Walking into the room with IP: exploring start-ups’ IP licensing strategy

Purpose: The purpose of this paper is to explore the trends and features of one of the most visible intellectual property (IP) management practices, IP licensing, in the context of start-ups, accessing external technology at the outset of their lifetime. In particular, it compares start-ups and incumbent firms, in terms of licensing strategy pursued, role of in-licensed technologies relative to the internal innovation process and successively implemented IP management strategies. Design/methodology/approach: A mixed-method study is presented using quantitative data on licensing deals from the US Securities and Exchange Commission and cases on start-up companies involved in inbound technology licensing. Findings: Evidence indicates start-ups have different IP licensing strategies than incumbents, and their successive IP management strategies are more flexible than for incumbents. Originality/value: The authors shed light on IP licensing, which is gaining momentum in open innovation (OI) settings, in an understudied segment of SMEs, namely, start-ups. The authors display interesting evidence of the portion of start-ups that license-in from external companies, indicating that this practice is more widespread than literature would suggest; the authors demonstrate that licensing-in is a valuable strategy for start-up companies, possibly providing additional channels for acquiring know-how on the market. The authors therefore contribute to, and advance, entrepreneurship, IP and OI literature.