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HEFCE closed at the end of March 2018. The information on this website is historical and is no longer maintained.

Many of HEFCE's functions will be continued by the Office for Students, the new regulator of higher education in England, and Research England, the new council within UK Research and Innovation.

The HEFCE domain - - will continue to function until September 2018. At this point we will close the site entirely and all its information will only be available from the National Web Archive.


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This report summarises exploratory and experimental research to consider ways to provide evidence on the value of student enterprise, including student start-ups and the contribution of students to spin-outs from English higher education institutions (HEIs). The report was commissioned by HEFCE from PACEC (Public and Corporate Economic Consultants), in collaboration with the Centre for Business Research, Cambridge.

The main findings of the report are as follows: 

  • The report confirms HEFCE knowledge exchange (KE) funding supports student entrepreneurship. The report concludes a tentative return on investment (ROI) gross annual value of £2.7bn p.a. of student start-ups and spin-outs emerging from English HEIs in 2013, with an ROI for every £1 of Higher Education Innovation Funding (HEIF) of £3.36 – assuming all university effects are attributed to HEIF in business value (i.e. all sales/turnover) or £1.14 – assuming only KE Enterprise support can be attributable to HEIF. This is additional to the £6.3/£1 calculation, as published in April 2014 in 'Knowledge exchange performance and the impact of HEIF in the English higher education sector', a report by Tomas Coates Ulrichsen.
  • The report reached an interesting conclusion on how the subject studied is influential in terms of the types of businesses started – studying engineering, and art and design-related subjects particularly leads to enterprise pathways (in over half of start-ups/spin-outs). One of the reasons for this is suggested as the lower market entry costs in art and design and some computing/software development. 
  • Relatively high proportions of respondents said they were influenced to start-up by their university support – including the subjects/courses studied and KE enterprise support which had helped them further develop skills such as business management, innovation and financial management. University support was suggested as critical in later stages of business development (post-university) but not necessarily covered by universities at present. There are opportunities for universities to improve communication with their alumni and support to their business growth, as well as improve support to entrepreneurial students. 
  • The HEIs surveyed consider that a significant proportion of HEIF/KE funding is allocated towards supporting start-ups, including through leveraging other funding, such as ERDF. However, there appeared to be more student enterprise activity demonstrated in some HEIs with lower levels of HEIF (schools of the arts in particular) where there were higher levels of start-ups with business formation in the arts and design sectors. In these cases, the curriculum was more influential than separate KE and enterprise support. 

A number of improvements to future surveys of student start-ups and spin-outs are suggested for future tracking purposes.