Early-stage Fundraising of University Spin-offs: A Study through Demand-site Perspectives.

Abstract

University spin-offs have increasingly received attention from academia, governments and policy-makers. However, there are only a limited number of studies which fully understand the contribution made by the founding team to fundraising, specifically how they use their social networks and capabilities, especially within the university spin-off context. Employing a resource-based view theory and social networks approach, this paper examines whether a founding team exploits its social networks and capabilities to signal the value of a university spin-off. Capabilities are analysed through a set of constructs - technology, strategy, human capital, organizational viability and commercial resource - that have been derived from previous literature. The contribution made by social networks is evaluated using three dimensions - structure, governance and content - which form the construct of relationships within a network. Based on data from 181 university spin-offs in Spain, this paper empirically demonstrates that by exploiting social networks a founding team can improve its capabilities which, in turn, enhance its fundraising ability.