The creation of technology-based firms, also known as spin-outs or start-ups, it is one of the main technology transfer way to bring research to the market and represents a strategic information intelligence source.

Here you can find a practical guide with key aspects and advising that support technology-based firm creation and development :

Types of spin-outs and start-ups

  • Scientific spin-outs:
    Spin-outs are created within another organisation, which can be a firm, an academic institution or a research institute. They are a spread-out mechanism to transfer applied scientific knowledge to society and are subjected to a constant developing legal framework.
  • Business start-ups:
    Startups are also coming from innovative business ideas, but they are not created inside an institution. These are knowledge-intensive and created to exploit new technologies, products, processes or services in the market. They tend to exploit a market niche with great potential, although also limited in time, but in a more agile, innovative and independent way.

Legal Spin-out framework and Policy

Scientific Spin-outs are subject to the national legal framework that affects its creation and development process. Mostly reflects in the participation of the research staff in the company’s share capital and governing bodies, their dedication and the technology transfer mechanisms involved. While this policy deals strictly with internal stakeholders, all parties involved should receive a reward that reflects the risks taken, and incentivises success. 

Conditions and requirements for Spin-out creation

To identify and protect an intellectual property asset is the basis for a company worth forming. These are the main issues that must be controlled:

  • Control a technology with commercial potential, mature enough (with high TRL) and a proven business opportunity in the market.
  • A leadership committed with the entrepreneurial project and a competitive, devoted and multidisciplinary team, both should combine technological development with business management. A strategic factor for investors.
  • Develop a novel, competitive and feasible business model based on the product or service.
  • Efficiently protect scientific knowledge as a source of competitive advantages and intangible assets.
  • Develop a novel, solid and plausible business strategy to access the market.
  • Develop a parallel networking strategy for the integration of the future company in the innovation ecosystem.

These strategic factors guide the stages of a technology-based company creation. The development of the spin-out requires an intense effort of strategic intelligence to market, key players and the business understanding. In addition, most universities and research institutions have support units to guide entrepreneur initiatives, as is the case of the UA: Emprende, University of Alicante entrepreneurship Program.

Entrepreneur Tools

The conventional business plan for the creation of technology companies is in constant development. The globalisation of scientific knowledge is creating an increasingly complex, changing and volatile environment. This obliges the application of agile and flexible methodologies and tools that allow business proposals with guarantees of survival and sustainability. The mostly useful entrepreneur tools are:

Technology intelligence represents a reliable information strategic tool for entrepreneurs. Therefore, in #MoocVT you will find modules and exercises such as the Technology Monitoring Canvas Model.

Funding Tools

The search for financing represents a decisive issue for all life cycle stages of a technology company. Hence, it is absolutely necessary to design a financing strategy since the business first stage, as well as participating in business rounds to raise capital.

Funding sources are structured according to the spin-out life cycle, according to its growth stage. In consequence, each business development phase involves specific problems with different financial requirements.

Source: EVUS technologies

The most common funding instruments in the early stages of a start-up /spin-out focus on the financing necessary to shape the business idea, such as:

  • Promotors and founders’ own funds, both contribution with knowledge, time and dedication to the business project when still there are no benefits.
  • Family, friends and fools: those people close to entrepreneurs willing to contribute with small amounts of money to develop the business idea.
  • Business Angels: generally experienced individual investors who inject capital into the startup business.
  • Accelerators: specialised organisations the promote competitions, prizes and facilities and can contribute both with capital and advice in the early stages of an entrepreneurial project.

The most common funding instruments for start-ups and spin-outs in the seed capital stage are oriented towards the development of a launching product and to make it survive in the market. The main goal at this point is to overcome the well-known “valley of death” and expanding financing options towards :

  • Venture capital: through professional companies, funds and investors.
  • Crowdfunding: with modalities such as equity crowdfunding where investors contribute capital in exchange for a stake in start-ups.
  • Funding rounds to raise capital: they are usually of different types depending on the capital that is intended to be raised.
  • Grants, loans and funding programmes.
  • Mutual guarantee companies to access loans in better conditions.
  • Participative loans, aimed at long-term financing investments, which can later be converted into own capital.
  • Self-financing: relative to those funds that are generated over the course of the start-up’s business activity.

Technology intelligence is also a needed tool for locating funding sources and opportunities in the creation of technological companies. Therefore, in MoocVT you will find more information regarding this issue.