Determinants of Regional High-Tech Growth by University-Based Start-Ups

Factors that influence the creation and developmentof innovative start-ups, particularly university-based start-ups, are examined.Previous research has found that reasons for creating academic spin-off firmsinclude perception of market opportunity, independence, presence of anentrepreneurial culture within the university, and the presence of varioustechnological and economic resources. In order to assess location factors and decisions for university spin-offcompanies, a survey was designed in the year 2000 which was given to more than1,000 university researchers from several technology regions worldwide. Resultsshow that foreign experience and use of the Internet information exchange iscommon for a large number of university researchers in successful technologyregions, and in particular for business founders and potential founders.Although such international activity among founders and the increase ofeconomic globalization might expand the location options for such start-ups, itis noted that researchers prefer to set up their businesses close to theoriginal research institution, where they have an established network. Why new knowledge-based firms might collaborate with foreign partners wasalso examined.Reasons include: (1) a transition toward the foreign marketwhen a degree of domestic market penetration is reached; (2) a prediction ofhigh transaction costs in high-technology industries; (3) a focus on thespecial resource requirements of new technology-based firms. A study on the importance of international business activities was conductedin June 2002 with 30 start-up companies from institutions in Jena, Ilmenau, andSchmalkalden, Germany.Results indicate that a majority of the firmsmaintain international contacts and the export of goods and services is themost vital activity. International and networking activities are important forthe success of a technology-based firm. (NEE)