Academics' organizational characteristics and the generation of successful business ideas

This paper deals with the generation of Business Ideas (BI) by academics. It investigates organizational factors affecting the process through which new ventures are established by academics and are likely to affect their performance. The BI Market Attractiveness and the BI Articulation are addressed as two characteristics of academic spin-off companies which are likely to lead to their success. Two research hypotheses are formulated: (a) that the BI Market Attractiveness at the time of establishment of the new venture is positively influenced by the market orientation of the academic founders, and by their frequency of interaction with external agents; (b) that the BI Articulation at the time of establishment of the new venture is positively affected by the articulation of roles, and by the degree of prior joint experience of the academic founders. We test our hypotheses on a sample of 42 Italian academic start-ups. Implications for both universities and academic entrepreneurs are discussed.     

Ethnic-immigrants in founding teams: Effects on prospector strategy and performance in new Internet ventures

We investigated differences in strategy and performance between new Internet ventures with ethnic-immigrant members in the founding team and a matched set of Internet ventures with non-ethnic-non-immigrant team members. Results showed that new ventures with an ethnic-immigrant presence in the founding teams tended to pursue a more aggressive prospector strategy than those with non-ethnic-non-immigrant founding team members. Still, performance of the two groups of ventures was comparable. However, the positive effects of ethnic-immigrant presence on founding teams depended on team size and average age of the founding team members.     

University spin-off's performance: Capabilities and networks of founding teams at creation phase

The extant literature highlights that environmental conditions, during the creation phase, imprint on a start-up's survival and growth. However, there are few studies that explore the composite nature of a founding team's capabilities and networks, developed within this phase, and the contribution made to future performance. This paper uses the distinctive context of university spin-offs, where early stage ventures are fostered by institutional interventions, to analyse the influence that the capabilities and networks of a founding team, at incorporation, have upon the future performance of the spin-off. Based on data from 181 university spin-offs, this paper empirically demonstrates that the entrepreneurial capabilities of a founding team, augmented during the ‘creation’ phase, have a positive influence on the performance of a spin-off during the ‘growth’ phase, and that the networks of a founding team indirectly affect a spin-off's performance through the enhancement of a team's entrepreneurial capabilities.     

A founding-team model of creating a venture's culture

As many new ventures are started by founding teams, it is these founding teams that likely engage in creating their venture's culture. We draw on theories of cultural dynamics and the literature on team cognitive diversity to investigate the creation of a new venture's culture. Specifically, we theorize how a founding team's cognitive diversity impacts the team's production of cultural information and the transmission of that information throughout the venture. Cognitive diversity directly influences the founding team's production of cultural information by shaping the diversity of the information set and the speed of its production. Moreover, cognitive diversity can give rise to faultlines within the venture, impacting how venture members interpret cultural information. Importantly, our model suggests a complex interplay between the production and interpretation of cultural information. Understanding culture creation in new ventures is important because a new venture's culture shapes its legitimacy and thus its access to stakeholder resources for venture emergence.     

Does negative feedback impact new ventures' organizational identity? The role of founding teams' human capital and feedback source

Although a strong organizational identity (OI) is important for venture success, the impact of negative feedback on a new venture's OI is poorly understood. Drawing on human capital theory we argue that founding teams with more founding and industry experience can more effectively defend OI after negative feedback. Using literature on intra-group bias we further theorize that these benefits of founding and industry experience are more pronounced when feedback emerges from sources external rather than internal to the venture. A multi-period research design and data on 1528 survey responses from 598 members of 81 ventures support our model.     

The role of the entrepreneurial team and the board of directors in the internationalization of academic spin-offs

This study addresses the roles of the entrepreneurial team and the board of directors in the internationalization of academic spin-off companies. The study is based on a quantitative analysis of 109 spin-offs from Norwegian academic institutions. The findings suggest that academic spin-offs are more likely to achieve both international strategic alliances and international sales with entrepreneurial teams having industrial experience that is both highly homogeneous (where each member has work experience in the same industry) and highly diverse (where each member has work experience in different industries) and board members that have diverse functional backgrounds. Firms that are less dependent on networking by board members to increase legitimacy and build relationships with potential foreign customers are more likely to achieve international sales.     

The Determinants of Entrepreneurial Intention of Young Researchers: Combining the Theory of Planned Behavior with the Triple Helix Model

Although the theme of academic spin‐off has received increasing consideration in entrepreneurship literature, little attention has been devoted to identifying the factors that drive young researchers to set up ventures based on the results of their research. To identify the determinants of academic entrepreneurial intention (AEI), we tested a model on a sample of Italian researchers using structural equation modeling and integrating the Triple Helix Model with the theory of planned behavior (TPB). The findings highlight that all psychological variables of TPB are relevant in predicting AEI, whereas only some contextual and exogenous variables (namely, government and industrial/financial support) directly influence AEI.     

A double-edged sword? Founder Teams' Prior International Experience and INV International Scale-up

We examine the effect of international new ventures’ (INVs) congenital knowledge inherited from their founding teams vs. their experiential knowledge gained through learning by doing on the initiation vs. continuation of their international growth. Data from 144 technology INVs show that the effect of congenital knowledge fades as experiential knowledge accrues over time and fuels sustained international growth. The relationships are moderated by whether founder teams’ work experience is in the same or a different industry as the INV as well as the level of external funding received by the INV. Our study and results contribute to the literature on INVs’ post-entry internationalization.     

Emerging life sciences ventures: The quest for legitimacy

As an emerging life sciences venture, gaining legitimacy (credibility) with external stakeholders (e.g., investors) is a critical challenge in today's environment. This quest for legitimacy relates to issues that focus on the individual, the environment, and the process. Integrating insights gained from interviews with three CEOs of life sciences companies along with the academic literature, we provide guidance for entrepreneurs regarding the unique challenges facing life sciences ventures. We propose that these ventures are driven by a “quest for legitimacy” and that life sciences entrepreneurs therefore must be aware of the strategic issues which impact legitimacy in the eyes of external stakeholders (e.g., investors).     

The origin of spin-offs: a typology of corporate and academic spin-offs

We provide a typology of corporate and academic spin-off types, distinguishing spin-offs involving new ventures from those that concern existing activities. We summarize the papers published in this special issue, relating them to the typology we develop. We conclude by developing an agenda for further research on spin-offs.     

Member Experience,Use of External Assistance and Evaluation of Business Ideas

How do members' experience and external interactions shape evaluation of the team's business idea? With a sample of 74 teams that participated in a business idea competition, we showed that experience as defined by size, mean work experience, and assistance from individuals with business founding experience related positively to the teams' business idea evaluations. The benefits of external founders are more pronounced for smaller than for larger teams. Having a founder in the team did not relate to idea evaluation but interaction effects showed smaller sized teams had worse evaluations if they did not have a founder in the team.     

University spin-offs and the “performance premium”

The creation of spin-off companies is often promoted as a desirable mechanism for transferring knowledge and technologies from research organizations to the private sector for commercialization. In the promotion process, policymakers typically treat these “university” spin-offs like industry start-ups. However, when university spin-offs involve an employment transition by a researcher from the not-for-profit sector, the creation of a university spin-off is likely to impose a higher social cost than the creation of an industry start-up. To offset this higher social cost, university spin-offs must produce a larger stream of social benefits than industry start-ups, a performance premium. This paper outlines the arguments explaining why the social costs of entrepreneurship are likely to be higher for academic entrepreneurs, and empirically investigates the existence of a performance premium using a sample of German start-up companies. We find that university spin-offs exhibit a performance premium of 3.4 % points higher employment growth over industry start-ups. The analysis also shows that the performance premium varies across types of academic entrepreneurs and founders’ academic disciplines.     

Linking prefunding factors and high-technology venture success: An exploratory study

This study reports on the exploratory phase of a research project on prefunding factors influencing the success of high-technology start-up companies. The study was done in collaboration with two major West Coast venture capital firms that allowed the authors full access to the due diligence files, investment proposals, and closing documents associated with eight ventures. Half of the eight ventures studied are currently public companies with sales that range from $65 million to $500 million and with an after-tax profit of about 10% of sales. The other half have either been dissolved or did not reach $3 million in sales within the five years following their funding.Information was obtained on those prefunding factors that were available for investor review prior to funding, such as the founders track records, the characteristics of the founding team, the nature of the target market, the technological strategy of the firm, the proposed composition of the board, and the deal structure.In spite of the small sample size, findings of this research revealed discernible differences between successful and unsuccessful firms. The founders of the successful ventures had more prior experience working together; tended to form larger, more complete teams; and had more extensive experience in the function they performed in the new venture. Successful founders also had experience in rapid growth firms that competed in the same industry as the start-up.The successful ventures targeted product-market segments with high buyer concentration in which, through technological advantage, their products could attain and sustain a competitive edge. Often this advantage was achieved by careful management of the product-development process, which resulted in early market entry and its corollary, reduced competition.On the other hand, some factors that the authors had predicted would allow them to distinguish between success and failure were not found to do so. Both successful and unsuccessful ventures targeted high growth markets, anticipated high gross margins, had founders with over five years of relevant experience, had experienced venture capitalists on their boards, and were characterized by a wide range of founder equity shares.     

Entrepreneurial visions in founding teams: Conceptualization,emergence, and effects on opportunity development

Prior research on entrepreneurial visions has typically taken a leadership perspective and explored how the founders’ future images of their ventures motivate themselves and followers. Drawing on an upper echelon perspective and longitudinal case studies of eight founding teams, this study finds that founders’ entrepreneurial visions do not only capture the future images of their ventures, but also the future images of the founders’ relationship with it. Taking into account this personal aspect of visions, we show that within a founding team, the members’ visions can be incongruent, i.e., they cannot be realized simultaneously within the current venture. While our data reveal that vision incongruence tends to occurs when all team members perceive to have an equal status, vision congruence emerges when the attributed status in the team is heterogeneous. Founding teams with more congruent visions tend to follow a focused opportunity development path, while those with less congruent visions tend to follow a comprehensive opportunity development path. Depending on the teams’ behaviors in the face of challenging situations either path can lead to successful opportunity commercialization or failure. We discuss the implications of these findings for the literatures on entrepreneurial visions, opportunities, and upper echelons.     

Reaping the financial and strategic benefits of a divestiture by spin-off

Because of their remarkable history of financial success, corporate spin-offs are the subject of perennial interest and investigation. We critically review quantitative and case-based research to determine the conditions under which a spin-off divestiture provides beneficial results for the conglomerate, the newly independent subsidiary, and the stockholders. The shared goal of spin-off researchers is to understand the rationale for the financial success that spin-off firms and their newly disconnected conglomerates experience. Our review and synthesis of the findings include 30 years of academic research by scholars in strategic and business management, commercial research by independent researchers and consulting firms, and IRS and US Treasury documents that detail when a spin-off qualifies for a corporate tax-free exchange. Our central finding is that spin-offs, conglomerates, and stockholders benefit from tax-free divestiture and subsequent refocusing by the companies. The article explains the breadth of spin-off divestitures and the benefits of their success in the US. These results center on helping decision-makers recognize the situational factors that support the choice of a spin-off strategy.     

Antecedents,moderators, and performance consequences of membership change in new venture teams

This paper focuses on initial team size and membership change of new venture teams in two studies: (1) a panel study of 408 emerging ventures, and (2) a cross-sectional study of 124 new ventures. The findings suggest that larger initial team size provides an advantage for new organizations, and that the benefits of adding and dropping team members are contingent on the stage of development of the organization and the dynamism of the environment. Both external environment and team composition factors are associated with turnover in venture teams.     

金融“脱媒”现象下的商业银行经营策略

本文通过分析美国的实际情况发现，随着资本市场的发展及多样化投资工具的日益普遍，商业银行的经营业绩并没有因为传统业务被挤占而一蹶不振，反而开创出了新的盈利空间。与资本市场形成了一种良性互动的发展态势。共同促进整个经济体系的持续增长。这全归功于美国商业银行的法人治理结构、业务运行模式及利润来源发生了根本性的转变。因而，对于处于变革中的中国商业银行而言。面临金融”脱媒”的影响。应该改革现有的产权制度，成立金融控股公司，转变业务运行模式及增加非利息收入来源。     

Impact of growth strategy on mode of governance in alliances

The aim of this study is to analyse the way in which growth strategies influence the choice of governance mode in corporate alliances. Specifically, the study looks at how expansion, diversification and internationalisation strategies determine choice of joint ventures rather than other types of alliances. To that end, we analysed a sample of 918 alliances among companies from the European Union-15 between 2000 and 2004. The results suggest that companies prefer to set up joint ventures when their strategies are based on expansion and related diversification, whereas they prefer other types of alliances when they follow a strategy of unrelated diversification. Furthermore, in international alliances, it appears that the impact of growth strategy on alliance governance mode is similar for the entire range of companies employed in the sample.     

Signaling for more money: The roles of founders' human capital and investor prominence in resource acquisition across different stages of firm development

We use signaling theory to explain how new ventures effectively signal future prospects to acquire external resources. Based on a sample of 235 new ventures drawn from a unique dataset combining multiple sources, we examine the signals of founders' human capital (i.e., education, industry experience, and founding experience) and investor prominence and their influence on the amount of external funding received across two stages of venture funding. We find that founders' founding experience and education have the greatest effects for acquiring first-round financing, but in later stages, only the signaling effect from education remains. Furthermore, we find important interactions between founders' human capital and investor prominence in the second round of funding. By utilizing lagged funding information, we show that different types of signals have a dynamic and temporal impact on new ventures' resource acquisition, including the persistence of some signals and the temporariness of others.