A Spinning Streak: A Four-Dimensional Perspective on University Spinouts

Nicos Nicolaou at the Tanaka Business School, Imperial College London, provides a novel approach to the creation of university spinouts

• The characteristics of the entrepreneurial academic


• The nature of the technology


• The effect of legal factors, processes and institutions associated with national innovation systems


• The effect of regional influences (for a discussion of how university structures and policies affect the creation of spinouts, see reference 5)

The involvement of universities in commercialisation activities has changed significantly over the past hundred years. A historical overview would probably start with the case of Professor Frederick Cottrell who in 1907 set up a company to exploit his invention of an electrostatic precipitator that reduced air pollution (6). Cottrell decided not to involve the institution because he believed it was not appropriate for the university to become involved in the process, and was also apprehensive of industry involvement in university research (6). He founded an organisation, the Research Corporation, to oversee patenting and licensing activities, which by the 1930s began to manage these activities for many US universities (7).

In fact the Research Corporation very much shaped the post-1980 expansion in university/industry technology transfer (7). For example, Mowery and Sampat (8) argue that although the Bayh- Dole Act (1980) accelerated university involvement in patenting and technology transfer, “the ‘transformation’ wrought by the 1980 Act in fact followed trends that were already well established by the end of the 1970s” – the act allowed US universities to retain the rights to any patents arising from federally funded projects. Nevertheless, as a result of the Bayh- Dole Act, the number of technology transfer offices in the US increased from 25 in 1980 to over 200 by 1995 (7). A historical overview would be incomplete without mentioning the importance of biotechnology, which significantly altered the character of university/industry interaction in the late 1970s, and led to academics leaving the university when founding companies (9).

For example, David Jackson, tenured Associate Professor at the University of Michigan, left academia to found Genex in 1977 (9). The growth in biomedical research also contributed to the universities’ increased involvement in commercialisation and spinout activities, as university patents became particularly concentrated in biomedical areas (10,11). Moreover, the growth in spinouts has also been consistent with contagion and rolemodelling effects, as well as with the increase in the availability of venture capital and business angel financing (11). The characteristics of the entrepreneurial academic, the nature of the technology, legal factors and processes and institutions associated with national innovation systems and regional influences all significantly affect the creation of university spinouts.