Industry–University (I–U) collaboration, is becoming recognised as a critical form of learning alliance, and an essential instrument to gain speed and flexibility in innovation, while reducing cost in R&D. A key question emerging in this context is: How can the different organisational requirements for exploration vs. exploitation be addressed in I–U collaborations to secure creation, transfer and implementation of innovation? In this paper, I will and propose a theoretical framework to enhance our understanding of how to organise the balance between exploration and exploitation in I–U collaborations to allow for public to private sector knowledge/technology transfer.