University Spin-Offs: What Works?

A recent conference in Bonn that reviewed results from three Paxis ( Pilot Action of Excellence on Innovative Start-ups) projects on academic entrepreneurship concluded that although there are many successful models to choose from, what works for one university may not work for another. ?

The desert of Eritrea may not seem like fertile ground for entrepreneurial spirit, but to Carl Hodges it was an opportunity in waiting. For several years his company has been developing a desert farm irrigated by water from the Red Sea. It produces shrimp and fish for the European market, cultivates sea asparagus, and harbors a nascent mangrove forest. In the long term, Hodges sees the farm as a model for wealth creation and sustainable development in one of the poorest countries in the world. His personal account of this extraordinary venture was one of the highlights of the 2-day USE-it conference, which was held in Bonn in April to report on good practice in promoting academic entrepreneurship.

Sponsored by the European Commission?s Directorate-General for Enterprise, the conference was primarily convened to share the results of three Paxis projects: Usine, Spinnova, and Embryo. What these projects have in common, explained conference organiser Birgit Wirsing, is that each helps academic researchers get a foot on the business ladder. ?The projects all aim to promote the setting up of technology-based spin-off firms from universities. They ask how we can encourage researchers to start their own enterprises, and how we can best establish programmes and infrastructures to support them.?

Usine, Spinnova, Embryo

In Usine, a pre-incubator model developed at the University of Bielefeld is being transferred to universities in Valencia and Paris. Spinnova focuses on providing would-be academic entrepreneurs in Belgium, Germany, the Netherlands, and Spain with training, advice, and information, with the ultimate aim of creating entrepreneurial universities. Embryo, run by the Universidad Miguel Hernández in Elche and the University of Twente, concentrates on a new way to set up and develop ?embryo? companies run by researchers and entrepreneurial students.

Looking beyond these three projects, the delegates also discussed good practice in running successful spin-off programmes from Santiago de Compostela to Strathclyde. Delegates from Israel and Sweden described how technology-based start-ups in small countries have no alternative but to tackle international markets because their home markets are so limited.

And Europeans, it seems, should not feel too gloomy. Although Peter van der Sijde of Twente University acknowledged that ?we commonly assume that the EU lags behind the US in innovation performance and the creation of technology-based enterprises,? the conference heard evidence to the contrary. Ederyn Williams of Warwick University showed that universities in the United Kingdom are more successful in forming spin-off companies than their counterparts in the United States. UK universities, Williams said, generate one spin-off company per ?25 million of research budget (versus one per ?87 million in the US), disclose one invention for every ?2 million (?3 million in the US), and form one spin-off for every 13 disclosures (29 in the US). He attributed the difference to the lower salaries paid to UK researchers and the less legalistic, more business-oriented approach of UK technology-transfer offices. ?Europe needs to be more self-confident about what our universities can achieve,? remarked van der Sijde.

One Size Does Not Fit All

The conference?s purpose of exchanging good practice makes Wirsing?s summing up surprising. ?I think the most important outcome was that the direct transposition of a support scheme from one university to another is just not possible,? she says. ?You really have to adapt any scheme to its specific local and regional context.? For example, at one university a pre-incubator scheme may be funded by the regional government as an instrument of economic development. At another, a similar scheme may be run by the university primarily to generate private income. They may appear to be doing the same thing, but the structure is very different.

Van der Sijde agrees, and his advice to technology-transfer officers is to shop around. ?They really have to look at their particular environment, the entrepreneurial orientation of their university, their region?s existing innovation structures and programmes, and its main development priorities. Then they can decide which support structures and programmes make sense in that specific context and how to fit them into the existing framework.?

As Carl Hodges returns to Eritrea to tend his shrimp, he can rest assured that he left a lasting impression on the 120 delegates in Bonn. ?What we found so interesting was to have an entrepreneur at the conference who has realised his vision,? says Wirsing. ?Many people have a vision but see no way to realise it. He told us that he had thought about his vision for more than 30 years, and finally he has made it come true.?


B. Wirsing, University of Bonn/EuroConsult

Tel.: +49 228 733 073

Fax: +49 228 731 982

This article was reproduced, with minor amendments and with the permission of the original publisher, from the July 2002 edition of Innovation & Technology Transfer magazine, published by the European Commission's Directorate-General for Enterprise.

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