Strategic alliances as a source of early-stage seed capital in new technology-based firms

A significant gap exists in early-stage seed capital for technology-based n ew ventures. This article reports the results of a survey of embryonic firm s in the southwestern United States that received significant amounts of th eir initial capital from strategic partners. Through this survey of firms, we have examined various characteristics of t he partnerships. The firms were identified through extensive research of mu ltiple sources (at least 30) such as universities, federal laboratories, st ate and local economic development agencies, incubator centers, technology parks, venture capital funds, NASA Regional Technology Transfer Centers, co rporate alliance partners, entrepreneurial networking organizations and by word-of-mouth from other entrepreneurs. Our empirical research findings identified the following key issues as sali ent to small-firm/large-firm, technology-driven strategic alliances formed for seed capital investment purposes: (a) Processes of strategic alliance formation; (b) Benefits accruing from strategic alliance formation; (c) Alternative market roles to forming a strategic alliance; (d) Governance processes of strategic alliances; (e) Alternative sources of funding to forming a strategic alliance; (f) Critical success/failure factors in strategic alliance formation. (C) 2 000 Elsevier Science Ltd. All rights reserved.