Promoting and supporting Spin-Offs
Spin-offs do not necessarily have to be promoted. As in the 1990s "core competence" became a buzzword, many medium-sized and large companies have axed numerous activities and laid-off many employees, many of which were subsequently contracted on a free-lance basis. Nevertheless, promoting spin-offs offers opportunities for local economic development, particularly in those places where medium-sized and large companies are located. It is not rare to find employees inside those companies who would much prefer to do what they do on a free-lance basis, except that they are fearing the risks and uncertainties involved. As many of these uncertainties involve issues such as legal status, financial status, tax issues, social legislation issues, and the like, a competent advisory service can do a lot to reduce uncertainties and thus remove barriers to self-employment.
A different issue is linked to a typical feature of large companies. It is not rare that employees inside a large corporation come up with viable product ideas, only to be frustrated by apparently innovation-resistant superiors. However, their resistance may be due to the fact that even though the idea may be viable, it does not make economic sense for the company. Stories like this seem to be not infrequent, for instance, inside chemical corporations: A development engineer develops a product idea to the point of pilot production, but the production volume would be no more than $ 2 million. For a large corporation, this may be too little to justify the effort. However, it may be a perfectly sound basis for an independent small business. Encouraging the engineer to start his own company may create a business which is creating additional jobs and tax income for the locality.
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last chapter: regional networks for start-up promotion
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