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University Spin-Off Companies: Economic Development, Faculty Entrepreneurs, and Technology Transfer.

This provocative volume encompasses such topical areas as the university and economic development, university faculty as entrepreneurs, technology transfer pertaining to issues and initiatives, and turning university research into business opportunities. In fact, the Virginia Tech Conference was intended to provide participants with an understanding of methods for commercializing university-related technologies through spin-off corporations.

Part I relates to "The University and Economic Development" and includes Chapters 1, 2, and 3. In their analysis pertaining to "Global Economic Competitiveness and the Land-grant University," which comprises Chapter 1, John E. Cantlon and Herman E. Koenig remind the reader that there is "no such thing as a stable global economy." In essence, the basic thesis of this particular presentation is simply that the contemporary and future economic issues involve innovation, quality and cost control, entrepreneurship, and all that these imply socially, culturally, and technologically.

In the second chapter which is entitled "The Role of the Research University in Creating and Sustaining the U.S. Technopolis," David V. Gibson and Raymond W. Smilor convey the position that a high-quality research university or institute is a necessary but insufficient condition for the creation and maintenance of economic development in the technopolis |1; 2~. The essay includes a conceptual framework referred to as the "Technopolis Wheel" in order to facilitate the description of the complex nature of technological development and economic growth in the technopolis |2~. The chapter focuses on the central role of the research university in creating and sustaining a technopolis and includes investigative examples from a mature, a developing, and an emergent technopolis.

Chapter 3 pertains to "Socioeconomic Development Through Technology Transfer: Tecnopolis Novus Ortus" by Umberto Bozzo, David V. Gibson, Romualdo Sabatelli, and Raymond W. Smilor and conveys that during 1969 the University of Bari promoted the seeds of the technopolis concept in Southern Italy with the cooperation of Italian enterprises and local and national government. The creation of CSATA (Centro Studi Applicazioni in Tecnologie Avanzate) provided the initial step in forming Tecnopolis Novus Ortus.

Part II focuses on "University Faculty as Entrepreneurs" and includes Chapters 4, 5, and 6. The article by David N. Allen and Frederick Norling comprises the fourth chapter and is entitled "Exploring Perceived Threats in Faculty Commercialization of Research" and mentions the familiar downsizing of American industry. The chapter presentation deviates from the role of faculty in knowledge creation in order to examine its role in knowledge transformation.

The fifth chapter pertains to "University Technical Innovation: Spin-offs and Patents, in Goteborg, Sweden," by Douglas H. McQueen and J. T. Wallmark, in which the authors conclude that the message is clear that patent activity and outstanding research results do go hand in hand. Therefore, it is seemingly probable that the same positive correlations will be found between consulting activity and academic research, and between spin-off company formation and academic research; but detailed studies on these particular questions have yet to be completed.

The sixth chapter relates to "A Supportive Environment for Faculty Spin-off Companies" by James D. Morrison and William E. Wetzel, Jr. and emphasizes that "there is probably no single best way to facilitate the transfer of new ideas from universities to the commercial sector." The focal point of this chapter is on: The Venture Capital Network (VCN) which is a "dating service" that seeks to bring together inventors/entrepreneurs and informal investors, who are sources of first-stage venture capital in the $50-$75K range.

Part III pertains to "Technology Transfer: Issues and Initiatives" and encompasses Chapters 7 through 10. The seventh chapter, which is entitled "Technology Transfer by Spin-off Companies versus Licensing" by William D. Gregory and Thomas P. Sheahen provides an in-depth discussion of the advantages and the pitfalls of both the traditional licensing and the spin-off company form of research commercialization. Case examples are utilized in order to illustrate varying points of view.

The succeeding essay presented in Chapter 8 pertains to "Promoting University Spin-offs through Equity Participation" by Meg Wilson and Stephen Szygenda and concludes that Texas may be viewed as a laboratory for technological commercialization strategies. Equity participation by universities and their own spin-off companies is viewed as a very positive step by many policymakers, administrators, investors, faculty, students, and businesses. It may be some time before the University of Texas is able to conduct a more retrospective analysis of the experiment authorized with respect to the Center for Technological Development and Transfer (CTDT) which was created by state legislation in 1985.

Chapter 9 relates to "Ramifications of Operating a Business and Industry Development Center as an Auxiliary Enterprise" which is authored by Henry C. Kowalski. The GMI Engineering and Management Institute (formerly General Motors Institute) in Flint, Michigan, initiated the Business and Industry Development Center in July 1983. The author observes that GMI's experience shows that, under the proper set of circumstances, the resources of an academic institution can promote economic development within its constituency and community on a quid-pro-quo basis. There cannot be any general conclusions drawn, however, pending on the duplication of those unique conditions in other economic institutions.

The tenth chapter is entitled "The Breeder: Forming Spin-off Corporations through University-Industry Partnerships" by Frank J. Wilem, Jr. who observed that technological development requires the ingenuity of scientists and engineers who excel in their individual areas of research focus.

The fourth part focuses on "Turning University Research into Business Opportunities" and is comprised of Chapters 11, 12, 13, and 14. The eleventh chapter on "Technology Commercialization in Illinois" by Demetria Giannisis, Raymond A. Willis, and Nicholas B. Maher contends that the status of the United States as technological innovator and producer had been called into question even before it became a pivotal issue in the 1988 presidential campaign. In fact, the 1985 Presidential Commission on Industrial Competitiveness stressed the role of technological innovation, productivity growth, and human capital as structural indicators of competitiveness. The report's analysis progressed from the immediate context of "commercializing new technologies through improved manufacturing" to the extended context of reducing the federal deficit, improvements in school curricula, and revising the tax system to encourage innovation.

While the twelfth chapter consists of an essay by Ilze Krisst on "How University Research Results Become a Business: The Case of the University of Connecticut," the following chapter focuses on "Entrepreneurship at Purdue University" by Staley T. Thompson.

The final chapter, which is entitled "Conclusion" by Alistair M. Brett, David V. Gibson, and Raymond W. Smilor, mentions that even so the chapters in this volume certainly cover a range of issues, one theme is common to all of them: the search for effective mechanisms for launching and sustaining spin-off ventures. As the authors conclude, the need may be driven by a desire to form bridging structures to business and industries as described by Cantlon and Koenig, recognizing the university's economic development responsibility. Furthermore, the motivating force might be a desire to see direct commercial benefits from university research and development.

In the final analysis, the authors ponder how spin-off companies might support a nation's international competitiveness. In fact, since such companies are small, many have high growth potential and are based on critical technologies. In addition, strategic alliances with spin-off company partners in other countries may form a viable way for such ventures to contribute to the global economy. Bon appetit!

Jack E. Adams University of Arkansas/Little Rock

References

1. Smilor, R. W., D. V. Gibson, and G. Kozmetsky, "Creating the Technopolis: High Technology Development in Austin, Texas." Journal of Business Venturing, No. 4 (1988), 49-67.

2. -----, -----, and -----, eds., Creating the Technopolis: Linking Technology Commercialization and Economic Development. Cambridge, Mass.: Ballinger Publishing, 1988.
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Article Details
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Author:Adams, Jack E.
Publication:Southern Economic Journal
Article Type:Book Review
Date:Oct 1, 1993
Words:1264
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