1 New Start-Up Firms among Swedish Patent Holders Roger Svensson Research Institute of Industrial Economics (IFN) September 2008 1. Introduction The purpose of this chapter is to describe and analyze how patents are commercialized and how the choice of commercialization mode affects performance. The emphasis is on patents that are commercialized in new start-up firms. However, throughout the chapter the new firm alternative will be compared with the other possible modes of commercialization, i.e. patents that are sold, licensed, or commercialized in existing firms, where the inventor is either owner or employed. Four aspects of new start-up firms and other modes of commercialization are described and analyzed: 1) Which owners / inventors commercialize their patents? 2) Which owners / inventors start-up new firms and which ones use other modes of commercialization? 3) How is the choice of commercialization mode related to subsequent profitability? 4) How is the mode of commercialization related to the renewal and the value of patents? The empirical analysis examines a unique dataset of Swedish patents granted to individuals, small firms, and medium-sized firms. The dataset is based on a survey with a response rate of 80 percent. The unit of observation is patents, rather than inventions, since the former are much easier to identify and follow. The dataset provides information about whether a patent was commercialized, and if so, when and how. The data also contain information about the profitability of commercialized patents, as well as the renewal scheme of patents.