Spin-offs and spin-outs: organisation building and the employment system resource endowments of universities

New firms founded to exploit university-based intellectual property have become an important international economic phenomenon. The rapid rise of spin-out companies at many universities around the world signifies an increase in interest by these universities in exploiting their technology. This reinforces the importance of understanding the dynamics and development of university spin-offs. While much of the recent research on university spin-offs have focused on resource endowments, business capabilities, capital, and environmental munificence of universities and their spin-off companies, little attention has been paid on the organisation building efforts and activities of the university-based entrepreneur or entrepreneurial team who initiate these start-up firms. Recent research suggests that as designers of these organisations (Burton 2001, Sarasvathy 2004), the role of the founders will be important in determining the organisation and form of the spin-offs. The majority of research-based spin-offs are founded by professional scientists and these organisations are characterised by high human capital density. As a result, the key imperative for these university entrepreneurs or entrepreneurial teams is to assemble and organise the human capital of their spin-offs. This paper examines the organisation building activities of founders in the building of the employment system of research-based university spin-offs