the Spin-out Register strategically" ([review report](https://www.ukri.org/wp-content/uploads/2026/02/RE-280126-DeepeningUni-InvReport.pdf)) — and from inside the programmes, the surfaces I would expect to matter are the ones institutions already file into: IAA progress reporting, Proof of Concept milestone records, HE-BCI survey returns. Where a founder's progress has been logged informally or not at all, the framework's view of that company will be thinner than the company warrants. The quality of the records will influence the designation, not just the quality of the science.

The gap between being in an IAA-funded cohort and being on UKRI's high-potential list is not something I can tell a founder to close through effort alone. I have seen what the designation boundary looks like from inside the programme — working as Impact Acceleration Manager in the Faculty of Engineering and Physical Sciences at the University of Surrey, advising academic founders on translational funding, IP structuring, and investor engagement. The founders who end up on lists like this are, in my experience, not always the ones with the strongest underlying technology but the ones whose progress is legible — documented, milestone-attested, and visible in the systems that assessors and funders actually query.

That is a structural feature of any selection process that operates at scale. The plan has made it explicit in a way it was not before. An IAA founder who treats that explicitness as a signal, and who uses the remaining months before the framework is operational to improve the legibility of their progress, is doing the work the system is designed to reward, not gaming it. And the current IAA reporting window closes on 30 October 2026.

## The lever the founder holds before November

*The November IP deadline is the last chance to form under the current terms — and the first hard date in the new architecture.*

A founder outside the likely designation pool faces a specific, tractable problem between now and early 2027 — the visibility of their progress, the structuring of their IP, and the timing of their formation.

On IP structuring: the new grant terms land in November 2026 ([UKRI Delivery Plan 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/)). UKRI's IP Strategic Statement — the document that frames those terms — expects funded organisations to implement "robust, transparent, and high-quality IP and commercialisation practices" and names the University Spin-out Investment Terms (USIT) guide alongside the KE concordat and deal readiness toolkit as recognised best practices for spinout deal structures ([UKRI Intellectual Property Strategic Statement, March 2026](https://www.ukri.org/publications/ukri-sets-expectations-for-effective-ip-management-and-use/ukri-intellectual-property-strategic-statement/)). A founder in licence negotiation now is negotiating under the current terms. The terms in force at completion will govern the company's IP position for its formation life. November is not an abstract deadline.

On formation timing: read the Venture Builder pilot's eligibility lines again — a company "created in the last 24 months", ICURe Exploit within the previous two years, no more than £100,000 raised ([competition brief](https://apply-for-innovation-funding.service.gov.uk/competition/2457/overview/343a1d9f-29cb-4184-96bc-565bcfd09462)). Formation age and prior programme lineage were both gates; the window was five weeks. If the pilot converts into a standing programme — the OKRs treat December 2026 as its delivery date, and pilots exist to be evaluated — the next window will likely rhyme: short, sector-scoped, and open to companies that formed recently with their evidence already in order. A founder who wants to be standing in the right place when it opens — a clear technology statement, a named IP licence in principle, one documented investor conversation — can build that position in ninety days by treating it as the primary task. It is the same work the tracking framework rewards. The window only decides when it pays.

The plan does not tell the founders outside the designation pool what to do. It tells the founders inside it what to expect. Reading the plan's architecture backwards, from Velocity through the tracking framework to the Hickson-gap interventions, gives a founder outside the pool a clear account of the evidence they need to generate, and the sequence in which to generate it. There is no optimism in that reading — only use of the information the system has now made public.

![Isometric sequence — four floating landings rise left to right over turquoise water: a stack of filings with the beanie founder at 30 October 2026 (IAA reporting window closes), an upright terms panel at November 2026 (new IP grant terms implemented), a small roofed tower at December 2026 (Venture Builder pilot delivered), and an ember layer at March 2027 (tracking framework goes live).](figures/ukri-selection-gate/ukri-selection-gate-sequence.png)

## Paired prompt kit

**[UKRI Selection Gate Diagnostic](/toolkit/ukri-selection-gate-diagnostic/)** — A structured prompt kit that helps IAA and PoC founders audit their milestone documentation, IP structuring, and investor-readiness evidence against the published shape of UKRI's selection architecture, before the tracking framework goes live in March 2027 ([UKRI OKRs](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/)).

## Sources

- [UKRI Delivery Plan 2026 to 2027 (13 July 2026)](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/)
- [UKRI Objectives and Key Results 2026 to 2027 (13 July 2026)](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/)
- [UKRI Intellectual Property Strategic Statement (March 2026)](https://www.ukri.org/publications/ukri-sets-expectations-for-effective-ip-management-and-use/ukri-intellectual-property-strategic-statement/)
- [Deepening university-investor links: a review by Tony Hickson (Research England / UKRI, 3 February 2026)](https://www.ukri.org/publications/deepening-university-investor-links/) — [full report PDF](https://www.ukri.org/wp-content/uploads/2026/02/RE-280126-DeepeningUni-InvReport.pdf)
- [Towards a Roadmap for Spinout Data and Evidence (UCI Policy Evidence Unit, University of Cambridge / IfM Engage, April 2026)](https://www.ifm.eng.cam.ac.uk/uploads/UCI/knowledgehub/documents/2026_Roadmap_SpinoutData_Final_Published.pdf)
- [Innovate UK Venture Builder Pilot expression of interest (opened 22 April 2026, closed 22 May 2026)](https://www.ukri.org/opportunity/innovate-uk-venture-builder-pilot-expression-of-interest/) — [competition brief](https://apply-for-innovation-funding.service.gov.uk/competition/2457/overview/343a1d9f-29cb-4184-96bc-565bcfd09462)
- [UKRI news: New plan to help the next generation of tech businesses thrive (19 March 2026)](https://www.ukri.org/news/new-plan-to-help-the-next-generation-of-tech-businesses-thrive/)
- [Ian Chapman, "UKRI's new strategy is here" (Wonkhe, 13 July 2026)](https://wonkhe.com/blogs/ukris-new-strategy-is-here/)

## Evidence note

- **UKRI tracking commitment:** quoted verbatim from the [UKRI Delivery Plan 2026 to 2027](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/ukri-delivery-plan-2026-to-2027/); the full source sentence ends "to strengthen pathways from research to business growth".
- **November 2026 IP grant terms:** quoted from the Delivery Plan. The [OKRs page](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/) carries the same commitment in completion form ("anchored IP exploitation … by refreshing UKRI's intellectual property (IP) policies by November 2026"). "New approach to IP and university patent register" is the Delivery Plan's own highlight title; the plan attaches no date to the patent register — only the grant terms carry November 2026.
- **Velocity:** the concierge-style description is verbatim from the [UKRI OKRs](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/); the "stepping in … stepping back" operating description is the Delivery Plan's. Velocity itself was announced by Innovate UK on 19 March 2026 ([UKRI news](https://www.ukri.org/news/new-plan-to-help-the-next-generation-of-tech-businesses-thrive/)).
- **The Hickson review:** *Deepening university-investor links*, by Tony Hickson, commissioned by Research England and published 3 February 2026. Quoted phrases are from the [report PDF](https://www.ukri.org/wp-content/uploads/2026/02/RE-280126-DeepeningUni-InvReport.pdf) (pp. 12, 16, 29, 31, 32, 82). The review describes two funding gaps — a pre-commercialisation gap and a scaling gap — and this piece draws only on its under-funding finding; it does not claim pre-incorporation is the single dominant failure point. The £100 million figure is the review's own cited estimate (p. 32 of Hickson's report).
- **The spinout data roadmap:** quotes are verbatim from [*Towards a Roadmap for Spinout Data and Evidence*](https://www.ifm.eng.cam.ac.uk/uploads/UCI/knowledgehub/documents/2026_Roadmap_SpinoutData_Final_Published.pdf) (UCI Policy Evidence Unit, University of Cambridge; authored by IfM Engage; April 2026), page 24. The published PDF is image-rendered rather than machine-readable text, so the quoted passages were transcribed from the published document and independently re-checked against it before publication.
- **Venture Builder pilot:** the window, award size, fund size and stated purpose are from the [UKRI expression-of-interest page](https://www.ukri.org/opportunity/innovate-uk-venture-builder-pilot-expression-of-interest/) (marked closed as of 19 July 2026); the incorporation-age, ICURe, prior-funding and sector conditions, and the 1 October 2026 project start, are from the [Innovation Funding Service competition brief](https://apply-for-innovation-funding.service.gov.uk/competition/2457/overview/343a1d9f-29cb-4184-96bc-565bcfd09462). The OKR phrase "piloted … by December 2026" is a delivery deadline for the already-running pilot, not a future opening date.
- **The 55% ambition:** attaches to the OKRs' live-portfolio line — businesses "in the live portfolio" holding private equity or venture capital investment — not to spinouts. The spinout ambition is directional only, with no numeric target ([UKRI OKRs](https://www.ukri.org/publications/uk-research-and-innovation-delivery-plan-2026-to-2027/our-objectives-and-key-results-2026-to-2027/)).
- **Selection criteria versus data sources:** the "potential / progress / need" criteria and the business-assessment-framework sentence are published for the businesses Innovate UK backs; they are not a published specification of the spin-out tracking framework, and the piece does not treat them as one. As of 19 July 2026, neither the Delivery Plan nor the OKRs names the data sources the tracking framework will draw on. The body's list of likely surfaces — IAA progress reporting, Proof of Concept milestone records, HE-BCI survey returns — is my expectation from working inside these programmes, not a sourced claim.
- **"More selective" quote:** Ian Chapman, UKRI's chief executive, writing on [Wonkhe on 13 July 2026](https://wonkhe.com/blogs/ukris-new-strategy-is-here/); the fuller sentence describes "a concierge service to the highest-growth potential companies".
- **USIT:** UKRI's IP Strategic Statement names the "University Spin-out Investment Terms (USIT) Guide and USIT for Software" among recognised best-practice tools. That is recognised best practice — not a stated requirement of the November 2026 grant terms.
- **First-person passages:** the designation-boundary observations draw on my role as Impact Acceleration Manager in the Faculty of Engineering and Physical Sciences at the University of Surrey (January 2020 to present), advising academic founders and working directly with IAA-funded cohorts. The 30 October 2026 IAA reporting date is stated from that operational vantage point, not from a public UKRI source. These are lived-experience testimony, not public-sourced claims.
- **The two-tier reading:** describing Velocity plus the tracking framework as a "two-tier structure" is this piece's inference from the plan's architecture — the plan does not use that language. It is the only inference in the piece not carried by a quoted source.