This study analyses the effect of a change of focus in a traditional mission (teaching) of higher education institutions (HEIs) on the variety and intensity of knowledge exchange (KE) activities. In doing so, it bridges two partially disconnected streams of the literature in science and innovation focusing on HEI missions and heterogeneity in HEI KE activities. The work relies on a longitudinal dataset from UK Research and Innovation (UKRI) comprising information on publicly funded research projects over the 2006-2013 period. Our identification strategy exploits the change in tuition fees following a 2012 reform to proxy for the increased attention to the teaching mission of English and Welsh HEIs compared to other HEIs in the UK. Results show a strong negative effect of the increase in tuition fees on the variety and intensity of KE activities by English and Welsh HEIs. Following the reform, applications for competitive research funding by English and Welsh HEIs did not change in terms of grant length, value and the number of collaborating partners.