As well as generating more jobs on average than other Swiss start-ups, ETH spin-offs are also acquired more frequently. A decisive factor, according to University of St.Gallen’s comprehensive analysis, comes from the institutional support for entrepreneurship.
With around 500 ETH spin-offs now in existence, these businesses play a key role in the transfer of knowledge to the Swiss economy. In order to estimate the performance and economic added value of these companies, a detailed analysis was performed for the third time after similar analyses in 2008 and 2015. The analysis assessed four categories: human resources factors, influence on the economy and innovation, financial matters and operational aspects.
More Swiss Jobs
Ninety-five percent of the spin-offs are still located in Switzerland, with the majority based in Zurich, thus enabling them to boost the country’s economy and capacity for innovation. The group of 145 ETH spin-offs analysed as part of the study was shown to have created around 4,500 full-time equivalent (FTE) jobs. Each company provided about 30 positions on average, more than twice the average number for Swiss start-ups. ETH Zurich spin-offs also demonstrate clear signs of growth: in 2008, such enterprises generated only seven new jobs on average.
Major differences are evident between the sectors, too. Companies in the field of electrical engineer-ing and electronics – with more than 2,000 FTEs – are the frontrunners when it comes to the number of jobs created. The number of patents per company – an indicator of innovative strength – is also highest in the electronics sector.
Creating a Value of Almost CHF 5 Billion in Equity
The group analysed – a good third of all ETH Zurich spin-offs – generated almost CHF 900 million in revenue in 2017. The financial figures therefore clearly show that ETH spin-offs represent an attractive investment option, with the money multiple at 3.6 on average. The overall equity value of this group is almost CHF 5 billion – extrapolated to all ETH spin-offs, the value would be closer to CHF 10 billion. Biotech and pharmaceutical companies receive by far the most investor funds.
ETH spin-offs are much more likely to make an exit