Federico Munari

Assessing the impact of public venture capital programmes in the United Kingdom: Do regional characteristics matter?

Over the last two decades, many governments around the world have implemented programs to mobilize venture capital (VC) in support of new and innovative firms. In this paper, we analyze whether and how the impact of publicly-supported VC funds varies between high-tech and low-tech regions, when compared to private VC funds. Our analyses on a sample of 898 VC-backed companies in the United Kingdom in the period 1998-2007 show for public VC funds: (a) a greater propensity to invest in early-stage and technology-based sectors, which is especially pronounced in low-tech regions; (b) a greater propensity toward staging and a greater ability to attract partners in syndication, especially in high-tech regions; (c) lower exit rates of investee companies, in terms of IPO/acquisition, as compared to private VC funds. Overall, our findings confirm that regional characteristics do matter if we want to more rigorously assess the effectiveness of public VC programs.

Privatization Processes and the Redefinition of Corporate R&D Boundaries

Although the economic and welfare consequences of privatization processes have been widely studied, less attention has been paid to understanding how these processes affect corporate research and development (R&D), and hence the innovative performance of the firm. We propose to address these issues by combining a policy level perspective with a firm level perspective centered around the role of corporate R&D and its changes. We use data from a few recent privatization processes to show how and by what processes R&D activities are affected in terms of amount and origins of funds allocated, scope of projects funded, and reliance on outside collaborations. In the light of these cases, we present a framework to characterize firm level effects of government divestment to guide managerial choices in restructuring corporate R&D and governmental action to proactively counterbalance post-privatization underinvestment risks.

What Determines University Patent Commercialization? Empirical Evidence on the Role of IPR Ownership

This paper addresses the commercialization of academic patents, developed in both universities and public research organizations (PROs). We distinguish between university-owned and university-invented patents to analyze if and how patent ownership affects the probability of commercialization and, similarly, if the characteristics of national university intellectual property right (IPR) regimes correlate with it. We study three commercialization channels—sales, licensing and spin-off formation—appearing in a sample of 858 university and PRO patents filed with the European Patent Office between 2003 and 2005 across 22 countries. To analyze differences in commercialization outcomes, this study employs a multivariate probit model. The results suggest that PRO ownership is negatively associated with the likelihood of selling the patent and creating an academic spin-off; university ownership positively affects the patents licensing uses. Finally, the institutional IPR regime has a negative effect on the probability of selling a patent.

The effects of privatization on corporate R&D units: evidence from Italy and France

Over the last two decades privatization programmes in a variety of different countries have radically reduced the role of the state as a major owner of productive assets. While there is empirical evidence to show that the switch in ownership generally improves productive efficiency and profitability at company level, its effects on research and development (R&D) activities, which can impact strongly on long-term performance, have been largely ignored in the literature. In this paper we address this issue by analyzing seven cases of privatization that have recently occurred in Italy and France in order to gauge how R&D activities may be affected by privatization in terms of objectives and organization. The organizations studied show that R&D units within privatized companies are subject to profound restructuring actions, generally designed to boost efficiency and to strengthen integration with the goals of the business units and of the final customers. A new role for R&D thus emerges: the aim is no longer to generate new knowledge in the broad national interest, but rather more directly to create value for the company and its clients, by emphasizing the assessment and integration of external knowledge.

The Economic Valuation of Patents

The Economic Valuation of Patents provides an original and essential analysis of patent valuation, presenting the main methodologies to value patents in different contexts.

Creative destruction? Evidence that buyouts shed jobs to raise returns

Building on the work of Cressy, Munari, and Malipiero (2007a) which showed that buyouts have higher operating profitability in the post-buyout period than matched companies, the paper examines contradictory popular claims that private equity (PE)-backed leveraged buyouts (LBOs) generate or destroy jobs as a result of the process of ‘rationalisation’. Using a sample of up to 57 UK whole-company buyouts and a matched sample of up to 83 controls over the period 1995–2000 we run loglinear employment regressions for one to five years after the buyout with buyout year variables as regressors. A PE dummy represents companies that have PE backing while other variables control for initial employment, gearing, investee size and profitability together with industry and macro effects. We find that there is no PE-‘choice’ effect: in the buyout year there are no significant differences between buyout companies and controls in terms of employment. But in the post-buyout regressions the PE dummy is highly significant and negative reaching a peak of 23% per annum after four years. So to achieve efficiency gains, buyouts bring about quick and substantial reductions in employment in target companies during the initial period of ‘rationalisation’. However, initial profitability, three-year average post-buyout profitability and three-year sales growth have positive elasticities with respect to future employment suggesting that buyouts, by generating higher operating profits from job cuts, may ultimately be associated with compensating job creation. This, however, is the subject for future research.

The Effects of Privatization on R&D Investments and Patent Productivity

Over the last two decades privatization programs in different countries have radically reduced the role of the State as a key player in the economic arena. We use agency theory to discuss the theoretical elationship between changes in the firms principal-agent structure following privatization, incentives to invest in R&D and R&D performance. We compare the pre- and post- privatization R&D effort and outcomes of 35 companies that were fully or partially privatized in the European Union through public share offers between 1980 and 1997. Our results show that, after controlling for inter-industry differences, the switch to private ownership leads to a decrease in overall R&D effort and to a ontemporaneous increase in the quantity of patents granted and in their quality, measured by the intensity of citations. Taken together, these findings support the expectation of increased innovation productivity following State divestment.

Financing technology transfer: assessment of university-oriented proof-of-concept programmes

ABSTRACT This study analyses the characteristics of the proof-of-concept (POC) programmes initiated by university and public research organisations in Europe, as a mechanism to address funding gaps and improve the transfer of research-based inventions to markets. We contribute to the literature on investment readiness of new ventures and on financing technology transfer by assessing the structure of such funding instruments and identifying critical success factors for their design and implementation. The analyses rely on seven in-depth case studies of university-oriented POCs in Europe.

Patent-backed Finance

The Economic Valuation of Patents provides an original and essential analysis of patent valuation, presenting the main methodologies to value patents in different contexts.

The Impact of Public Support for SMEs’ Patenting Activity: Empirical Evidence from Italy

Over the last decade, public patent subsidies have played an important role in several countries in enhancing international filings by domestic companies, especially SMEs. In this paper, we first analyze patent subsidies implemented in Italy from 2002 to 2012 and classify them according to four different typologies, based on their rationale and objectives. We then use data from a sample of 222 patents subsidized by the Chamber of Commerce of Milan in Northern Italy, and a control group of non-subsidized patents, to assess the impact of patent subsidies on patent value and firms’ turnover growth. We conclude by discussing policy recommendations for the optimal design of patent subsidy schemes.