The role of investors in developing academic spin offs: The biotech sector in South Africa
Høvig, Øystein Stavø; Pettersen, Inger Beate; Neethling, Adolph C.; Paschal, Brandon; Taxt, Randi Elisabeth
Journal article, Peer reviewed
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Date
2023Metadata
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Original version
The Southern African Journal of Entrepreneurship and Small Business Management. 2023, 15 (1), a738. 10.4102/SAJESBM.V15I1.738Abstract
Background: While research on commercialisation of academic research suggests that close interaction among academic entrepreneurs, technology transfer officers and investors can aid developing academic spin-offs, we argue that the role of investors is underdeveloped in the literature.
Aim: This paper aims to build new theoretical and empirical knowledge about the investor’s role in developing academic spin-offs. Focus is put on the interaction and dynamic relationship between investors, academic entrepreneurs and technology transfer office executives in academic spin-off (ASO) development.
Setting: The research is empirical in nature and conducted in the entrepreneurial ecosystem surrounding universities in the Western Cape area in South Africa.
Methods: The research is qualitative with a focus on conducting research interviews with knowledgeable respondents. Fourteen semi-structured interviews were used to collect data from investors and other stakeholders in the entrepreneurial ecosystem in the Western Cape area in South Africa.
Results: Four themes were uncovered. The study demonstrates a challenge of commercialising research-based inventions; both the team and the entrepreneur play an important role in the commercialisation process; investors can play a role in educating and coaching academic entrepreneurs and play a brokering role in attracting venture capital (VC) funding.
Conclusion: The study concludes that the pre-investment behaviour of investors, in relationship with technology transfer offices (TTOs) and academic entrepreneurs, may help mitigate assumed information asymmetries and uncertainty in ASO development.
Contribution: The research contributes to the literature by showing how investors’ perception, pre-investment behaviour and vision shape the development of ASOs in a dynamic interaction with technology transfer executives and academic entrepreneurs.