Spin-offs, stages of growth and funding issues: some UK evidence

Abstract

This paper explores funding issues at the early development stages of Technology-Based Small Firms (TBSFs) spun-out from universities, non-university research organisations and parent companies. This paper presents empirical evidence for the UK, derived from an extensive online questionnaire survey. The sample consists of 53 spin-offs representing a subsample of 133 TBSFs. The sample is divided into three subcategories, university, non-university and parent company spin-offs. The results suggest that high technology small firms which have spun-off from other organisations may have particular needs for finance and that these may change as they develop through the early stages of development. The results further suggest that there are funding heterogeneities among university, non-university and parent company spin-offs. This paper presents evidence on these issues and suggests differences in the experience of various types of spin-off TBSFs both in terms of economic performance and financing.