The Peripheral Halo Effect: Do Academic Spinoffs Influence Universities' Research Income?

Abstract

Extant literature has drawn attention to the 'halo effect' of the good reputation of a core organizational activity on the outcome of a peripheral activity. We contribute to the literature on organizational reputation by illustrating a halo effect in the opposite directionfrom the periphery to the core. We show that developing a reputation for a peripheral activity (in our context, universities' social impact via spinoffs) may have positive spillovers for core organizational activities (in our context, university research), a phenomenon we term the 'peripheral halo effect'. We also show that this effect is more prominent for high-status than for low-status organizations. Our research also contributes to the academic-entrepreneurship literature by revealing that spinoff portfolios can generate income for universities not only directly via equity positions but also indirectly via reputational benefits.

Unraveling the “passion orchestra” in academia

“…Specifically, while prior research points to the importance of researchers' personal networks, perceived role models, academic experience and engagement in applied research (Prodan and Drnovsek, 2010), as well as attitudes, perceived control, social norms and group identification (Goethner et al, 2012;Obschonka et al, 2012;Sieger and Monsen, 2015) for entrepreneurial intentions in academia, we complement existing research by identifying multiple passion(s) as motives behind academic entrepreneurship. Further, our distinction between spin-off and start-up intentions is important, particularly for universities and technology transfer managers because spin-off portfolios can generate income via equity positions or reputational benefits (Pitsakis et al, 2015), thus responding to policy makers' pressure to increase national competitiveness through academic research commercialization (Ambos et al, 2008). As such, understanding which and how different types of passion are related to intentions to found a firm based upon university research (i.e.…”

How academic entrepreneurship meets the university: university spin-offs in stakeholder networks

“…Third is explicitly acknowledging and championing the benefits which working with USOs brings to the university (Pitsakis et al 2015). This facilitates university-USO cooperation becoming a solution to individual problems faced by internal university stakeholders in achieving their own goals.…”

“…Universities' benefits also include indirect benefits from their wider stakeholder networks. Recent estimates show that about 13% of competitive research funding to universities in the UK can be explained by their USO portfolio (Pitsakis et al 2015). Understanding these wider entrepreneurial stakeholder networks benefits is critical to understanding why universities work with USOs.…”

Moving Ideas from Lab to Marketplace: A Guide to Research

“…Studies have also addressed how changes at one level of analysis can lead to changes at another. For instance, they show that science commercialization, in terms of university spin-off firms performing well, can influence the performance of the university in terms of higher research income [34]. Similarly, institutional changes at the university level may alter individuals' beliefs and behaviors [35].…”