Spinoffs versus buyouts: Profitability of alternate routes for commercializing innovations

This research compares the performance of spinoffs and buyouts divested to commercialize innovations. The authors study 145 spinoffs and 121 buyouts that occurred in the United States between 1996 and 2005. Analysis provides three critical findings. First, spinoffs have higher profits in the two years after divestiture; afterwards, buyouts have higher profits. Second, strategic emphasis (investment in R a two‐step mediated effect via strategic emphasis and radicalness . Copyright © 2013 John Wiley & Sons, Ltd.