UNIVERSITY-GOVERNMENT BACKED VENTURE CAPITALIST STRATEGIC PARTNERSHIP IN THE FORMATION OF SPIN-OFF COMPANIES
Universiti Teknologi Malaysia (MALAYSIA)
About this paper:
Appears in: ICERI2011 Proceedings
Publication year: 2011
Conference name: 4th International Conference of Education, Research and Innovation
Dates: 14-16 November, 2011
Location: Madrid, Spain
Abstract:Recently Malaysian government has announced a New Economic Transformation Program (ETP) as a comprehensive effort that will transform Malaysia into becoming a high-income nation by 2020. In line with this agenda, universities in Malaysia are being urged to commercialize their R & D products. The Malaysian Technology Development Corporation (MTDC), the largest government back venture capital is collaborating with universities to transform their technologies into marketable products through university spin-off formations in a program called University Symbiosis Program (USP). Even though this is a government initiative program, the formation of the companies is perceived as complex and risky exercise. With high teaching and student supervisory loads, as well as being a researcher, academicians are not allowed to be CEOs of any company. Thus, this has restricted the mobility of the academic scientists to be a successful entrepreneur while at the same time they are obliged to fulfill their performance matrix imposed on them by the universities. Universiti Teknologi Malaysia is chosen as a case study in this paper to look into the process of spin-off formations between MTDC and a few chosen academics in the University. Ten patented technologies that resulted from various research programs in the University were selected. Also in conjunction with the program, ten surrogate young entrepreneurs were selected among CEOs of the spin-off companies to match the technologies from 178 applicants. The CEOs selections went through comprehensive processes. The result shows that, most of the inventors had entrepreneurial mind set and had been involved in consulting activities before they joint the program but some of the inventors lacked entrepreneurial mindset and only totally relied on MTDC on how to go about the setting up of their companies. However, all the CEOs of the companies showed they were very enthusiastic, energetic and were looking forward to move once the seed funding is granted to them. The spin-off formations gave a trickle-down effect in creating motivations to other scientists to form their own spin-offs. The future research also monitors the performance of these companies, the academics involved, and the CEOs.
Keywords: spin-off, academic-entrepreneurs, surrogate- entrepreneurs, venture capital, technologies.