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ETH spin-offs strengthen the Swiss economy

For the third time, the University of St.Gallen has investigated how productive spin-offs from the Swiss Federal Institute of Technology in Zurich (ETH) are. According to the results, these businesses generate far more jobs than the average Swiss start-up. In addition, they are taken over more frequently as well.

Spin-offs from the Swiss Federal Institute of Technology in Zurich (ETH).
Spin-offs from the Swiss Federal Institute of Technology in Zurich (ETH). Image Credit: ETH

Spin-offs from the Swiss Federal Institute of Technology in Zurich (ETH) play a crucial role in knowledge transfer within the Swiss economy. For this, they rely on indispensable support from universities. This is the conclusion reached by the third study into the productivity of ETH spin-offs conducted by the University of St.Gallen. As outlined in a press release issued by ETH Zurich, spin-offs affiliated with the university generated a total of 30 jobs on average. This is twice as high as other start-ups in Switzerland. Moreover, they are more likely to make what is known in the industry as an “exit”, with a takeover being the most common form of this. 

The most recent study is based on a survey of ETH spin-offs in 2018. This was then supplemented by publicly available data. Four categories were taken into consideration: HR factors, influence on the economy and innovation, financial matters and operational aspects.

Accordingly, 91 percent of the 500 spin-offs now in existence are still located in Switzerland, with the majority operating out of Zurich. An investigated group of 145 ETH spin-offs created around 4,500 full-time equivalent (FTE) jobs, which equates to 30 jobs per spin-off on average. For the first study in 2008, the equivalent value was only around seven full-time positions. The electrical engineering and electronics sector is the frontrunner in this category. It also responsible for the highest number of patents per firm. This is testament to the particular innovative capacity of this sector. However, biotech and pharma companies attract by far the greatest volume of investment.

The group analyzed, which comprised just over one third of all ETH spin-offs, generated sales totaling 900 million Swiss francs overall in 2017. Extrapolated across all ETH spin-offs, the University of St.Gallen estimates that the overall equity value is likely to be close to 10 billion Swiss francs. In total, 93 percent of ETH spin-offs successfully make it past the five-year mark. Since 2007, the proportion of women in the founding team of ETH spin-offs has risen, with this value currently standing at around 8 percent.

“It is pleasing to see how the spin-​off culture is continuing to develop at ETH Zurich”, comments Detlef Günther, Vice President for Research and Corporate Relations at ETH Zurich, in the press release, before adding: “We want to keep improving our support services for spin-​offs over the next few years – in close dialogue with the companies”.

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