Complements or substitutes? An empirical analysis of the role of Universities and local context in supporting the creation and growth of academic start-ups

none4The important role that academic spin-offs have in supporting economic and technological growth has been widely acknowledged (Shane, 2004). Universities - aware of the contribution that these companies can give to economic and technological development - have been increasingly supporting their creation and growth. However, the modalities/mechanisms through which universities may effectively intervene and offer support to academic spin-offs have not yet been fully explored (Wright, Birley, & Mosey, 2004), nor are previous studies clear about the (additional) contribution that universities offer to spin-offs, when considering the specificities and incentive/support mechanisms available in the local contexts in which they operate. In this paper, we tackle this important issue for policy makers and university administrators by analyzing the impact that University-Level Support Mechanisms (e.g. specific internal regulations, business plan competitions, university affiliated business incubators and availability of university venture capital funds) have in fostering academic spin-offs’ growth and the way they interact with other forms of support mechanisms, such as Local-Context Support Mechanisms (e.g. availability of public and private research institutions, venture capitalists, business angels, companies operating in the same sector, incubators and science parks) available in the regional context in which spin-offs operate. Scholars have documented that universities, in particular, and society, at large, can successfully benefit from the commercialization of advanced knowledge only when the local context in which they are settled is ‘fertile’ enough to leverage on academic resources and can offer infrastructure and financial inducements. The key is that communities surrounding universities must have the capabilities to absorb and exploit the science and knowledge that universities generate. The rationale is that, even though new knowledge is generated in many places, it is only those regions that can absorb and apply ideas that are able to turn them into economic wealth (Florida, 1999). These arguments suggest that university-level mechanisms alone might not suffice. Academic spin-offs, in order to grow, should be able to exploit and combine their resources and competencies with external ones and to grasp opportunities offered by the local context in which they operate (Mowery, Nelson, Sampat, & Ziedonis, 2001). On the one hand, wherever market-level inefficiencies arise, universities can play an important substitutive role, and even when local contexts are well-developed and rich in opportunities, universities find internal incentives to support academic spin-offs and leverage positive network externalities. Problems might arise, however, when public support is given to universities for promoting academic spin-offs in well-developed economic contexts, as such resources might be redundant and their effectiveness questionable. In order to investigate this issue, in our contribution, we contrast the importance of university-level and local-context support mechanisms for academic spin-offs under different levels of local economic development, assessing their impacts on spin-offs’ growth. In our study we target the Italian population of 586 academic firms, spun-off from the 107 Italian PROs. Through the PROs websites and the two existing databases RITA (Colombo, Del Mastro, & Grilli, 2004) and OSIRIDE (Fini, Grimaldi & Sobrero, 2009), we retrieved the contact information for each company (e.g. names, telephone and e-mail). We then adopted a two-pronged data gathering approach. We first collected primary information through an electronic survey send to the firms’ population. Specifically, we collected company general information, innovative and market performances, as well as structural and financial supports received by both the context and the parental institution. We also collected data on firms’ social and human capit...noneFini R.; Grimaldi R.; Santoni S.; Sobrero M.Fini R.; Grimaldi R.; Santoni S.; Sobrero M