Employee spinouts along the value chain

Abstract

While much of the academic literature on spinouts focuses on new ventures launched by the ex-employees of incumbent firms within the same industry, recent research shows that spinouts may also enter a focal industry from “knowledge contexts” outside of the incumbent industry. In particular, recent studies show that spinouts may enter from both upstream and downstream industries related to a focal industry along the value chain. Such spinouts have been called user-industry and supplier-industry spinouts. In this article, evidence from existing studies is collected to provide an indication of the relevance of such spinouts across various industries. This survey also includes an analysis of industry studies in which user- and supplier-industry spinouts may have been present but were not identified as such by scholars due to a difference in focus. The paper then considers the evidence accumulated to date in order to explore the industry contexts in which these two types of spinouts appear and to develop propositions concerning differences in the entry timing and product/market strategies of these startups.