The thriving state of student startups
Creator Fund, the university-focused venture capital fund, has released its “State of Student Startups” report, which gives a comprehensive national picture of what the UK’s best young minds are starting, and how to best support them. The report found that more than half of UK campus ventures have a foreign student founder.
Attracted by the nation’s highly reputed universities and their capability to be world-leading startup launchpads, Creator Fund found that six in ten companies started on campus have a non-British founder. This highlights the critical role that these institutions hold in driving the nation’s ambition to be a global technology centre, and this includes retaining international student numbers despite the challenges of Covid and Brexit.
Creator Fund’s State of Student Startups report examined more than 500 student-led startups it met with in the last eight months. It found that a majority of UK startups have a foreign founder, with China being the leading nationality, and 25% hailing from the EU.
Creator Fund’s report also suggests a link between the above average rate of BAME student founders and the high number of diverse international founders. Nearly half (43%) of UK student-led startups had a BAME founder and 40% had a female founder. Creator Fund identified that the most diverse startups teams hail from Oxbridge universities, which is potentially driven by the higher number of international students on campus.
Jamie Macfarlane, founder and CEO said, “Our report supports our belief that universities have a key role in building the UK as a global technology centre of excellence. Cov-19 has not slowed student founders down, they have invested their extra free time to work on their ideas. The entrepreneurial ecosystems in universities up and down the country show us the plethora of world-class, international, diverse talent working together to deliver innovation. We need to make student founders have the right access to capital and strategic support, which is what we are doing with Creator Fund.”
UK universities prioritise healthtech
Creator Fund, which is backed by Founders Factory, also found that healthcare is a priority for student founders - 16% of startups are in healthcare and a further 4% operate in biotech. This includes a number of startups who have pivoted existing models to help tackle Covid. Another key sector seeing movement is food and agriculture and the Creator Fund found that, despite its leadership in finance, LSE is the leader in generating FoodTech startups, with Scotland universities also being particularly strong in the area.
Innovation happening across the country
The report shows how much innovation is happening outside the traditional hotspots in the South East. While 71 pence over every £1 of venture funding in the UK goes to London overall, Creator Fund found that only 62% of student startups are coming from outside the capital. And 40% are from outside London and Oxbridge.
Macfarlane added, “Universities are key for driving growth beyond the strongly ventured parts of the South East”
Creator Fund is based on the successful initiatives that have driven university entrepreneurship in the United States. The report looks at some of the major differences between the US and UK ecosystems, and found that startup activity here is much more focused on Masters and PhD students. Whereas in the US, success stories like Facebook and Snapchat have helped drive much more activity led by undergrads.