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This Article describes strategies vertically integrated electric utilities use to transfer value from rate-regulated affiliates to non-rate regulated affiliates. First, regulated utilities directly subsidize non-regulated affiliates by entering into favorable contracts with affiliates that participate in competitive markets. These contractual value transfers include favorable purchase agreements such as long-term contracts to buy coal at above-market prices and cross-affiliate debt guarantees that allow nonrate regulated affiliates to borrow at a discount. Second, utilities receive regulatory authorization to pass costs incurred by their non-rate regulated affiliates onto captive ratepayers. Examples of regulatorily approved value transfers are fuel adjustment clauses that authorize recovery of fuel costs from captive ratepayers and self-insurance that forces ratepayers to bear wildfire risk and transmission outages (even when insurance requirements are supposed to protect them from those risks). Third, utilities make investment decisions in rate-regulated markets that favor their non-rate regulated affiliates. For example, utilities may invest (or refuse to invest) in transmission capacity to protect the market power of their generation assets--not to reduce energy prices, improve grid reliability, or connect to low-carbon energy sources. Utility value transfers thus make the grid less efficient, less reliable, more difficult to supervise, and more resistant to policy instruments that should encourage decarbonization., INTRODUCTION 2130 I. HISTORY AND BACKGROUND OF UTILITY REGULATION 2134 II. CONTRACTUAL VALUE TRANSFERS 2140 A. Favorable Contracts with Suppliers 2140 1. Contracts with Suppliers 2140 2. Gas Precedent Agreements [...]

Section 355 of the Code permits a corporation that conducts multiple active businesses to distribute controlling stock ownership interests in one or more of such businesses to all or some [...]

When companies separate a subsidiary, or a collection of assets, the newly independent entity is referred to as a corporate spinoff. Spinoffs are common in Canada; many well-known companies began [...]

This article focuses on corporate spinouts as a strategy that can rejuvenate the inventive efforts of inventors with a long 1 tenure in the same company. We rely on an [...]

Although previous research shows that corporate spin-offs contribute to economic growth, few studies link growth to the type of corporate spin-off. We distinguish between three types of corporate spin-offs: incumbent-backed, [...]

The increased pressure put on public research institutes to commercialize their research results has given rise to an increased academic interest in technology transfer, We assess under which conditions tacit [...]

This paper presents the results and policy implications of a study that examined the spawning of founders who had previously been employed at large corporations. We found that spawning of founders is positively associated with the parent companies' productivity, innovativeness, and headquarter location. Furthermore, we found that the spin-off per employee rate is higher in smaller establishments. We also found that the local entrepreneurial culture is significant in explaining local spawning of founders. Finally, we present new empirical evidence on the crucial role of successful homegrown companies in regional cluster development. More specifically, we found that the existence of successful homegrown companies is significantly correlated with the level of the regional entrepreneurial activity. This finding is consistent with the finding of many cluster development case studies. Thus, we argue that successful homegrown companies have a unique role in cluster development. This role can seldom be replaced by nonhomegrown companies. This is related to the notion that prior to the development of an entrepreneurial cluster, some intangible precondition should be realized such as the appearance of local role models and a shift toward a more entrepreneurial culture. In a more general perspective, these results support the notion that knowledge-based regional development is a complex process that requires a long-term and continuously adjusting supporting policy rather than being based mainly on attracting established companies' R&D centers to the region. KEY WORDS: corporate spawning, spin-offs, founders, entrepreneurship, regional economic development, 1. Introduction Buffalo hunting to attract large established companies has become a well-accepted economic development strategy. The underlying logic is that large corporations not only provide immediate employment and knowledge [...]

Deutsche Telekom Laboratories took a spin-along approach in corporate venturing, where research and development results are commercialized through spin-out companies. Corporate venturing, a growth mechanism frequently used by multinational companies, can be internal or external. The effectiveness of the spin-along approach as an alternative innovation path is examined.

A Singapore-based economic geographer explores and analyzes the spatially uneven evolution of the Internet industry in China, arguing that the country's immense regional disparity in the provision of Internet services is best explained by the interplay of place- and path-dependence. The author demonstrates how the highly uneven regional endowments in relevant industrial and entrepreneurial resources have led to the substantial and persistent regional imbalance within China's emerging 'new economy.' His initial survey of the country's 100 leading Internet content providers (firms), identified from a listing of ca. 11,700 commercial websites, is selectively augmented to reflect an increase of over 70 million Internet users in 2007, reaching a total of 253 million in June 2008, and thus overtaking the United States as the world's largest Internet market. Journal of Economic Literature, Classification Numbers: L10, L86, 030.6 figures, 1 table, 53 references. Key words: Internet, China, place-dependence, path-dependence, Beijing, Shanghai, Guangzhou, Shenzhen, Hangzhou, co-evolution, spin-off dynamics, venture capital, guanxi, NASDAQ, Alibaba, Baidu, Sina, Sohu, Tencent, support networks.

Guidelines for planning and launching spinoffs and startups include observing small samples, testing business models using prototypes, tracking progress using non-financial methods, and establishing operating and corporate sponsors.

When a downstream producer enters backward into the input market, a 'helping the rivals effect' exists: Such entry hurts the firm's downstream business as it increases upstream competition and thus benefits its rival downstream firms. This negative externality prevents the newly-created upstream unit from expanding. A spin-off enables the firm to credibly expand in the input market, thereby forcing its upstream competitors to behave less aggressively. Spin-offs occur in equilibrium if and only if the number of downstream firms exceeds a threshold level. When there is more than one integrated firm, a spin-off by a firm can trigger spin-offs by others that would not occur otherwise. Keywords: Spin-offs; Commitment effect; Successive Cournot oligopoly; Multilateral negotiations

A study examining the rates of formation of new firms and their survival and growth, to chart the transformation of collective capabilities, is presented. Emerging and growing areas of local competence point towards the emergence of specialized labor markets. This emergence of cluster of firms is related to serial spin-out from the university and local businesses.

Entry by spinoffs from incumbent firms is investigated for the laser industry. A model in which spinoffs exploit knowledge from their parents is constructed to explain the market conditions conducive to spinoffs, the types of firms that spawn spinoffs, and the relationship of spinoffs to their parents. The model is tested using detailed data on all laser entrants from the start of the industry through 1994. Our findings support the basic premise of the model that spinoffs inherit knowledge from their parents that shapes their nature at birth. Implications of our findings for organizational behavior, business strategy, entry and industry evolution, and technological change are discussed. Key words: spinoff; entry; firm capabilities, 1. Introduction Models and metaphors from biological evolution are increasingly being used in the analysis of organizations (Aldrich 1999), business strategy (Barnett and Burgelman 1996), and industrial competition (Nelson 1995). [...]

Byline: Josh Lerner (1) Keywords: spin-off; venture; capitalist; entrepreneurship; venture capitals Abstract: This paper explores one of Edwin Mansfield's enduring interests: the interface between academia and industry. It highlights some key lessons regarding the management of university-based spin-outs, drawing on a variety of sources. I highlight the challenges that the spin-off process poses, the impracticality of directly financing firms through internal venture funds, and the ways in which universities can add value to faculty ventures. Author Affiliation: (1) Arthur Rock Center for Entrepreneurship, Harvard Business School, Room 214, Boston, Massachusetts, 02163, U.S.A Article History: Registration Date: 30/12/2004

Byline: Celine Druilhe (1), Elizabeth Garnsey (2) Abstract: This paper questions the widespread tendency to view academic spin-outs as an undifferentiated category and explores typologies of companies originating in universities, using a Penrosean conceptualization of entrepreneurial activity. We initially identified five main types of business activities pursued by academic entrepreneurs, which we revised after analyzing a database of Cambridge University spin-outs and real-time exemplars of emerging ventures. The refined typology takes into account the dynamic of the entrepreneurial process. As the business models of ventures evolve they may enter a different category of business activity. We conclude by discussing the academic and practical needs for a better understanding of the heterogeneity of spin-outs, the diversity of which has theoretical and policy implications. Author Affiliation: (1) Centre for Business Research, University of Cambridge, Judge Institute of Management, Trumpington Street, Cambridge, CB2 1AG, United Kingdom (2) Institute for Manufacturing, University of Cambridge, Mill Lane, Cambridge, CB2 1RX, United Kingdom Article History: Registration Date: 18/10/2004

Byline: Jean-Jacques Degroof (1), Edward B. Roberts (2) Abstract: We discuss the characteristics of academic 'spin-off policies' in environments outside of high tech clusters and where technology transfer and entrepreneurship infrastructures have been weak. We explore whether the policies could explain the lack of growth potential of spin-off ventures that have repeatedly observed. We studied the case of Belgium, gathering data from nine of spin-off policies in the eight largest academic institutions and in 47 firms. We propose that spin-off policies in academic institutions significantly affect the growth potential of ventures. Author Affiliation: (1) MIT Industrial Performance Center, 292 Main Street Room E38-104, Cambridge, MA, 02139-4307 (2) MIT Sloan School of Management, Cambridge, MA, 02139 Article History: Registration Date: 18/10/2004

Byline: Mike Wright (1), Ajay Vohora (2), Andy Lockett (1) Abstract: We explore the joint venture route to commercializing university owned intellectual property. We present comparisons between two spinouts formed as joint ventures between universities and industrial partners and two spinouts where this was not the case. The research employs a resource-based framework, with new high tech spinout firms (or firms in gestation) facing severe resource and capability constraints. We show that spinouts typically lack the financial means and managerial expertise to acquire the resources and develop the capabilities they need in order to fully exploit the commercial potential of their technologies. We argue that creating a spinout company as a joint venture with an industrial partner, may be a means of overcoming some of the potential problems associated with managing resource weaknesses and inadequate capabilities that may be difficult to achieve as a free-standing spin-out company with or without venture capital backing. Author Affiliation: (1) Nottingham University Business School, Nottingham University, Jubilee Campus, Wollaton Rd, Nottingham, NG8 1BB (2) Formerly Nottingham University Business School, Nottingham University, Jubilee Campus, Wollaton Rd, Nottingham, NG8 1BB Article History: Registration Date: 18/10/2004

Byline: Mike Wright (1), Sue Birley (2), Simon Mosey (3) Abstract: This paper argues that it is important to devote greater attention to the study of entrepreneurship in technology transfer in the light of greater government attention, the growth in the phenomenon, the need to identify how wealth can be created from spin-outs, changes in the cultures of universities and differences with technological entrepreneurship in general. The paper summarizes the contributions made by the papers presented in the special issue in terms of their levels of analysis. At the spin-out level, issues are raised concerning identification of typologies of spin-out firms, the evolution of spin-outs and external resources. At the university level, issues concerning policies, internal resources and processes are discussed. An agenda for further research is elaborated which relates to the need to examine further levels of analysis: the academic entrepreneurs themselves and how they recognize opportunities and shape their ideas to meet the market the nature of internal university environments, processes and resources and the nature of the scientific discipline which may have implications for the process of creation and development of spin-out ventures. Author Affiliation: (1) Center for Management Buy-out Research, Nottingham University Business School, Jubilee Campus, Nottingham, NG8 1BB, England (2) Imperial College, UK (3) University of Nottingham Institute for Enterprise and Innovation, Nottingham University Business School, Jubilee Campus, Nottingham, NG8 1BB, England Article History: Registration Date: 18/10/2004 Article note: Until 2003 at

Byline: Alessandro Grandi (1) Abstract: This paper deals with newly established ventures and their relations with external agents. The founding teams' intention to set up relations with external agents and their frequency of interaction with external agents are addressed as two features that are likely to lead to the success of academic spin-off companies. Empirical analysis is based on a data set of 40 Italian academic spin-offs. The external agents who are most likely to have interactions with academic spin-off companies are first identified. Two research hypotheses are then put forward: (a) that the intention of the founding teams to set up relations with external agents is influenced by the degree of articulation of roles and the completeness of the founding teams (b) that the founding teams' frequency of interaction with external agents is influenced by the frequency of interaction with external agents of the research groups of origin and by their scientific and technological excellence. Some remarks are then made on the role that universities play in helping new ventures to set up relations with external agents. Author Affiliation: (1) Department of Management, University of Bologna, Via Saragozza 8, 40123, Bologna, Italy E-mail Article History: Registration Date: 11/10/2004

Byline: Fabrice Pirnay (1), Bernard Surlemont (1), Fr&amp x00E9 d&amp x00E9 ric Nlemvo (1) Abstract: This paper discusses existing definitions of USOs in order to reconcile them and to provide criteria for classifying and understanding the different facets of this multi-headed concept. Drawing the boundaries of this concept and elucidating its variety through a typology are therefore the two main objectives of this paper. USOs are defined as new firms created to exploit commercially some knowledge, technology or research results developed within a university. The proposed typology is based on two key discriminatory factors, namely (1) the status of individuals involved in the new business venturing process (researchers or students) and (2) the nature of knowledge transferred from university to the new venture (codified or tacit), inducing the nature of the USO activities (product or service-oriented). Author Affiliation: (1) SME and Entrepreneurship Research Centre, University of Li&amp x00E8 ge, Boulevard du Rectorat 7 (B33), B-4000, Li&amp x00E8 ge, Belgium Article History: Registration Date: 11/10/2004

The variety of available investments in diversified firms can have an adverse effect upon these firms' value.

Companies often launch spinoffs to enter a market quickly. but the more sustainable strategy is to establish a group that is (or will be) integrated with their existing operations. People [...]

This paper provides an evaluation of the spinoff of a for-profit company from the American Institute of Certified Public Accountants (AICPA), a nonprofit professional association. The evaluation is based on a review of the literature on public policy issues surrounding organizational conversions from nonprofit to for-profit legal status. Many criticisms of this for-profit spinoff were voiced by professional leaders and accounting regulators, and we demonstrate that these criticisms are grounded in widely recognized policy principles relating to nonprofit conversions. The public policy issues raised by this study have implications for the governance of professional associations in all disciplines. KEY WORDS: nonprofit governance, nonprofit organizations, professional associations, professionalism, public policy

Byline: Dezie L. Warganegara (2) Keywords: capital mis-allocation; cash flow Abstract: In this paper, we try to show that mis-allocation of capital in a conglomerate can lead to spinoffs. This mis-allocation arises when internal cash is not allocated efficiently between divisions with differences in growth opportunities. We show that differences in growth opportunities can predict subsequent spinoffs. We also show that differences in growth opportunities are better predictors of spinoffs than either the SIC codes that are used in the corporate focus explanation of spinoffs, or the usual estimates of free cash flow as applied to the conglomerate. Author Affiliation: (2) College of Business Administration, University of North Texas, P.O. Box 305339, Denton, TX, 76203-5339 Article History: Registration Date: 04/10/2004

Byline: Younghoon Choi (1), Jang-Jae Lee (2) Abstract: This paper is a study of 127 firms participating in Korea's Technology Property Rights Concession Program, a program designed to stimulate technology transfer related to spin-off applications of public technology. The purpose is to identify the determinants of transfer success. The findings indicate that successful firms were motivated by the ability to access a core technology free of charge and to solve technical problems currently encountered in technology development. Second, the targeted technology was highly reliable. Third, interest in commercial success of the transfer was very high among the researchers involved in the transfer process and these researchers had a high degree of prior understanding about industrial problems on the part of participating firms. Relatedly, there was a very high satisfaction with the communication that existed between lab researchers and their industrial partners in the transfer process. Fourth, lab contributions to the transfer process were very high in the pre-commercial and commercial stages of technology development. Author Affiliation: (1) Institute for Social Sciences, Sung Kyun Kwan University, Myungryun-dong-3-ga, Chongro-gu, Seoul, 110-745, Korea (2) Institute for Social Sciences, Sung Kyun Kwan University, Myungryun-dong-3-ga, Chongro-gu, Seoul, 110-745, Korea Article History: Registration Date: 16/10/2004

Byline: Marco R. Di Tommaso, Laura Ramaciotti This paper is about academic Spin-Off (SO) in Italy. It offers an overview of the Italian debate both in academic and in policy-making circuits. First, national and regional policies are analysed. Second, universities practices are described. Then, the paper presents data on how this phenomenon has quickly grown in the last decade. Finally, in the concluding remarks, a list of controversial issues are highlighted.

Byline: Sven H. De Cleyn, Johan Braet The research domain of innovation and entrepreneurship is relatively young and fragmented. Therefore, no consensus exists on the definition of the main concepts. In a subdomain of entrepreneurship, this paper intends to both elucidate (the differences between) the concepts of 'spin-off' and 'spin-out' and, starting from existing literature taxonomies, to integrate several existing spin-off taxonomies, classifications and typologies in order to create a clear and complete framework for further research. This way, ten different 'ideal' spin-off and spin-out types will be defined, based on five distinguishing dimensions. These dimensions have been extracted from both theory and practice and relate strongly to the new venture's behaviour, strategy and performance. The resulting integrated typology will be illustrated in view of its practical and theoretical implications.

Byline: Sven H. De Cleyn, Johan Braet Scholar research seems to confirm that the type of funding of a university spin-off venture influences these survival chances. This study aims to investigate whether the basic type of funding used for young university spin-offs influences the survival chances. The reasoning is that screening by a previously independent party such as government agencies, business angels or venture capitalists provides additional evidence on the potential of a project or venture. The preliminary results, based on 16 case studies with Belgian university spin-offs, seem to confirm that successful application for government subsidies for the development of a technology, product or business increases the likelihood of venture survival. On the other hand, access to risk capital seems not to positively influence survival chances.

Byline: Lars Oystein Widding, Marius Tuft Mathisen, Oystein Madsen During the last decade, there has been an increasing focus on commercialisation from universities, often referred to as University Spin-Off companies (USOs). USOs are considered more profitable and survive longer when compared with other start-ups; however, they face major obstacles when seeking funding due to information asymmetry, uncertainty and the nature of their characteristics. The findings of this study indicate that USOs lack financing alternatives at early stages providing sufficient amounts of funding. In terms of bridging the financing gap, University-affiliated Venture Capital funds (UVCs) should be considered as an initiative to improve the financing situations for USOs.

Byline: Catherine Lecocq, Bart Van Looy, Edwin Zimmermann Universities can play an important role in rejuvenating the economic texture of a region by engaging in entrepreneurial activities. Stimulating the formation of spinoff companies can be seen as an important transfer mechanism in this respect. Spinoff companies originating from universities translate new scientific knowledge into economic activity. A majority of these spinoffs are focused and knowledge-intensive ventures confronted with the necessity to operate on a global market from their inception onwards. Such 'born globals' need specific capabilities in order to deploy market activities in an effective way. In this paper, we examine how a university Technology Transfer Office (TTO) can develop the necessary expertise to support the needs of knowledge-intensive spinoffs, taking into account the characteristics of the present regional and national innovation infrastructure. Building on the experience of several European universities participating in the GlobalStart initiative, an integrated approach is developed that aims to foster the support infrastructure needed to accommodate the specific needs of such knowledge-intensive spinoff companies.

Byline: Peter Van Der Sijde, Paul Kirwan The creation of new innovative enterprises, the support for spinoff companies and the development of startups are important priorities for the stimulation of economic growth, both within the European Union (EU) and worldwide. In the period of 1999-2006, a European programme, the Pilot Action of Excellence in Innovative Start-ups (PAXIS), dealt with these themes by gathering and transferring new ideas and policy recommendations throughout the continent. As part of this programme, universities and other institutions were invited to propose projects that developed original support models for innovative startup creation and transfer their successful concepts to other regions. One such project was GlobalStart. This preface introduces papers dealing with GlobalStart issues.

Author(s): Herb Brody [1] [illus. 1] The arduous nature of a career in science is not especially suited to the pursuit of business ambitions. Science's raw allure -- the intellectual [...]

Byline: David C. Mowery, Arvids A. Ziedonis This paper examines the role of Lawrence Livermore National (LLNL), a major US Department of Energy nuclear weapons research facility, in spawning 'spin-off' firms. We provide some of the most comprehensive estimates of the number of spin-off firms associated with LLNL and find that this research facility appears to be at least as important a source of spin-off firms as are three defence-oriented laboratories in New Mexico with a combined budget that is substantially larger than that of LLNL. Our survey of these LLNL 'spin-off' firms suggests that fewer than one-quarter of them are directly engaged in the commercialisation of LLNL-developed technologies, a finding that is broadly consistent with the results of other studies. Finally, our interviews with spin-off founders suggest that management and other policy-related impediments to the formation of 'spin-off' firms reduce the contribution of these firms to the commercialisation of LLNL-developed technologies.

The differences in investment behavior of companies before and after they have been divested are examined.

In a strategic move said to better serve its customer base, Alventive Inc. has spun off an independent company. The new company, IronCAD LLC, headquartered in Atlanta, will continue to [...]

* International TechneGroup Inc. (www.iti-oh.com) has formed TranscenData from its Product Data Interoperability business. TranscenData will provide global interoperability software. Compiled by Heather Gunter, Assistant Editor of Computer-Aided Engineering. Contact [...]

A new company in the highly competitive convenience food business must immediately establish the most exacting standards for product quality and performance. Request Foods, originally a division of Bil Mar […]

Venture capitalists have warned university entrepreneurs that they should wait for as long as a decade before considering spinning off companies, far longer than is currently common practice. Universities should keep these fledgling companies under 'incubation' for up to 10 years, rather than severing ties after only one or two years, if they are to attract the best investment and top-quality managers.

A team of chemists from Oxford University looks set to pocket millions of pounds from spin-off company VASTox plc, which has doubled its value to UKPd58 million in less than one year. The company, which develops drugs to treat rare diseases, was started two years ago by six scientists from the chemistry department at Oxford who invested UKPd100,000 in the company. The company was floated in October 2004 and valued at UKPd30 million.

Universities in the UK are significantly exaggerating the number of spin-off companies they are generating, according to a survey of enterprise activity in higher education carried out by Library House (Cambridge, UK). The report revealed that university technology-transfer offices were overestimating the number of spin-off companies generated by nearly 50%.

Hardware modeling revisited Though patent suits and corporate maneuvering may not be among the favorite subjects of engineering managers, they can have an effect on the products a manager buys. […]