When a university spin-off becomes an international success, the institution wastes precious little time claiming its share of the glory. The founders appear in speeches, promotional videos and annual reports; their company is presented as proof that the university turns research into wealth. Yet the publicity establishes only where the company began. It does not show how much the university actually contributed to what the founders built or whether they succeeded because of its support, despite its limitations, or largely beyond its reach.
A Ghent University-led study published in the Strategic Management Journal examined the performance of 3,164 academic spin-offs founded over a decade, originating from 212 universities in 99 European regions. Regional differences accounted for approximately 27% of the variation in return on assets and 16% of the variation in sales in the authors’ models. The effect attributable to the individual university was negligible.
That finding raises a question larger than whether universities exaggerate their contribution to individual companies. Are they claiming institutional credit for advantages supplied by an entire region? Investors, skilled workers, prospective customers and other firms all shape the environment in which a spin-off grows. The study does not tell us which of those factors drove any particular company’s success. It does show that performance varied substantially more across regions than across parent universities. As I argued in Europe’s Humiliating Exodus, Europe too often mistakes regional advantage for institutional excellence. A university that presents a successful spin-off as proof of its own exceptional capacity must therefore explain why the credit belongs chiefly to the institution, rather than to the wider ecosystem in which the company developed.
This does not make universities irrelevant. They may have produced the original research, trained the founders and helped the company get off the ground. But they did not, by virtue of that connection alone, hire every employee, secure every investment, win every customer or conquer every market. The temptation to claim the whole success is hardly mysterious: a study in the Journal of Management Studies found that spin-offs can cast a reputational “halo” over their parent universities and even benefit their research income. The company’s success becomes a university asset, whether or not the university can show how much it contributed to achieving it. Celebrate the founders, by all means. But if an institution wants credit for the company they built, it should provide evidence of its own contribution.
PS - I previously wrote about Sword Health’s acquisition of a German rival. It is the kind of international triumph that universities love to associate with their names. But who built the company, persuaded investors, won customers and made that acquisition possible? What, specifically, did the Portuguese university (U.Aveiro) contribute to those achievements? The European study cannot apportion credit for Sword Health. It does give us a reason to demand evidence before allowing any institution to claim an entrepreneur’s success as its own.
