TY - JOUR
T1 - Are public subsidies effective for university spinoffs? Evidence from SBIR awards in the University of California system
AU - Fini, Riccardo
AU - Perkmann, Markus
AU - Kenney, Martin
AU - Maki, Kanetaka M.
N1 - Funding Information:
Much of the data analyzed here was provided by the University of California Start-Up Dataset created by the University of California Office of the President (UCOP). We acknowledge the assistance of Dorothy Miller and Rebecca Stanek-Rykoff of the UCOP. We thank Casey Castaldi for her research assistance and the UCOP for supporting this research project.
Funding Information:
Much of the data analyzed here was provided by the University of California Start-Up Dataset created by the University of California Office of the President (UCOP). We acknowledge the assistance of Dorothy Miller and Rebecca Stanek-Rykoff of the UCOP. We thank Casey Castaldi for her research assistance and the UCOP for supporting this research project.
Publisher Copyright:
© 2022 The Authors
PY - 2023/1
Y1 - 2023/1
N2 - This study examines the impact of public subsidies, and specifically, Small Business Innovation Research (SBIR) awards on university spinoff companies. Using unique data for a population of University of California spinoffs, we find pronounced differences between companies commercializing digital technologies (software and hardware), and those that focus on other product spaces. For digital spinoffs, receiving an SBIR award has a negative impact on raising venture capital and no impact on IPOs, exits or first sales. Conversely, for non-digital firms (e.g., biotechnology, energy), receiving an SBIR award has a positive effect on raising venture capital and performance outcomes. We reason that digital technologies are subject to faster cycle times and higher market uncertainty, relative to technological uncertainty. Digital firms may therefore benefit less from subsidies designed to support technology development, and private investors may view the need of digital companies to obtain such subsidies as a negative certification. Our findings inform policy by suggesting that the industrial domain may be an important boundary condition for the effectiveness of SBIR-type subsidies for university spinoffs.
AB - This study examines the impact of public subsidies, and specifically, Small Business Innovation Research (SBIR) awards on university spinoff companies. Using unique data for a population of University of California spinoffs, we find pronounced differences between companies commercializing digital technologies (software and hardware), and those that focus on other product spaces. For digital spinoffs, receiving an SBIR award has a negative impact on raising venture capital and no impact on IPOs, exits or first sales. Conversely, for non-digital firms (e.g., biotechnology, energy), receiving an SBIR award has a positive effect on raising venture capital and performance outcomes. We reason that digital technologies are subject to faster cycle times and higher market uncertainty, relative to technological uncertainty. Digital firms may therefore benefit less from subsidies designed to support technology development, and private investors may view the need of digital companies to obtain such subsidies as a negative certification. Our findings inform policy by suggesting that the industrial domain may be an important boundary condition for the effectiveness of SBIR-type subsidies for university spinoffs.
KW - Academic entrepreneurship
KW - Commercialization
KW - Digital technologies
KW - SBIR
KW - Technology transfer
KW - University spinoffs
KW - Venture capital
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U2 - 10.1016/j.respol.2022.104662
DO - 10.1016/j.respol.2022.104662
M3 - Article
AN - SCOPUS:85141920455
VL - 52
JO - Research Policy
JF - Research Policy
SN - 0048-7333
IS - 1
M1 - 104662
ER -
