Title: Early stage technology investments of pre-seed venture capitalists

Authors: Gunter Festel; Pablo Breitenmoser; Martin Würmseher; Jan Kratzer

Addresses: Festel Capital, Mettlenstrasse 14, 6363 Fuerigen, Switzerland; Technology and Innovation Management Start-up Research Group, Swiss Federal Institute of Technology Zurich, Scheuchzerstrasse 7, 8092 Zurich, Switzerland; Entrepreneurship and Innovation Management, Technical University Berlin, Strasse des 17, Juni 135, 10623 Berlin, Germany ' Technology and Innovation Management, Swiss Federal Institute of Technology Zurich, Scheuchzerstrasse 7, 8092 Zurich, Switzerland ' Technology and Innovation Management, Swiss Federal Institute of Technology Zurich, Scheuchzerstrasse 7, 8092 Zurich, Switzerland ' Entrepreneurship and Innovation Management, Technical University Berlin, Strasse des 17. Juni 135, 10623 Berlin, Germany

Abstract: Although technology transfer offices at universities are widely installed, in many cases, inventions made in academia still struggle to be commercialised. This so-called technology transfer gap can be overcome by professionalised pre-founding activities. Whereas prevailing investment models, like business angels or traditional venture capitalists, usually tie up their business activity on already founded companies, pre-seed venture capitalists (PSVC) attempt to align inventions made at academia with entrepreneurship by founding start-ups. Against this background, this study aims at examining the perceptions of deficiencies of the prevailing investment models and the role of the PSVCs in the pre-founding phase. PSVC companies operating in the biotechnology and nanotechnology area and with a broader technology approach have been analysed within a multi case study research. The results show that based on the technological scope and the financial source of the investment activity, four different types of PSVC business models can be identified and described. Technology transfer offices at universities and research institutions supporting the founding process of start-ups can use the findings to develop and execute specific partnership strategies with these PSVC types.

Keywords: new ventures; start-ups; spin-offs; business angels; founding angels; early stage investment; business models; pre-seed venture capital; technology investments; commercialisation technology transfer gap; biotechnology; nanotechnology; technology transfer offices; TTOs; partnership strategies.

DOI: 10.1504/IJEV.2015.073647

International Journal of Entrepreneurial Venturing, 2015 Vol.7 No.4, pp.370 - 395

Available online: 15 Dec 2015 *

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