The Performance of University Spin-Offs: The Impact of Entrepreneurial Capabilities and Social Networks of Founding Teams during Start-Ups

Objectives: University spin-offs have increasingly received attention from academia, governments, and policymakers because they not only generate new innovations, productivity, and jobs the regional economies but also significantly improve university productivity and creativity (Hayter, 2013, Urbano and Guerrero, 2013). However, a lack of understanding of the contribution made by a founding team to a spin-off’s performance still remains within current studies. Employing a resource-based view theory and social networks approach, this paper addresses this gap by exploring university spin-offs in Spain. Prior work: University spin-off studies have concentrated on analysing entrepreneurial business models (Ndonzuau et al., 2002, Vohora et al., 2004b, Bower, 2003, Mets, 2010) to understand how the commercialization of research is undertaken to create a university spin-off. University spin-offs were also been analysed from the perspective of a university’s capabilities (Powers and McDougall, 2005), or capabilities and social networks of an established spin-off instead of the founding teams (Walter et al., 2006). Moreover, Vohora et al. (2004a) and Shane (2004) have suggested founders need to build capable teams, which must have entrepreneurial capabilities and qualitative social networks, to create effective university spin-offs. Both entrepreneurial capability and social network theory have been studied in prior entrepreneurship research, but have received less attention within the context of the university spin-offs (Gonzalez-Pernia et al., 2013). Approach: Utilising an internet-based survey, this paper explores entrepreneurial capabilities and social networks of founding teams in Spanish university spin-offs using quantitative data analysis. Basing upon resource-based view theory of Barney (1991) to study entrepreneurial capabilities of the founding teams, the research employ entrepreneurial technology, strategy, human capital, organizational viability, and commercial resources (see Vohora et al., 2004a). To study social networks of a founding team, we employ the conceptual model of Hoang and Antoncic (2003) that divides networks into three components: structure, governance, and content. Results and implications: The results from an examination of the sample of 181 Spanish university spin-offs empirically demonstrate that by exploiting social networks a founding team can improve its entrepreneurial capabilities, which in turn enhance its spin-off’s performance. By employing the work of Vohora et al. (2004a) and Shane (2004), this paper constructs a model in which entrepreneurial capabilities play a mediate role between social networks and spin-off’s performance. Thus, the paper has implications for universities in training and policy development to support spin-off’s activity. Value: This study addresses some fundamental questions to contribute to the theory-based understanding of university spin-offs: How do entrepreneurial capabilities of founding teams influence the performance of university spin-offs? How do social networks of founding teams contribute to the process of the university spin-offs

Trust formation processes in innovative collaborations: networking as knowledge building practices

Purpose - This study examines the practices and processes of trust building and use in collaborative networking for product innovation and compares face to face with virtual networking. Design/Methodology/Approach – Guided by a literature review and preliminary participant observation, 16 open ended interviews collected data about the processes in 11 small biotech firms. These data were inductively analysed by the constant comparative method to develop explanatory themes. Findings – Trust was seen as requirement for successful collaborative innovation, but we identified how different dimensions of trust are located in the trust building processes. Trust works by creating a platform of confidence that fosters flows of information and the exchange of tacit knowledge. Two types of trust relationships, the technical and the social, work in different ways to produce different, but complementary, types of trust. Virtual environments suit technical trust building but are less suited to developing deeper, more enduring forms of trust. Originality/Value – The paper contributes conceptually by theorising the trust building process and its role in collaborative innovation. It addresses a gap in the literature in identifying how trust is produced, developed and employed in furthering innovation, in particular the behavioural patterns of using virtual networks in furthering innovation

Role of evolving Web Technologies in the discovery of Entrepreneurial Opportunities in technology-based organisations

Information and communication technologies are inspiring and enabling entrepreneurial endeavours yet our understanding of how entrepreneurial opportunities are discovered, especially influenced by the web technologies, is limited. The advent of web technologies (especially Web 2.0 and Web 3.0) has enabled the creation of internet giants such as Facebook and Twitter on one hand, while empowered the existing online businesses such as Amazon and eBay on the other. However, there is limited research that investigates the role of web technologies for entrepreneurial opportunities discovery (EOD). The findings of a systematic literature review reveal that prior EOD research has mostly investigated different factors such as prior knowledge, social capital and systematic search in isolation. Most of these studies did not investigate the role of technology in EOD indicating a dearth of research. The study used qualitative multiple case studies research methodology including semi-structured interviews, informal observations and archival review to collect data. The qualitative case study methodology was chosen because little was known about the phenomenon under investigation, and the purpose of the study was to develop a theory of entrepreneurial opportunity discovery in the context of web technologies. The research findings revealed several factors that influence entrepreneurial opportunity discovery in technology-based organisations and shed light on the enabling role of web technologies for EOD. The extensive data and information accumulated on the web can be exploited by companies to find entrepreneurial opportunities. The findings of present research can stimulate and encourage the use of web technologies for EOD, which has so far not been used to its full potential

Role of evolving Web Technologies in the discovery of Entrepreneurial Opportunities in technology-based organisations

Information and communication technologies are inspiring and enabling entrepreneurial endeavours yet our understanding of how entrepreneurial opportunities are discovered, especially influenced by the web technologies, is limited. The advent of web technologies (especially Web 2.0 and Web 3.0) has enabled the creation of internet giants such as Facebook and Twitter on one hand, while empowered the existing online businesses such as Amazon and eBay on the other. However, there is limited research that investigates the role of web technologies for entrepreneurial opportunities discovery (EOD). The findings of a systematic literature review reveal that prior EOD research has mostly investigated different factors such as prior knowledge, social capital and systematic search in isolation. Most of these studies did not investigate the role of technology in EOD indicating a dearth of research. The study used qualitative multiple case studies research methodology including semi-structured interviews, informal observations and archival review to collect data. The qualitative case study methodology was chosen because little was known about the phenomenon under investigation, and the purpose of the study was to develop a theory of entrepreneurial opportunity discovery in the context of web technologies. The research findings revealed several factors that influence entrepreneurial opportunity discovery in technology-based organisations and shed light on the enabling role of web technologies for EOD. The extensive data and information accumulated on the web can be exploited by companies to find entrepreneurial opportunities. The findings of present research can stimulate and encourage the use of web technologies for EOD, which has so far not been used to its full potential

Business networks SMEs and inter-firm collaboration: a review of the research literature with implications for policy

This literature review, which was commissioned by the UK's Small Business Service is concerned with business networks, and their importance for the small business community. Business networks are sometimes defined as comprising only inter-firm relationships (e.g. those that exist between component supplier and a manufacturer). However, it soon becomes apparent that a broader perspective is required, if research findings are to contribute meaningful insights for policy and practice. We have therefore incorporated research evidence on personal networks, notably those associated with entrepreneurship, and on links between firms and supporting institutions, such as trade associations, government agencies and universities

Social capital and engagement in Nigerian small business marketing.

This study explores social capital and engagement in Nigerian small business marketing. It examines how Nigerian small business owner-managers develop and use social capital in the network of relationships to overcome marketing constraints. Social capital can be viewed as a marketing asset available in network relationships. The process perspective of social capital enables understanding of the formation and use of social resources in networks. Social resources in networks are accessed through relationships built on trust and commitment over time. Although small businesses in Nigeria contribute to the nation's economic and social development, they operate under severe resource constraints. These constraints are mainly due to business size and limited resources, such as limited market impact, limited marketing skills and expertise, and limited access to resources. However, small business' inherent advantages, such as strong drive and enthusiasm, enable social connections with networks. This study builds on and develops engagement as an advanced form of relationship marketing in Nigerian small businesses. The concepts fit the context of a developing country with low resource availability and limited access to marketing resources. However, despite the increasing use of the concept "engagement", empirical-based understanding of processes underpinning engagement in small business context remains underexplored. A qualitative research approach is adopted to investigate the processes and dynamics of Nigerian small business owner-managers' engagement with various networks for marketing. The complex nature of the phenomenon requires a range of qualitative techniques for data collection and analysis to understand the meaning of small business owner-managers' actions during networking. Qualitative data were obtained through participant observation and semi-structured interviews with small business owner-managers in Nigeria. The thematic data analysis approach was adopted using the constant comparative analysis method to compare emerging themes and categories. This approach provides a description and understanding of data interpretations. It explains how Nigerian small business owner-managers engage with multiple networks in a long-term relational exchange relationship for marketing. The research findings identify engagement as a dynamic and iterative process resulting from network interactions, the strength of network ties, network interdependence and stability. This study's novelty lies in explaining the formation and use of social capital by engaging various networks in small business marketing. It further explores and develops the concept of engagement as a much stronger network relationship to involve networks in marketing. This study proposes a research model that explains the social capital formation and engagement processes of various networks in small business marketing. It develops and demonstrates small business marketing beyond transactions and offers theoretical contributions to the concept of social capital formation and use in small business engagement marketing. Finally, this study proposes recommendations for practice, theory and suggestions for further research

Investigating the antecedents to the adoption of SCRM technologies by start-up companies

Despite their fairly recent emergence, start-up companies now play an important role in the economic development of countries around the globe. These companies have fewer tangible assets and capital, and therefore, the efficient delivery of services and products is a key business priority for them. Customer relationship management (CRM) technologies, which are designed to facilitate customer engagement during the design, development and delivery of services and products may play a significant role in the success or failure of start-up companies. Developments in new communication technologies have transformed traditional CRM into electronic CRM (eCRM), mobile CRM (mCRM); and more recently, social CRM (SCRM). However, there remains very little understanding of the factors affecting SCRM adoption in start-up businesses. The relative newness of SCRM technologies, coupled with the swiftly evolving nature of start-up companies: which has made them difficult cases to study – has limited the amount of research undertaken in this area. This paper aims to close this gap by proposing a framework that depicts the factors affecting start-up companies’ intention to adopt SCRM applications, and explores the relative importance of these factors. Inspired by an extended Technological, Organisational and Environmental (TOE) framework, this paper investigates effects of technological characteristics (TC), organisational characteristics (OC), environmental characteristics (EC) and managerial characteristics (MC) on start-up companies’ intentions to adopt SCRM applications. The results outlined in this research indicate that the observability, compatibility and trialability of SCRM solutions positively affect SCRM adoption in start-up businesses. Moreover, the availability of internal financial resources has a similarly positive effect. When considering environmental characteristics, it was found that support from venture capitalists, crowd funding support, governmental support, business angels support and external pressure all positively affect the intention to adopt SCRM applications within start-up businesses

Institutional Change and the Evolution of Entrepreneurial Networks: A Comparison of Two Chinese Start-up Cohorts

Extant research provides contradictory views on the network adaptability of existing ventures and new ventures during environmental change. This research aims to resolve the controversies by comparing the network configurations and networking actions of two entrepreneurial cohorts during the course of China s institutional change after 1992. The qualitative and quantitative analyses show that existing cohort entrepreneurs display network inertia, in that they largely maintain strong tie based political and market networks; new cohort entrepreneurs instead demonstrate better adaption by establishing fewer political networks but more weak and diverse market networks. The dissertation further shows that existing cohort demonstrates a style of network deepening while the new cohort demonstrates a style of network broadening. This dissertation unpacks the institutional mechanisms underlying such differences. This dissertation also offers several implications for institutional research into network adaptation, as well as for research into entrepreneurship and networks

The Impact of Digitalisation and Entrepreneurial Networks on Business Strategy Development— a media richness theory approach

In the digital-based economy, digitalisation, entrepreneurial networks, and business strategy are three important interdependent components of the entrepreneurship process. Accurate, reliable, and timely information is also vital to the effective decision-making of entrepreneurs. Often, owing to limitations in their resources and capabilities, entrepreneurs rely on their entrepreneurial networks to satisfy their information need. The core objective of this paper is to examine the use of information in business strategy development and assess the role of entrepreneurial networks as information sources. The theoretical lens used in this narrative literature review is media richness theory. The findings of this paper show that entrepreneurial networks significantly influence entrepreneurial success and survival and that access to accurate and timely information enhances business strategy development

Overcoming liability of newness of international new ventures : the role of flexibility

Riding on the trend of globalization, a large number of new ventures have emerged deploying resources in multiple country markets so as to arrive at a competitive advantage. Studies that focus on such international new ventures grew to become a distinct research area: international Entrepreneurship that attracts much research attention but leaves a core issue namely liability of newness unaddressed. About 50 years ago, Stinchcombe (1965) coined this term to explain that most new ventures fail because their founders cannot switch their roles quickly enough to adapt to the changing environment. Although previous empirical studies have examined the entrepreneurial firms from the knowledge based view and organizational learning theory and tried to account for the varied ability of these entrepreneurial firms in switching roles in accordance of circumstances, little or no extant studies employs a Resource-based View (RBV) approach. This study will focus on INVs from emerging economics, trying to examine how INVs overcome liability of newness through “flexibility” to gain good performance during their internationalization. Based on the RBV of the firm, this study will address flexibility in form of a flexible configuration of firm resources consisting of cognitive, structural, and strategic flexibility as the predictors, arguing that these flexibilities would help INVs cope with liability of newness by fostering various dynamic capabilities that have been found to improve INVs’ performance. In addition, this study will focus on those INV firms located in industrial clusters, and examine how an INV\u27s network ties within an industrial cluster moderate the relationships among flexibility and the involved dynamic capabilities. This study collected a sample of 192 Chinese international new ventures, and structural equation modeling was used to test the full model. The findings demonstrate that: (1) all the three dimension of flexibilities have positive impact on international performance; (2) exploratory learning capability and adaptive capability mediate flexibility-international performance relationship while information acquisition capability does not; and (3) an INV’s network ties positively moderates both cognitive flexibility-information acquisition capability relationship and information acquisition capability-exploratory learning capability relationship while negatively moderates information acquisition capability-adaptive capability relationship. On the basis of current findings, implications and future research directions are drawn