Explaining the stage of product in pre-seed academic startup ventures: An empirical analysis using monitoring data from a German startup support program

Abstract

A central prerequisite for market entry and the subsequent economic performance of academic startup ventures is that the product on which the business model is based must be sufficiently well developed. The present research aims to provide answers in the quest to identify the explanatory factors in the development stage of the product of academic spin-offs in the pre-seed phase of their ventures. This is based on various factors that play a role in the innovation process and the development of new products – including characteristics of the project, characteristics of the R&D work and business model development, previous freelance experience, networking, financing, and technology field. The empirical analysis of data from academic startup ventures enrolled in a large German startup support program – using structural equation modeling – revealed both direct and indirect statistically significant effects, showing that a large proportion of the selected variables can be employed to explain the development stage of the product. The findings indicate that the R&D work stage has a medium-sized effect, while business model development stage, the degree of networking, project feasibility, and previous freelance experience connected with the product all have small effects.