University Spin-out Research Articles

Collaboration with entrepreneurship education programmes: building spinout capacity at universities

As University Spinouts (USOs) have become a highly desirable outcome for commercialisation efforts, the development of entrepreneurial capacity within the university system becomes increasingly more important. We hypothesise that Entrepreneurship Education (EE) programmes ceterus paribus may play a role in developing this capacity. This paper examines the attitudes and perceptions of academics who are directly involved in the field of EE programmes with four research goals in mind: 1) to determine whether or not there are perceived advantages to collaboration between EE programmes and technology transfer departments; 2) to identify specific factors that influence these perceptions; 3) to query academics regarding the perceived barriers to collaboration; 4) to identify whether collaborations already exist and categorise them. Our findings suggest that significant advantages from collaboration between these two functions are perceived and that indirect linkages are believed to be more important than direct linkages.

Entrepreneurial innovation problems associated with the dynamic growth of university spin-outs in China: a capabilities perspective

This research aims to develop a capabilities-based conceptual framework in order to study the stage-specific innovation problems associated with the dynamic growth process of university spin-outs (hereafter referred to as USOs) in China. Based on the existing literature, pilot cases and five critical cases, this study attempts to explore the interconnections between the entrepreneurial innovation problems and the configuration of innovative capabilities (that acquire, mobilise and re-configure the key resources) throughout the lifecycle of a firm in four growth phases. This paper aims to contribute to the literature in a holistic manner by providing a theoretical discussion of USOs' development through adding evidence from a rapid growth emerging economy. To date, studies that have investigated the development of USOs in China recognised the heterogeneity of USOs in terms of capabilities still remain sparse. Addressing this research gap will be of great interest to entrepreneurs, policy makers and venture investors.

Commercializing nanotechnology innovations from university spin-out companies

Commercializing nanotechnology innovations from university spin-out companies

From Bureaucratic Tech Transfer to Entrepreneurial Tech Commercialization

60 university spinouts in 3 years. 94% still alive. Lowest cost per spinout in the US. The 'book' on successful technology transfer is to find multiple ways to substitute bottom-up entrepreneurial approaches for top-down bureaucratic mechanisms. However, few programs successfully manage the transition to entrepreneurial mode. How did they succeed where so many do not? We present an overview of the new University of Utah program where spinouts have skyrocketed (the stats above). We share the key facets of their multiple entrepreneurial approaches that converged on their current success, supported by theory and evidence from other successful programs that will give the audience critical 'lessons learned' and a deeper understanding of how other institutions can deploy this constellation of entrepreneurial mechanisms. How does Utah (and other top programs) put entrepreneurs first? How can we replicate their success? Etzkowitz (2008) shows that despite the press and PR, the median TTO loses money - probably more than is usually known. Only a handful regularly generate significant positive cash flow. How do they differ? We offer here a set of key principles for successful technology commercialization, illustrated by a very recent exemplar, that of the University of Utah. As opposed to a case study where the story unfolds and key best practices identified en route, this essay builds a model for successful technology commercialization organized into five key elements. For each element, we then describe the Utah model in those terms, followed by lessons for application elsewhere.

The Commercialization of Advanced Material Technologies by University Spin-Outs

The Commercialization of Advanced Material Technologies by University Spin-Outs

Envirox™ fuel-borne catalyst: Developing and launching a nano-fuel additive

The paper presents a product case study tracing the challenges of commercialization from research and product development to market launch. Envirox™ is a diesel fuel additive containing nanoparticles of cerium oxide, which enables fuel efficiency gains alongside reductions in harmful emissions such as black carbon (soot). The case traces developmental stages from lab experimentation and performance data sets, to raising finance, securing manufacturing capability and market testing in Hong Kong and the UK. The paper raises a number of generic and specific issues facing innovative small, university spin-out companies engaged in introducing nano-products to the market-place.

DISAGGREGATING FIRMS IN ANALYSING THE COSTS AND BENEFITS OF THE UNIVERSITY–INDUSTRY RELATIONSHIP: BASED ON AN ANALYTICAL AND EMPIRICAL STUDY FROM SCOTLAND

It has been acknowledged that universities are key institutions in national and regional systems of innovation. This recognition has led to a rich stream of literature analysing the university–industry relationship. However, relatively little attention has been devoted to disaggregating the ‘industry’ side of this relationship and examining the costs and benefits to the disaggregated parties involved. In the present article, which draws on an analytical and empirical study from Scotland, it is suggested that it makes sense to distinguish between three kinds of firms in analysing the university–industry relationship: large national and international R&D-intensive firms, university spin-out firms, and established small- and medium-sized enterprises (SMEs) that have had little interaction with universities. The different costs and benefits facing these firms in their interactions with universities are analysed. It is concluded that the established SMEs confront relatively high costs in relating to universities. Finally, the policy implications are explored.

Global market for energy and environmental catalysts

The creation of university spin-out companies that create wealth is a major policy objective of governments and universities. Finance is a catalyst of this wealth creation yet access to venture capital is a major impediment faced by these companies. In this article we adopt a finance pecking order perspective to examine the problems faced by those university spin-out companies seeking to access venture capital. We triangulate evidence from spin-out companies, university technology transfer offices and venture capital firms in the UK and Continental Europe to identify the problems and to suggest policy developments for these parties as well as government. We compare perceptions of high-tech venture capital firms that invest in spin-outs with those that do not, and also consider VCs’ views on spin-outs versus other high-tech firms. Our evidence identifies a mismatch between the demand and supply side of the market. In line with the pecking order theory, venture capitalists prefer to invest after the seed stage. However, in contrast to the pecking order theory, TTOs see venture capital as more important than internal funds early on. We develop policy implications for universities, technology transfer offices, academic entrepreneurs, venture capital firms and government and suggest areas for further research.

Lessons for the Nascent Regenerative Medicine Industry from the Biotech Sector

Recently, Gary Pisano, a respected Harvard Business School professor, who has long followed the biotech industry, published a new book, Science Business: The Promise, the Reality, and the Future of Biotech [1]. It contains evidence for some striking conclusions, most stark of which is that the industry in aggregate has never made a profit. This tends to be overlooked because a handful of companies, most notably Amgen, have been so brilliantly successful (Figure 1). A second conclusion is that biotech ventures in general have been consistently no better or worse than pharmaceutical companies over a 25-year period in terms of cumulative R&D costs incurred per new drug launched. Pisano examines why the performance of the biotech sector as a whole evidently has not been better and concludes that the industry is quite different to the silicon-based information technology sector. There, too, the pattern of university spinouts, venture funding and investment by major companies is found. However, in information technology, the intellectual property situation is more straightforward and the activities can be separated into modular parts that are distinct and relatively easy to interface and trade between stakeholders. In biotech, the elements of drug R&D are not modular, but are heavily interdependent. There is also, in spite of the great advances in biosciences, still a considerable degree of art to the discovery process and the judgements that follow. The intellectual property situation is also complex, with greater uncertainty of outcome on poorly defined and overlapping patents versus the more concrete intellectual property of software code [MacKay G, Pers. Comm.]. Again, in contrast to semiconductors, the new biopharmaceutical proteins of the biotech sector

COMMERCIALIZING A DISRUPTIVE TECHNOLOGY BASED UPON UNIVERSITY IP THROUGH OPEN INNOVATION: A CASE STUDY OF CAMBRIDGE DISPLAY TECHNOLOGY

This paper discusses the use of a university spin-out firm to bring a potentially disruptive technology to market. The focus for discussion is how a spin-out can build a technology ecosystem of providers of complementary resources to enable partner organizations to build competence in a novel and potentially disruptive technology. The paper uses the illustrative case of Cambridge Display Technology Ltd (CDT) to consider these issues from the perspective of the literature on open innovation (with particular emphasis on the role of partnerships between start-ups and established firms), the commercialization of university IP, and the commercialization of disruptive technologies.

Wireless monitor for cathodic protection in remote sites: a case study for a university spin-out company

This paper describes how a new spin-out company managed to develop a product and bring it to market. The product, a wireless monitor system for use on cathodic protection equipment, is described briefly with emphasis on the main technical challenge of ultra low power demand.The rest of the paper is devoted to the real challenges facing a new spin-out company: ensuring that its product has a market and obtaining the finance to develop it. It shows how government grants and collaboration with an established company can help.

The Role of University Spinout Companies in an Emerging Technology: The Case of Nanotechnology

This study examines the role of university spin-out (USO) companies in the emergence of a new technology, in our case nanotechnology. Three unique data-sets based on patents, co-publications, and firm data pertaining to the unfolding field of nanotechnology in the UK were developed. Subsequent analysis suggests that USOs play an important though not a dominant role. Furthermore, the results indicate that USOs in certain subfields of nanotechnology do not have a strong and growing proprietary technology base, raising questions about the commercial sustainability of these ventures. Overall, we observed that USOs are important contributors to technological change in specific subfields of nanotechnology, but that other actors, notably, large firms and (non-university affiliated) new technology-based firms are even more significant agents of technological change.

Gender and the commercialization of university science: academic founders of spinout companies

There is a great deal of interest in Europe and the USA on the commercialization of university science, particularly the creation of spinout companies from the science base. Despite considerable research on academic entrepreneurship, female entrepreneurship in general, and the causes of under-representation of female scientists in academic institutions, there has been little research on the influence of gender on academic entrepreneurship. The study researches female founders of UK university spinout companies using information from the Internet on company founders of spinout companies from 20 leading universities. The proportion of female founders at 12% is very low. The paper explores reasons for this low representation through follow-up postal interviews of the 21 female founders identified, and a male control sample. Under-representation of female academic staff in science research is the dominant but not the only factor to explain low entrepreneurial rates amongst female scientists. Owing to the low number of women in senior research positions in many leading science departments, few women had the chances to lead a spinout. This is a critical factor as much impetus for commercialization was initially inspired by external interest rather than internal evaluation of a commercial opportunity. External interest tended to target senior academics, which proportionally are mostly male. A majority of the women surveyed tended to be part of entrepreneurial teams involving senior male colleagues. As a whole both male and female science entrepreneurs displayed similar motivations to entrepreneurship, but collectively as scientists differed appreciably from non academic entrepreneurs. Women science entrepreneurs also faced some additional problems in areas such as the conflict between work and home life and networks.

University spin-out companies and venture capital

The creation of university spin-out companies that create wealth is a major policy objective of governments and universities. Finance is a catalyst of this wealth creation yet access to venture capital is a major impediment faced by these companies. In this article we adopt a finance pecking order perspective to examine the problems faced by those university spin-out companies seeking to access venture capital. We triangulate evidence from spin-out companies, university technology transfer offices and venture capital firms in the UK and Continental Europe to identify the problems and to suggest policy developments for these parties as well as government. We compare perceptions of high-tech venture capital firms that invest in spin-outs with those that do not, and also consider VCs’ views on spin-outs versus other high-tech firms. Our evidence identifies a mismatch between the demand and supply side of the market. In line with the pecking order theory, venture capitalists prefer to invest after the seed stage. However, in contrast to the pecking order theory, TTOs see venture capital as more important than internal funds early on. We develop policy implications for universities, technology transfer offices, academic entrepreneurs, venture capital firms and government and suggest areas for further research.

Spin-out fever: Spinning out a University of Oxford company and comments on the process in other universities

University spin-out companies are increasing seen as a favoured route for commercialisation of university intellectual property. There has been criticism in the Lambert Review of Business–University Collaboration in 2003, commissioned by the UK Government in 2003, that there have been too many spin-outs of low quality and that a measure of quality is the amount of external equity they attract. This has been refuted by Dr Williams of the University of Warwick technology transfer office. Oxford University has created 42 companies with no failures. The rigorous process involved in the creation of an Oxford spin-out is given in some detail. The author then goes on to discuss his experiences of other university spin-out models. Finally, some of the tax problems that caused universities across the UK to stop spinning-out companies recently are discussed. In conclusion despite the criticisms, the author believes the process of creating companies to commercialise university R & D is critical to the overall success of UK plc in the long term.

Spin-out fever: Spinning out a University of Oxford company and comments on the process in other universities

University spin-out companies are increasing seen as a favoured route for commercialisation of university intellectual property. There has been criticism in the Lambert Review of Business–University Collaboration in 2003, commissioned by the UK Government in 2003, that there have been too many spin-outs of low quality and that a measure of quality is the amount of external equity they attract. This has been refuted by Dr Williams of the University of Warwick technology transfer office. Oxford University has created 42 companies with no failures. The rigorous process involved in the creation of an Oxford spin-out is given in some detail. The author then goes on to discuss his experiences of other university spin-out models. Finally, some of the tax problems that caused universities across the UK to stop spinning-out companies recently are discussed. In conclusion despite the criticisms, the author believes the process of creating companies to commercialise university R & D is critical to the overall success of UK plc in the long term.

The new tax rules for university spin-outs: An answer to all the problems?

This paper gives an overview of the potential tax position for an academic participating in a university spin-out following the new legislation in the UK Finance Act 2005. The paper outlines a university spin-out transaction and explains the possible tax problems in this area since 2003. It then discusses the conditions that need to be met for an academic to potentially benefit from the new tax relief and some of the remaining issues. It concludes with some practical advice for structuring transactions.

The new tax rules for university spin-outs: An answer to all the problems?

This paper gives an overview of the potential tax position for an academic participating in a university spin-out following the new legislation in the UK Finance Act 2005. The paper outlines a university spin-out transaction and explains the possible tax problems in this area since 2003. It then discusses the conditions that need to be met for an academic to potentially benefit from the new tax relief and some of the remaining issues. It concludes with some practical advice for structuring transactions.

University spin-outs and their management challenges

University spin-outs are increasingly in the spotlight. Inherent differences in attitude and skills between academia and managers of commercial business have resulted in some very poor quality spin-outs. The author examines why academic spin-outs are not as successful as they could be. He concludes that universities can and do have successful spin-outs from which to build their endowments, if they create a proper framework and management structure which filters and allocates technology transfer resources and creates suitable separation of academic staff and spinout staff plus providing an appropriate risk/reward compensation scheme.

Resources, capabilities, risk capital and the creation of university spin-out companies

The commercialization of university research has become an increasingly important issue, given concerns regarding licensing and the university's desire to maximize the returns to intellectual property (IP). In this paper, we assess the impact of university resources and routines/capabilities on the creation of spin-out companies. We find that both the number of spin-out companies created and the number of spin-out companies created with equity investment are significantly positively associated with expenditure on intellectual property protection, the business development capabilities of technology transfer offices and the royalty regime of the university. These results highlight the importance not just of resource stocks, but also of developing appropriate capabilities of technology transfer officers in spinning-out companies. The results suggest that universities and policy-makers need to devote attention to the training and recruitment of technology officers with the broad base of commercial skills.