The role of the top management team and board in academic spin-offs
Peer reviewed, Research report
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This report addresses the under-studied area of the role of the top management team and board of directors in the development of academic spin-off companies originating from universities and public research institutes. The questions addressed are as follows: • What are the distinctive team and board characteristics associated with successful academic spin-offs and what we can learn from this? (Section 5). • How can public government programs that aim to stimulate academic spin-off formation be designed, in order to take into account the important aspects of human capital in these firms? (Section 6). The findings show that boards in successful academic spin-off firms add value by bringing in necessary resources that the management team lacks. Additions of outside directors to the board are associated with a positive firm development. Larger and more active networking boards facilitate the recruitment of new people to the top management team. The board chair’s personal networks are important when finding new potential board members. Effective teams have members with diverse functional experience and industrial backgrounds. This diversity is associated with the firm’s ability to recruit new members to the management team and attract venture capital financing. The probability of attracting venture capital financing is also higher when an academic spin-off has previously received seed and industry capital financing. We recommend that policy makers develop policies that support the needs of academic spinoff firms to find professional outside directors. We also recommend that seed funds could make more investments in academic spin-offs and that more industrial schemes could be designed to stimulate greater involvement of industrial actors in academic spin-offs.
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