ICECH2016 - ỉntenĩational Conference on Emeỉ-ging Challenges: Partnership Enhancement

START-UP IN UNIVERSITY AND THE UNIVERSITY-ENTERPRISE PARTNERSHIP

Dinh Van TOAN and Nguyen Phuong MAI1

Abstract

Start-up in universities and university - enterprise partnership is becoming a very popuỉar trend ỉn the world, especially in d e ve lo p ed co u n tries sin ce u n iversities p ro v id e abun dan t su p p ĩy o f ideas, kn o w led g e a n d tech n o ỉo g y f o r the Industries and societal needs, and at the same tỉme human resources, equipment and workspace are readily avaỉlable in universities. ưniversity has the role to create an environment o f innovation, and to encourage entrepreneurship. In retum, entrepreneuriaỉ activities heỉp to promote and tighten the effective and sustainabỉe connectỉon and cooperation between the university and enterprìses that contributes to the optimal utilừation o f university resources fo r socioeconomic development. In recent years in Vìeừiam, startup in universities is increasingỉy attracting attention from the relevant stakehọlders. Various programs, projects and initiatỉves have begun to be implemented wìth the expectation that more start-ups wilỉ succeed. This paper discusses the issue o f start-up in universities and its role to promote the cooperation between universities and enterprises. Based on theoreticaỉ arguments and the current síatus o f actuaì start-up activities in universities, the authors analyzed more cỉearly the contribution o f start-up in university - enterprise partnership. It is shown in this paper that the resuỉts o f start-up activities in Vietnam in generaỉ and in universitỉes in particular are very lỉmited, thus its role is stiỉỉ insubstantial. Notably, the authors suggest several/easibỉe solutions and recommendations aiming at promoting start-up activities, at the same time enhancing the effective parừiership between unỉversitỉes and enterprises in Vieừiam.

Keywords: Start - up in university, ưniversity - enterprise partnership

Tóm tắt

Khởi nghiệp và hợp tác vói doanh nghiệp tại cảc trườỉig đại học đang trở thành một xu hướng khả phổ biến trên thế giới, đặc biệt là ở các quôc gia đã phát triển, bởi các trường đại học luôn ỉà ngiiồn cung cấp dôi dào các ỷ tường, tri thức, và công nghệ phục vụ cho các ngành công nghiệp và nhu cẩu xã hội, lại là nơi săn có các nguôn lực về con người, trang thiết bị, không gian làm việc. Đại hoc có vai trò tạo mỏi tivờng đổi mới sang tạo, khích lệ tinh thằn khỏi nghiệp. Ngược lại, hoạt động khởi nghiệpgiủp thúc đẩy và thắt chặt hơn mối liên kết và hợp tác hiệu quả, bền vững giữa nhà trường với doanh nghiệp,góp phần khai thác tối ưu các nguồn lực cùa nhà trường cho sự phát triển kinh tế - xã hội. Tại Việt Nam trong những nâm gần đày, khởi nghiệp trong trường đại học đang ngày càng thu hút nhiều hơn sự quan tâm của các chủ thể cỏ liên quan. Một số chương trình, dự án và nhiều sảng kiến bắt đầu được triển khai với kỳ vọng ngày càng nhiều doanh nghiệp khởi nghiệp thành công. Bài viết này bàn vê vắn đê khởi nghiệp trong các đại học và vai trò của nỏ đối với thúc đẩy hợp tác giữa nhà trường và doanh nghiệp. Dựa trên các luận chứng lý thuyết và thực tế hoạt động khởi nghiệp trong trường đại học hiện nay, nhóm tác giả phân tích rõ đỏng góp của khới nghiệp trong hợp tác đại học - doanh nghiệp và đưa ra các kiến nghị nhằm thúc đầy hoạt động này, góp phần tầng cường hợp tác hiệu quả nhà trường và doanh nghiệp ở Việt Nam hiện nay.

Từ khóa: khởi nghiệp ứong trường đại học, hợp tác đại học - doanh nghiệp

1 School of Economics and Business (ƯEB), VNƯ Hanoi

ỈCECH2016 - ỉnteniational Conference on Emerging Chalỉenges: Partnership Enhancement

1. START-UP AND UNIVERSITY - ENTERPRISE PARTNERSHIP

1.1. University - enterprise partnership

The idea o f connecting university - enterprise was initiated by the German philosopher Humboldt Willhelm. According to Humboldt Willhelm, besides education, universities must also have the íimction of research and collaborate with industries. In 1810, he íòunded the University of Berlin with a diíĩerence from other universities at that time being that it shiữed its íòcus to research and made research a vital factor for education activities that contributes directly to social and economic development, especially the development of the íields of technology for both civiỉian and military purposes, contributing to Germany becoming the most powerful country in the world.

As the role o f technology in the development process becomes increasingly more important and has more positive contributions, the connection between universities and enterprises also becomes the development trend. Many universities around the world have studied ứie model that Willhelm Humboldt proposed to focus on developing connection and collaboration with the industries to form the development triangle: Government - ưniversity - Enterprise. Some íòrms of this partnership is presented inTable 1.

1.1.1. The roỉe o f each component in the university — enterprise partnership

In many countries, the competitive advantages of a number of major universities in combining education and research have created links between universities and enterprises; created the innovated system of three-dimensional spiral * model represents the relationship: govemment - university - enterprise. The development o f this relationship depends on the viewpoints and policies of the components mentioned above:

For the govemment: In developed countries, most economically beneíĩcial technological improvements are all related to universities through education, knowledge sharing and collaboration with industries. The connection facilitates universities and enterprises to jointly participate in research and development (R&D); thus the technological products of universities constantly increase, are commercialized and the role of universities for enterprises is highly regarded.

Govemments in developing countries often imitate developed countries in the formulation of national policies to promote research activities in universities, creating links among universities and between universities and industry. The development strategies of high quality human resources and technological innovation are promptly used by the govemment, which address questions such as: how much investment

for higher education, how to allocate budget for universities policies to support and encourage the universities and enterprises collaboration in R&D and the transference, commercialization of R&D results, which area of Science and technology that we need to íòcus on developing, the extent o f university autonomy, suitable policy system is critical for the universities competitiveness, creates strong linkage between universities and enterprises.

In the ƯK, since the 1990s the govemment has begun to take steps to encourage collaboration between universities and enterprises, as represented by the establishment of Department for Innovation, ưniversities and Skills (DIUS) and later became Department for Business, Innovation and Skills (BIS). In addition, organizations such as the Higher Education Innovation Funding (HEIF) and Research Councils (RCs) also are great sources of Capital support for the collaboration activities between universities and enterprises (Wilson, 2012).

For enterprises: The govemment policies ha ve a major impact on the development potential o f universities to conduct research projects. However, the decision to create partnerships and put them into practice is made by enterprises. In many countries, particularly ones with developed industry, R&D activities are usually only carried out by large enterprises. Small enterprises invest only a small amount o f Capital for research activities; focus on Products quality control system, Consulting services or set up some smali laboratories. With the aim of reducing research cost, expanding the scope of operations, opening up more technological development choices, large companies can choose to takeover small and medium-sized companies or cooperate with universities — research and application centers where they search for new knowledge, technologies and applications. Enterprises need the cooperation from universities to rapidly innovate technology, stay at the forefront o f R&D or to solve engineering, environmental and technological problems which reality poses with short completion time, aíĩòrdable cost and a solid team of professional (Tran Anh Tai & Tran Van Tung, 2009).

One of the large enterprises that have been actively investing in R&D collaboration with universities is IBM. As early as 1956, the Zurich Laboratory was established, dứectly organized and participated in numerous cooperation projects with universities throughout Europe. And in 2011, IBM along with Swiss Federal Institute of Technology in Zurich (ETH Zurich) established the Binnig and Rohrer Nanotechnology Center, with the main research goal of developing Nano structures to develop energy technology and míòrmation technology (AISBL 2012).

For the universities: The business environment, legal envừonment in industrialized countries or developing countries is the main reason forcing universities to

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hange the administrative management activities. ưniversities must commercialize research Products, natented inventions; connect to entrepreneurs to accomplish this goal. Traditional educators assume regardmg commercialÌ2ed goals too highly will make the quality of education fall and reduce the university rankỉng. But the facts have shown that most úniversities that are reputable in education are also leaders in research, technological transference. Thereíòre, the links between universities and enteiprises tend to be extended. In industrialized countries, there was even competition between universities to attract students, research resources, human resources for research and to cooperate with enterprises.

Ị. 1.2. Beneỳìts fo r university and enterprise

In today's world, knowledge and technology are the key factors to increase the added value, promote the development of production and improve the ability to meet the requirements of production and consumers. Meanwhile, universities are research and application centers, where people seek knowledge, new technology, new application. Therefore, the combination and cooperation between enterprises help to exploit the strengths of each party to operate more eíĩĩciently.

Enterprises that want to survive and thrive in a competitive environment need to constantly improve technology, product quality in order to reap the highest profíts. For enterprises to develop fast, sustainably and enhance competitiveness in the market, the important action is to search for inventions, patents, the Products of Science and technology that have feasibility (Ha Van Hoang, 2011). ưniversities oíten own the basic research results that enterprises need. For raany enterprises, the use of existing research results of universities on the basis of the research contracts will be the fastest way to bring eíĩĩciency to production and business activities, and at the same time be the least costly, rather than proceed to rebuild inửastructure or to organize research by themselves.

In addition, cooperation between universities and enterprises is considered the model of combined research and production, has been in developed countries successũilly applied. The fmal product of the research process is owned by parties, enterprise and university, to share proíits. In the course of this collaboration, enterprise can beneíĩt from the creation of new products with high competitiveness, and proíit when selling new Products to the market (Ha Van Hoi, 2011).

For universities, cooperation will promote and enhance the quality of researches, confirm the value of scientiỗc work, enhance the reputation and brand of the school. The research prọịects of universities will have a realistic environment for comparison and testing, thus the íurther increase their applicability in production. In addition, cooperation with other enterprises is the method to mobilize resources from

businesses to cater school activities such as competency building for staff, lecturer, and researchers through the collaborative research activities. Even the universities themselves were forced to innovate and adjust teaching and researching to meet the actual demands of society to provide opportunities for the transĩerence of research results to be faster (European Commission, 2007). The university students will then have broader career opportunity.

For enterprises, the cooperation with universities will provide the opportunity to obtain high quality human resources, meeting the demanđs o f business production; maximize mobilization of intellectual resources of universities to seize and innovate technology. Besides, the largest beneíit for enterprises when collaborating with universities is the revenue from the commercialization o f research Products, inventions originated from universities.

(Source: Rohrberck & Amoỉd, 2006)

The modem education experts, especially those in the ưs believe that cooperation between universities and enterprises is inevitable. The university with more valuable research programs will also attract good students and fiinding from companies. The innovation activities o f the university will help the local economy grow, create new jobs and attract talented people working in the íĩeld of Science and technology to the university. This link contributes heavily to the enhancement of competitiveness for universities and enterprises, while bringing huge beneíỉts to society.

1.2. Start-up in university and its role in university - enterprise partnership

Even though there is progress in the academic world regarding the interest for start-up research, there is no uniíying deíinition that precisely describes the start-up term. In fact there is no deíinition upon which two entrepreneurs or investors will agree on (Ries, 2011). However, many authors (Ries, 2011; Robehmed, 2013; Pope, 2014; Blank, 2013) connect the term start-up with the word “uncertainty”, or to be more precise: it is

Tabỉe 2: Motives for university - enterprìse partnership

University Enterprise

Promote education activities Search for modem technology

Financial resources/íunding Access to laboratory

Source of knowledge and verifĩed data

Human resources / cost reduction

Political pressure Risk sharing in basic research

Enhance credibility Stability of long-term research project

Job opportunities for graduates

Recruitment channel

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a new venture that tries to solve a problem where there is no obvious solution and no guaranteed success.

In addition, Blank (2013) defines a start-up as a “temporary organization designed to search for a repeatable and scalãbỉe business model”. This is a useỉul deíinition as it illustrates that a start-up is not simply a small version of a large and established company, it is instead a transient State an organization goes through when attemptmg to determine what the organization is going to do (i.e., what value or Service will it provide and monetize).

A start-up can be represented by any business that is created under conditions of extreme uncertainty whether it is for-profit, non-profit, venture-backed company or govemment agency.

Establishing a start-up in university is an emerging trend in recent years as a response to the demand of university-based entrepreneurial activity to enhance university - enterprise partnership. There are three main ways that universities motivate university-based entrepreneurial activity: (1) sell the rights to the innovation, (2) license the rights to the innovation, and(3) arrange for an equity positìon in the venture (Giannisis et al. 1988; Wilson and Szgenda 1988). In recent years, universities have shown a growing enthusiasm for the more risky forms of entrepreneurial activity, namely, forming start-up companies around a university-developed technology or licensing to small private firms rather ứian through the traditìonal commercialization route with large public companies. These companies in universities are so called university start-ups or spin-off companies.

The beneíits to the university of spin-off activities can be significant. Private ventures are becoming an important source of fimds for universities, especially in times when federal grantsYor research and enrollments in graduate schools are down (Doctors 1969). In 1987, licensing fees amounted to $6.1 million for Stanford University, $5.4 million for the University of Wisconsin, and $3.1 million for the Massachusetts Institute o f Technology Ợereski 1988). Doutriaux (1987) concludes that university spin-out companies are eíĩĩcient university-industry technology transfer mechanisms as well as a source of revenue. Spin-out companies, according to some, also provide a dynamic atmosphere for promoting established research results, a positive iníluence on emergent research, a positive iníluence on teaching, a fertile area for graduate assistants to conduct research, and an increase in the perceived presence of the university in the community (Rogers and Larsen 1984; McQueen and Wallmark 1988). Thus, the collaboration between university - enterprise is tightened when both parties reap beneíits from start-up activitíes in university.

To strengthen the cooperation with enterprises and the industry in general, universities implement the solution and diíĩerent methods of promoting start-up such as constructing technology incubators, establishing

start-up centers and technology transfering oÊBces (TTO). These activities are also known collectively as the supporting and promoting stait-up in universities activities, through which their role in strengthening the relationship between the two entitíes becomes more eỄBcient:

• Constructing technology incubators: with the roleof providing business incubation services for lecturers, staff and students, this activityencourages the establishment and development of enterprises using university technology. The services oữered often include renting out places for a điscount or even for free; help enterprises connect with íunding organizations, venture Capital and consultants; providing enterprise management services;

• Establishing Start-up Center: the task ofexpanding start-up training program for all students in the university, especially students of engineering, information technology and basic Science. Graduate students can participate inelective courses or courses on how tocommercialize theừ research results. Activities of the center will connect and build networks among enterprises, venture investors; grant newly established companies’ access to extemal venture Capital;

• Establishing technology transferring office. This oữice has closer relationship with irivestors, focusing on expansion of relationship and the promotion of technological results in in the market by prioritừe licensing patents for newly established enterprises. Through the support of venture activities, the program was implemented, allowing scientists, university students to commercialize theứ inventions and new ideas.

Other forms of promoting entrepreneurship in universities mentioned above are also meant to strengthen the cooperatìon between university - enterprise, will lead to the íòrmation o f start-ups in university and increase the likelihood o f success of these start-ups.

2. DISCUSSION AND MANAGERIAL EMPLIC ATION s

2.1. University - enterprise partnership in Vietnam

In Vietnam, the cooperation between universities and business is not anýứiing new. This issue has been raised many years ago in the vvritten statement and resolutions of the Communist Party and the Government: universities should be the centers of scientific research, technology transferring and application into production and life (Resolution of the 2nd Conference, The 8* Central Committee of the Communist Party of Vietnam); Implement strong cooperation between enterprises, establishments hữing

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employees, training institutions and the Government for the development o f human resources according to the needs of society (Economic development strategy 2011-2020, approved at the 11* National Congress of the Communist Party); regard enterprises as the center of applicable innovation and transference of technology, which is the most important demand o f the Science and technology market (Resolution of the 6th Conference, The l l* Central Committee of the Communist Party of Vĩetnam on development & technology to serve the cause o f industrialization and modemization o f socialist-oriented market economy and intemational integration). However, the implementation of the above policies still face many diữĩculties and the results are very limited.

Research results in 8 universities participating in the Profession - Oriented Higher Education Project deployed by the Ministry of Education and Training (POHE) showed that co-operation between universities and business has not been much developed. Most universities primarily establish a netvvork of only about 10 strategic partners. HCMC Nong Lam University was the only One that was able to establish strategic long-term cooperation with 120 enterprìses. The number o f enterprises with short-term cooperation clearly differ betvveen groups such as tìie group o f HCMC Nong Lam University, Vĩetnam Academy of Agricultural each has more than 100 partners, the average group like Hue University of Agriculture and Forestry, University of Technical Education of Hung Yen with 20 to 40 partners and groups such as the University of Vinh with only 4 partners (Doan Van Tinh, 2015).

For the students, it is worth mentioning that university- enterprise cooperation in practice plays an important role for job prospect after graduation. Survey results of nearly 1,400 alumni participated in POHE leaming showed that 72.8% thought they can meet the demands of employers; 75.5% said "the intemship is beneíicial for the current job"; 71.3% rated “the intemship is closely related to the actual current job". This helped the students to be self-confident, active and able to fmd a job matching theừ major after graduation. Survey data in 2013 at the Hue University of Agriculture and Forestry showed that 100% of students trained under POHE prọject have found jobs after graduation, are rated highly by the employers for professional capacity (National Institute for Science and Technology Policy and Strategy Studies, 2015).

A few large imiversities have more clearly shown the enterprise cooperation model and have seen results. These include 3 cases that have eữiciently deployed university - enterprise cooperation: Víetnam National University Hanoi (VNU), Hanoi University of Science and Technology (HUST) and Hue ưniversity of Agriculture and Forestry.

■ Vietaam National University has implemented ỉổectively three models: University - Institute from

VNU; Universities from VNU with research institutes, enterprises outside VNU; Laboratory model "phoi thuoc" links the University o f Technology from VNU with research institutes outside VNU. In the model that links with the enterprise, through the cooperation that was signed comprehensively with large corporations such as PeứoVietnam, Vĩettel, VinGroup and companies such as: Advance International Company (A1C), BRG Group..., scientists and other units under VNU deployed dozens of mạịor themes / programs / projects to serve the community.

- Cooperation betvveen the Hanoi University of Science and Technology and Rang Dong Light Source and Vacuum Flask Company in scientific research, technology transferring is a typical cooperation. This partnership has formed a variety o f themes and prọjects, thereby enhancing research capacity of the University, also contributed to the rapid growth of Rang Dong in manufacturing and trading. Currently, two parties have had many joint projects, including the prọject to build two joint laboratories (01 located in Rang Dong and 01 in Hanoi University of Science and Technology) that brings many practical benefits for both sides.

- Hue University of Agriculture and Forestry was one o f the first universities to be selected for the pilot training of the Profession - Oriented Higher Education Project (POHE) in 2005. Through this program, the University worked with over 500 domestic and íòreign enterprises (Laos, Cambodia, Thailand...), gave students the opportunity to dừectly participate in management, production, sales activities in the enterprises; increasing employment opportunities after graduation (Doan Van Tinh, 2015).

The content of cooperation between enterprises and university is still mainly ừaining, supplying high-quality labor from universities to enterprises through orders or recruited from enterprises. Cooperation in Science and technology is still limited and has not been able to keep up with the world. While over the world, cooperation in scientiíĩc research foilows the dừection: Universities take orders from enterprises, enterprises cover partly or fully the cost for the universities; Universities mobilize manpower to complete the order. The products created are placed under common ownership. Meanwhile in Vietnam, this cooperation is still spontaneous. Universitíes did not show initiation, the partnership is mostly made from the enterprises side (Ha Van Hoang, 2011).

The leaders of most universities are mostly not aware o f the importance o f the transference and commercialization o f products, technologies from research to enterprises, thus did not pay attention, did not proactively and positively promote cooperatìon with enterprises. In contrast, the university is not an attractive destination to seek innovation and creativity. The reason is that the research programs from universities primarily íimded by the Government; many research products are more academic in nature,

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not tied to the commercial applications. Therefore, enterprises rarely need to cooperate in the transfer and application activities.

A recent study of the company T&c Consulting (Vietnam) showed that most of these partnerships stem from immediate demanđs, short-term plans of the enterprise rather than their strategic long-term plans (78% versus 22%); the level of cooperation mainly in "understanding the early development" (214 out of 493 universities that enterprises "have collaboration with “and "short-term cooperation" with 174 out o f 493 universities; in particular, only 58 and 47 universities respectively are considered "long-term partner" and "strategic partner" of the enterprises (Nguyen Phuong Anh, 2014).

In terms of the structure of the mode of cooperation, universities mainly receive sponsorship and support from enterprises that do not yet have long-term programs, strategic cooperation between two sides. With the advantage of position and legal status, cooperation with enterprises of VNƯ brought in revenues of over 55 bilỉion every year in 2010-2015. However, over 70% is the íinancing of physical investment, scholarship support for students. Revenues from technology ữansferring contracts, production testing and commercialization contracts or applying the results o f research into practices account for a small percentage.

Overall, cooperation between universities and enterprises in Vietnam in recent time is still ửagmented, dependent on personal relationships and subjective will of the heads of two parties, no commitments have been created that are long-term and sustainable. The cooperation have not stemmed from shared Vision and strategy between the two parties. Leaders of the two parties and Ịiniversities alumni play the largest role in promoting cooperation.

The largest barrier of collaboration in Vietnam today is: the lack of iníbrmation from both sides. In addition, most enterprises said they did not have contacts with the universities (Nguyen Phuong Anh, 2014). The above results also showed: there is still a "white space" in cooperation between two partners. "White space" should not be understood in geographical terms but as the barriers to the initiative of cooperation, lack of mutual information; the parties have not directly participated nor actively demonstrated their role for each other.

Besides, the implementation of cooperation between the two sides was also made diổìcult by the Government inadequate administrative management mechanism: university autonomy unexploited in practice; decentralization of the university management as well as the administrative procedures of the Ministry of Education and Training and of the "goveming body" congested this cooperation. The models promoting cooperation between universities and enterprises such as establishing start-up or pilot production prọịect in

the university, constructing technology incubators etc. although have already mentioned in Government documented regulations, ứie lack o f promoting conditions regarding the legal environment and the operational mechanism of the university itself are the reasons why cooperation has not brought results nor being efFicient compared to the goal.

2.2. Start-up and its role in university - enterprise partnership in Vietnam

Start-up and entrepreneurial spirit has never been so concemed beíòre by the govemment, leaders, managers and enterprises. Deputy Prime Minister Vu Duc Dam in his speech "Promoting national entrepreneurship" at the workshop "Launching national start-up initiatives,l recently took place on March 30th, 2016 in Hanoi emphasized this. The Government is committed to continue to build mechanisms and policies to create the most favorable conditions possible for the enterprise commimity, incubators, institutions, ủinds related to entrepreneurship development:

- On May 18*, 2016, the Prime Minister has approved the scheme "Support for the National start-up ecosystems until 2025". The scheme aims to create a favorable environment to promote and support the formation and development of enterprise type that is capable of rapid growth based on the exploitation of intellectual property, technology, new business models developed by supports from the Innovation Partnership Program between Vietnam and Finland.

- Vietnam Innovative Startup Accelerator signed a memorandum o f cooperation agreements on the development of start-up activities at universities and high schools, including Hanoi ưniversity of Science Technology, University o f Technology- Vietnam National ưniversity, FPT ưniversitý and Hanoi Amsterdam High school. The signing event this time marked a milestone in the promotion of start-up for enterprises and the younger generation in Vietnam, especially in the context o f the year 2016 which was chosen as the Start-up Nation Year of Vietnara .

For universities:

- On June 15*, 2016, Lotte Data Communication Company has launched Lotte start-up support room at Hanoi ưniversity o f Science and Technology to support the students perform their startup aspừations;

- FPT ưniversity combined with High Technology Business Incubator Center (HBI), FPT Venture Investment Fund and the Netherlands Development Organization (SNV) oỡĩcially launched the program "START-ƯP UNI: Become a unipreneur" which aims to create a playing field that realize an entrepreneurship dream, the aspừations to change of the passionate and Creative students.

Over the recent decade, the start-up activities in universities in Vỉetnam have begun ío appear in many

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diổerent forms. Overall, universities that have partnered with many businesses are also those who represent the interest and activity of start-up. Two mạjor forms of start-up and start-up support in universities today are: forming start-up enterprises and building enterprise incubators.

2 2 1 . Ma ỉn forms o f start-up in university in Vietnam and current situation

- F orm ing s ta r t-u p s in un iversity

Start-up in university is íòrmed by the dừect and high level combination between training and usage, university and enterprise. The establishment of enterprises in the university will contribute to promote activities in the fĩeld of commercialization of knowledge, technology ừansíerring, patents, eđucational consultancy, attracting ủradings, etc. In addition, enterprises in universities also períòrm the íìinction of scientific research, technology transferring, broaden educational activities, creating links with industry.

Start-ups in universities have been íòrmed and operating in a number of universities in recent years, sũch as the Technology Investment and Development Company (BK-Holdings ) under Hanoi University of Science and Technology, Pharmacy Company under Hanoi ưniversity of Pharmacy, Construction Consultant ưniversity (CCƯ) of National ưniversity of Civil Engineering.

At VNƯ there are 3 enterprises: Tourism and Scientific Services Company at the ưniversity of Social Sciences and Humanities, Natural Sciences Company of the University of Natural Sciences, Microbiology Technology JSC from Institute of Micro-organism and Biotechnology Technology. The assessment results of the activities o f these three entprprises in the past 5 years show that: the enterprises services operation is eíĩective, generating income for the universities. However, activity that bridge between scientists and enterprises, loan organizations and potential investors of the Science and technology enterprises is very limited, thus the íunds to implement the transíer o f research results and applications in real-life and the proíit is not much.

- Building eníeĩ-piise incubation centers:

Practice has proven the important function of enterprise incubators as the link between the centers, research institutes, universities, govemment and enterprises (or groups of individuals) that intend to establish enterprise to create a “nurturing” environment for the start-up enterprises in a certain period so that enterprises can overcome the initial difficulties, confirming their existence and development as an independent enterprise. In universities, incubators more clearly underlining the role as a tool for promoting creativity, innovation, technology transfer and commercialization of successful technological ideas thanks to more closely relationships between:

ưniversity - institute - enterprise.

Starting in 2005, Vietnam has formed and developed some models o f technology and Science and technology enterprise incubators. Some models have been built and developed, íòcused in the two main centers o f Vietnam: Hanoi and HCMC. According to the authors, there are now 12 established incubators, úicluding 5 in the northern region and 7 in the Southern region, in which 4 are university incubators.

Table 3: Start-up incubation centers in Vietnamese universitíes

No Name Prioritizedarea

Status

1 HUSTIncubator

InformationTechnology

Discontinued

2 Technology enterprise incubator - HCMCAgriculture andForestryEducation

Agriculture,forestry andíĩsherymechanical,biotechnologyapplicationsetc.

Running

3 Technology enterprise incubator - HCMC ưniversity of Technology

Biotechnology, new materials, industrial IT

Running

4 Technology enterprise incubator - Can Tho ưniversity

Agriculture,íĩsheries,post-harvesttechnology,environment

Running

2.2.2. Major contribution o f start-up activities

From the actual operation of the start-up in universities and enterprise incubators in universities in Vietnam in recent years, we can see that entrepreneurship activities, including start-up, bring major results as follows:

- Creating and strengthening linkages, eữective cooperation between universities and enterprise: the establishment of start-up businesses or business incubators both has a common goal which is to bring the ideas of the research program into a speciíic product, to help inventors, inventors in universities have the opportunity to transfer theừ research and innovative ideas for businesses. Universities in Vietnam are places where Science research, human resources and facility, laboratory are readily available for scientific study. Start-up is the bridge of cooperation between universities and enterprises to transfer the results o f scientiílc research into business; enterprises ha ve address to connect to, share information on investment opportunities, a new product that has the potential to not invest now in research or experimentation.

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Although the nuraber of enterprises in the university is still small, these businesses also contrìbuted to promote the transfer o f research results to business. For example: Natural Sciences Company o f the ưniversity of Natural Sciences - VNU within 5 years from 2011 to 2015 has raade more than 90 technology transfer contracts and production test from the research trial production research carried out by the scientiíĩc staff of the school; Tourism and Scientiíĩc Services Company at the ưniversity of Social Sciences and Humanities - VNƯ aiso provides diverse services from using human resources for off-campus businesses thanks to the partnership.

- Fostering the spirit o f creativity, entrepreneurship in university: start-up is a method to realize the application of new technology, new product research for active companies that may not be willing to invest on the new, risky and unproven technology. In addition, start-up helps promote scientiíic research activities in the university. Scientists, students have more practical purpose and a higher motivation in scientiíic research. From good research topic, the students can establish the enterprise right when they are attending school.

Findings of Iníòrmation Technology Park in 2015 on the factors affecting entrepreneurship intention of IT students has shown: the percentage of students who want to start a business right from when he was studying is more than 80% of the respondents. More notably, 1 of the 3 most important reasons motivate students to start a business is because theừ start-up idea was sponsored by the investment fimds that own the ũinds re-created by enterprises. This shows that when businesses engage more deeply into university - enterprise partnership, they themselves have created a major driving force in promoting the entrepreneurship in universities.

- Activities of business start-ups bring revenues outside the govemment budget, diversiíy resources for universities: Natural Sciences Company of the University o f Natural Sciences r - VNƯ within 5 years from 2011 to 2015 brought the cumulative tumover of over 10 billion VND from technology transfer contracts, production testing; Tourism and Scientiílc Services Company at the University of Social Sciences and Humanities - VNƯ achieved cumulative revenue ửom 2011 to 2015 of more than 20 billion VND.

2.2.3. Shortcomings o f start-up promotỉon in university and some reasons

In addition to the strong points, start-up and stat-up incubation in univesities still have some shortcomings.

Firstly, there are only a few start-ups and start-up incubation centers which are not very eổicient. Two main reasons of the shortcomings are related to íinancial issues and legal framework.

It is diổĩcult to mobilize ĩmancial support to set up and maintain the operation of start-up incubation centers. The little íund from the State íòcuses only on land and

factories. At the same time, start-ups find it not easy to access íìmding institutions or venture Capital. The underdeveloped stock market is also another barrier for the growth of incubation centers.

Legal framework for the start-ups and incubation centers is one of the reasons for the limited access of these start-ups to the íiind. Although the govemment has set the strategic direction and issued some policies, the legal framework for university start-ups is still very poor with limited sphere of iníluence. Thus, there are not speciíic policy to establish and promote university start-ups and incubation centers. Even the concept of technology incubation center is not clear and legal. However, the govemment has committed to períect the legal framework by 2020 (as mentioned in the “National Entrepreneurship Incubation Eco-system by 2025”).

In addition, the insuíĩlcient awareness o f the role, íìinctions and socio-economic beneíĩts o f these incubation centers o f the community and even policy researchers and makers also decreases the eổectiveness of legal fìamework, and íinancial support from the business community for start-up incubation centers. Enterprise leaders lack the trust in problem solving capacity of the academia from universities. Therefore, business leaders are not ready to share ownership and partner with universities and vice versa. When universities are not active in partnering with the industry and sharing knowledge and patents, there will be negative eổects on start-up incubation centers and the growth of start-ups in university, particularly in the initial fund raising phase.

Secondly, the íorms o f start-up incubation centers are still limited. Most current incubation centers are technological centers, particularly IT ones. The reason is that IT is now the strength in technological transfer and implementation in Vietnamese universities. Another reason is the unclear regulations o f intellectual property and how to allocate related beneíỉts when a start-up is incubated successfiilly.

Thirdỉy, start-ups and incubation centers do not have suíĩĩcient expert network and professional services to promote incubation and foundation of start-ups. Most services to these newly established businesses are basic and at low level. Some incubation centers are awarded theừ legitimacy very late. Moreover, the staff working in start-up incubation centers is not fiill time employed but rather are part-time oíĩĩcers. Their time devoted to the incubation center is limited while the low salary leads to diổiculty in hừing fiiil-time professional managers for the incubation center.

The quality of selected enterprises for íunding is poor with too theoretical business plan that lacks the sense of real life. The managerial skills of the incubation center managers are insuổĩcien and fail to meet the demand of enterprises.

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2 3 Recommendations

Practical research shows that the university - enterprise partnership is still underdeveloped and far behinds its potentíal. These following recoommendations are proposed by the authors to remove the barriers that uiũversity enterpreneurship and its partnership with businesses is facing so that the two parties will contribute more to the socio-economic development Ũ1

Vĩetnam.

2 31. Recommendations for the Vietnamese govemment

It is necessary to improve the legal system that dừects and adjusts the university - enterprise partnership. The State has advocated promoting socialization in education that encourages private sector investment in eđucational activities; to increase autonomy and self-responsibility of the university; to encourage business to link with universities in training and collaborative research. Howevêr, to ensure that these activities will be promoted and to be eíĩective, the government must have a policy and speciíic guidelines. Õn one hand, the govemment should create a favorable legal framework for stakeholders, but on the other side they also speciíy the rights, responsibilities and methods of cooperation to avoid conílicts of interest, or the contradictions of development goals between two parties.

Moreover, the legal framework and mechanisms for the operation of the business start-up and now in college incubation centers should soon (even in 2016) be enacted to support entrepreneurship and innovation. The govemment should also gradually improved startup ecosystem associated wiứi the creation of an open space for research activities and development of the university and the scientists. In particular, the nniversity should pay concem to the elimination of the provisions, regulations administrative nature for the university, but instead is a mechanism to promote autonomy and social self-responsibility of the university.

There is separate íĩnancial mechanism, in accordance with the startup. Financing for starting a business include not only íinancial risk factors such as investment fưnds, which combine íinancial need through conventional banking system to effectively promote entrepreneurship. The combination of íĩscal or íinancial credit support to íinancial risks of investment íunds have been applied in many countries around the world. In the situation where the banks did not participate fiilly in this process due to place high priority on serving corporate íinance in the traditional way, the support of the State Fund is a suitable replacement.

There are national programs to expand the activities to promote entrepreneurship and enhance commercialization, combined with expanding access to Capital for entrepreneurs starting a business as the investment fund and support entrepreneurship

gorvemment's. This íimd should also be incorporated, in harmony with the private investment fimd in proportion depending on the risk level o f the start-up business. The combination with the private sector in investment to help mitigate risks to the govemment's budget.

Creating communication channel or network of links between business and universities, and to improve the program, the support mechanisms for innovative businesses. This is an issue that the two siđes have not yet been established. Even if there were business incubators are now also unrealized intermediary íunction because of the lack of iníormation about the possibilities and demands of each party at the national, sectoral and local areas. Channel or a network connection such as data collection, data updates, Consulting and providing iníòrmation, links model would be a good solution for the parties to easily find the right partner. But at the same time, advise the relevant authorities in formulating relevant policies. This is also the implementation of the connection kiende components startup ecosystem in order to build a solid foundation for the Vĩetnam generation new business, while promoting cooperation on innovation and launch now between Vietnam and other ASEAN countries.

2.3.2. Recommendations for both universities and enterprises

Firstly, both partisees need to change perceptíons and views on cooperation: the golden rule is "mutual understanding and mutual beneíits of cooperation". At the same time, it is also needed a ílexible operation mechanism and ílexible: the school and scientists should not only care about protecting intellectual property or patents, inventions; now the reverse is not too worried keep secret technology, Snancial mechanisms and investment policies; instead, should have the clue to establish íiỉll cooperation and information.

Secondly, the two sides should maintain regular communication channels through specialized department in charge of cooperation or through conferences, seminars, scientiíĩc fomms, collaborative projects so that both parties will understand and gain mutual trust through practical activities; actively share ideas, including the development strategy to build long-tenn cooperation and strategic partnership.

Thirdly, two parties should harmonize the beneííts of cooperation. Each party needs to be aware of the beneíits, respect and balance o f interests. Universities need to prioritize the ừansfer of technology, providing high-quality human resources and support businesses in solving business problems ữirough consultancy. Conversely, enterprises need to facilitate universities by oíĩering intership positions and Aeldtrip tours, recruiting new graduates. Enterprises should play the role of suppliers o f infonnatìon to the university so that they understand the needs of the labor market to update

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and improve the curricula and training methodology.

2.3.3. Recommendations fo r universities

Universities should pay much attentíon to íoundation of innovation and entrepreneurshìp as well as the procedure of setting up start-up incubation centers in a university. Especially, there should be motivators to promote students and young staff to be more entrepreneurial through activities such as Creative training methods, establishment o f entrepreneurship clubs, introducing information about the support from businesses.

Moreover, imiversities should íbrmulate policies and regulations of forms, motivators and resources allocation mechanism for the university - enterprise partnership. Researchers and academic staff should be encouiaged to get involved in start-up activities. Research results should be immediately transferred while the intellectuàl property is still protected through the registration with the authority so that universities will get back a certain amount o f money for reinvestment in R&D.

The database of business partners and a specialized department that connects with businesses and other partners should be developed. This department supports and cooperates with start-ups to access fund for R&D, production, IP exploitation and commercialization of research results. It is notevvorthy that this department should not work independently but closely connect with a network of school managers, lecturers and alumni, professional association, local authority bodies to search for potential business partners.

In addition, the technological incubation centers, technological transfer offices and start-up centers should be íòrmulated. Thẹge institutions will help start-ups, scientists and students to link with Capital sources, venture Capital and advisors and providers o f business administration services. They also provide the motivators for scientists and students to commercialize their research results.

Start-ups should be set up in form of partially or wholly ovvned by the university to exploit the research results and provide services of business ideas implementation. The company may be structured in two levels: (1) The "mother" company (the umbrella) which is under the control of the university will oversee the list of IP Products, (2) the statellite enterprises are íormed by existing research institutions in the imiversities to exploit the beneíits from the commercialization of research results.

Universities should also actively invited scientists and outstanding managers from businesses to participate in research and teaching activities. In addition, entrepreneurial academic staff should also be selected and traìned to participate in start-up projects and commercialization of scientiíĩc research.

2.2.4. Recommendationsfor enterprìses

Enterprise leaders shoulđ recognize that the strategic partnership with universities will serve tìieir long term beneũts. Thus, this partnership will not only about human resources development but also tìie exchange of entrepreneurial development and innovation ideas. It is vital for the enterprises to actively contact and get infonnation about the university.

Furthermore, the intemal regulations in enterprises should promote innovative culture to trigger the passion in business to create unique, differentiated and high-value Products by sứengtheming R&D activities. This is a must for Vietnamese enterprises to diíĩerentiate themselves in a hypercompetitive environment after the TPP protocol is signed.

Enterprises should also invest in start-up activities in universities through research cooperation, joint training courses and commercialization o f technological research Products. This kind of activity should be prioritized to bring them long term beneíits.

3. CONCLƯSION

University — enterprise partnership is becoming an indispensable trend and a self-actualization need to bring long term benefits and exploit the strengths of each involved partner. In this partnership development, the govemment play the role of a “midwife” who nuture the legal mechanism and other policy support to promote the tighten link between two parties. The triple relationship among goverament — university - enterprise brings about sustainable socio-economic development in each nation. In these recent decades, start-ups in university have drawn much attraction and is tightening the eữective partnership between university and enterprises. Tíirough partnership, start-ups are exposed to development opportunities, then the university start-ups when they gain success, will contribute to the close partnership bettveen both parties. The USA, some European countries and speciíic Asian countries such as Japan, Korea, Taiwan and China have gaine a lot of success from this partnership.

In Vietnam, university — enterprise partnership and university start-up in recent years are gaining much attention of different stakeholders in the society. The govemment has done a lot of eỡbrt to communicate the direction and expectation that universities and enterprises will be more actively in start-up activities. However, the reality is that start-up activities are still limited, cursory and not very diversiíied so that the benefits are much under the potential of each partner. Therefore, it is concluded that the slogan and dứection are not attractive enough. There should be more motivators and a more open mechanism for imiversities and enterprises to free all theứ resources to invest in innovation and entrepreneurial spirit.

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Main reasons for the slow development o f start-ups and start-up incubation centers include the aspects of all three partners: the govemment, university and company. For example, the universities and enterprises fail to deeply understand the other party in the partnership and do not focus on strategic partnership, particularly, enterprises do not believe in the commercialization of technological products from the university while researchers are not used to disseminating theừ research results. Start-ups and start-up incubation centers cannot easily access investment and limited venture Capital.

To capture the opportunity for long term partnership, there should be systematic, direct and urgent solutions. Recommendations in this paper aim at overcoming shortcomings of the policies and implementation issues from all three parties of the partnership. The govemment should perĩect the policy and regulation System to adjust activities of the start-ups and start-up incubation centers, to * develop an entrepreurship ecosystem with open space for R&D activities inuniversities. At the same time, universities andenterprises should also change theừ perception of partnership in accordance with strategic approach and develop intemal mechanism to promote innovation and entrepreneurship, be more active in ideas andinformation exchange to sưengthem competitive advantage of both parties in the context ofhypercompetition due to the integration process of the nation.

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[3] Fini R., Grimaldi R., Sobrero M. (2009), Factors íòstering academics to start up new ventures: an assessment of Italian founders’ incentives, Journaỉ o f Technology Transfer, 34, 380-402.

[4] Hà Văn Hoàng, “Họp tác phát triển khoa học và công nghệ giữa trường đại học và doanh nghiệp ở Việt Nam trong bối cảnh hội nhập”, Kỷ yếu Hội thảo quốc tế tại tĩ-ường ĐH Ngoại Thương, 15/11/2011

[5] Hà Văn Hội, “Hợp tác giữa Nhà trường và doanh nghiệp trong đào tạo, nghiên cứu: nhu cầu, lợi ích và biện pháp thực hiện”, Kỷ yếu Hội thảo quốc tế tại trường ĐH Ngoại Thưcmg, 15/11/2011

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[7] Pope, E. (2014). Here is the diữerence between a start-up and a small business. Available Online: https://blog.generalassemb.ly/difference-between- a-start-up-and-a-small-business/ [Accessed 20 March 2015]

[8] Powers J. B., Macs Dougle (2005), “Ưniversity start-up íòrmation and technology licensing with íĩrms that go public: a resource-based view of academic entrepreneurship”, Joumal o f Business Ventuhng, 20, 291-311.

[9] Ries, E. (201 Ụ, The Lean Start-up: How Constant Innovation Creates Radicaỉly Successfuỉ Businesses. Penguin Books Limited.

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[12] Rode, V., & Vallaster, c . (2005), “Corporate Branding for Start-ups: The Crucial Role of Entrepreneurs”, Corporate Reputation Review. Summer2005, Vol. 8 No. 2, pl21-135.

[13] Smilor R.w., Gibson D. V., Dietrich G B. (1990), “ưniversity spin-out Companies: Technology Start-ups from UT-Austin”, Journal o f Business Venturing, 5, pp. 63-76.

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[16] Wilson, DL (2012), A Review o f Business-Ưniversity Coỉỉaboraíion, Higher Education Funding Council for England

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APPENDIX 1

START-UP IN ƯNIVERSITY AND TIIE UNIVERSITY-ENTERPRISE PARTNERSHIP

Dlnli Van TOAN1, Nguyen Phuong MAI2*'Victnnm National University Hnnoi

5Univcrsity o f Economics nnd Business, Vietnam National University Hanoi ♦Correspoding author: mainp@.vnu.edu.vn

No P artn e rsh ip Form E urope Asla AustraliaUK German Italia Swcden China Singapore Japan

1 Enterprise accept univcrsity students as intems ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓

2

Enterprise provides tools and rèsources, technological equipmcnt for university tcachine and leaming

/ ✓

3Enterprise employs scientìsts ữom universities to \vork unđer fixed-term contract

/ ✓

4 Enterprise join university professional advisory board

✓ ✓ ✓

5Exploit coiĩunercial valuc from rcscarchcs under technology transferring contracts

✓ ✓ ✓ ✓

6 Construct Science and lechnology parks ✓ ✓

7

University establishcs companies (whoIly or partly owned) to invcsts in research, experiment, manufacturins test

✓ ✓

8 Ưniversity builds cnterprise incubation center / ✓ ✓

(Soarce; Aulhors analyiedfrom previous reỉated studies)

XÁC NHẬN CỦA BAN TỎ CHỨC HỘI THẢO ICECH2016 International Coiựerence on Emerghtg Chalỉenges: Partnership Enhancement

Table 1 trên đây là Bảng nằm trong nội dung bài báo có tựa đề “START-UP IN UNIVERS1TY AND THE ƯNIVERSĨTY-ENTERPRISE PARTNERSHIP” của tác giả Đinh Văn Toàn và Nguyễn Phương Mai in trong Proceedings of the 5,h International Conference on Emerging Challenges: Partnership Enhancemcnt, ISBN: 978-604-93-8961-0, tổ chức năm 2016 tại Trường Đại học Bảch khoa Hà Nội.

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