Some organizations use universities to explore new areas, whereas others turn to universities to exploit knowledge for immediate and practical gain. Drawing on the behavioral theory of the firm and the literature on university–industry collaboration, we examine how the level of financial slack available to a firm influences their level of explorative and exploitative knowledge sourcing from universities. We suggest that two types of proximity moderate this relationship: organizational and geographical. Using on a rich sample of university collaborators, we find—consistent with our expectations—that high levels of financial slack are associated with explorative knowledge sourcing, whereas low levels of slack are associated with exploitative knowledge sourcing. Our results also point out that organizational proximity can complement for the lack of financial slack in shaping explorative knowledge sourcing, while it can heightens the effects of low levels of financial slack on exploitative knowledge sourcing. In contrast, we find that geographical proximity plays a weaker moderating role compared to organizational proximity. We explore the implications of these findings for our understanding of university–industry collaboration.