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December 2018 (published: 27.12.2018)
Number 4(35)
Home > Issue > Usage of spin-off companies in the scheme of financing innovation activities
of industrial enterprises
Sergeeva I.G., Tretyakova E.A.
In order to enhance the innovation activities of enterprises, it is necessary to create incentive schemes for financing these activities. The article presents a comparative analysis of existing models of financing innovation activities in order to determine the possibility of their use for financing innovation activities of industrial enterprises. Various models are used to finance innovative projects, such as venture financing, business angel funds, and crowdfunding. The article examines the scope of application of various financing models, the possibilities and limitations of their usage in the innovation business. As a possible financing scheme for the innovation activity of the operating industrial enterprise, it is proposed to create spin-off companies using material, labor and other available resources of the parent company for the implementation of innovative projects. Under this financing scheme, the parent company gets opportunities to diversify activities with sharing risks, implementing a phased financing of an innovative project, and increasing susceptibility to innovations. In turn, a spin-off enterprise at the initial stage of its activity can use material resources, management experience and connections of the parent company, access to the necessary financial resources is simplified. To assess the effectiveness of the company's spin-off innovation, it is proposed to use the «with-without» principle, which compares the company's results achieved in practice, taking into account the launch of the company's innovative spin-off, and theoretically possible when carrying out current activities without introducing innovations. If we consider the dynamics of this ratio for a certain time period, it is possible to identify the presence or absence of a synergy effect when launching new spin-off enterprises.
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Keywords: financing models, innovation activity, spin-off company, venture financing, crowdfunding.
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License
UDC 336.64
Usage of spin-off companies in the scheme of financing innovation activities
of industrial enterprises
In order to enhance the innovation activities of enterprises, it is necessary to create incentive schemes for financing these activities. The article presents a comparative analysis of existing models of financing innovation activities in order to determine the possibility of their use for financing innovation activities of industrial enterprises. Various models are used to finance innovative projects, such as venture financing, business angel funds, and crowdfunding. The article examines the scope of application of various financing models, the possibilities and limitations of their usage in the innovation business. As a possible financing scheme for the innovation activity of the operating industrial enterprise, it is proposed to create spin-off companies using material, labor and other available resources of the parent company for the implementation of innovative projects. Under this financing scheme, the parent company gets opportunities to diversify activities with sharing risks, implementing a phased financing of an innovative project, and increasing susceptibility to innovations. In turn, a spin-off enterprise at the initial stage of its activity can use material resources, management experience and connections of the parent company, access to the necessary financial resources is simplified. To assess the effectiveness of the company's spin-off innovation, it is proposed to use the «with-without» principle, which compares the company's results achieved in practice, taking into account the launch of the company's innovative spin-off, and theoretically possible when carrying out current activities without introducing innovations. If we consider the dynamics of this ratio for a certain time period, it is possible to identify the presence or absence of a synergy effect when launching new spin-off enterprises.
Read the full article
Keywords: financing models, innovation activity, spin-off company, venture financing, crowdfunding.
DOI 10.17586/2310-1172-2018-11-4-46-51