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Abstract Research SummaryUniversity spinoffs (USOs) translate scientific advancement to economic gains, but the role of the university's governance as a public or private institution is infrequently explored. With a novel dataset of academic entrepreneurs with National Science Foundation I‐Corps training, we examine institutional governance as a fundraising signal. We demonstrate how angel investors and venture capitalists (VCs) show a preference for private USOs. However, with different investment objectives, the groups conduct distinct sensemaking that weighs this cue differently. For angels, industry moderates the effect such that they prefer private university life science firms to public USOs. However, industry mediates the effect for VCs, who prefer life sciences to engineering. We describe this variation as mixed salience—when a signal yields differences in decision‐making for distinct audiences. Managerial SummaryUniversity spinoffs (USOs) are important for economic growth, but little is known about differences between USOs from public and private universities. We study how angel investors and venture capitalists (VCs) fund USOs of public and private schools. These two investor groups make funding decisions with different priorities and approaches. Both groups appear to prefer private universities. A deeper look reveals that angel investors prefer private university life science teams to the public university counterparts. On the other hand, VCs prefer life sciences teams to engineering teams—and life sciences teams are more likely to come from private schools. Evidently, the two investor audiences respond to the public/private distinction in different ways. 

Abstract Research SummaryGender differences in peer review and the associated impact on innovation financing are well documented but less well understood. We study peer review in the National Aeronautics and Space Administration Small Business Innovation Research program, a public initiative seeking to increase women's access to innovation funds. We theorize that reviewers use status characteristics inappropriately as heuristics and create gender bias. Econometric analysis shows evidence of direct bias against female applicants, an effect linked to challenges for newcomers in demonstrating individual legitimacy rather than concerns about the organizational legitimacy of the associated firm. We also demonstrate a corrective redistribution to reverse this bias and create equity in the funding outcome. As these results negatively impact diversity in innovation, we propose policy recommendations to overcome this bias. Managerial SummaryPeer review is an important mechanism to rank and select technical proposals for funding. We examine the role of gender in a government program conducting this process. Controlling for the proposal quality and other factors, we show that the gender of the proposer is linked to lower scores. This effect is associated with proposals from females who are new to the program, suggesting their challenges in demonstrating credibility as leaders of these projects, and exacerbated by the fact that women represent a disproportionately high share of newcomers. Subsequently, the program reverses this bias such that the funding outcomes do not show the same inequities. This has important implications for policies supporting gender diversity in innovation. 

Abstract Research universities rely heavily on external funding to advance knowledge and generate economic growth. In the USA, tens of billions of dollars are spent each year on research and development with the federal government contributing over half of these funds. Yet a decline in relative federal funding highlights the role of other funders and their varying contractual terms. Specifically, nonfederal funders provide lower recovery of indirect costs. Using project-level university-sponsored research administrative records from four institutions, we examine indirect cost recovery. We find significant variation in the amount of indirect funding recovered—both across and within funders, as well as to different academic fields within a university. The distribution of sponsors in the overall research funding portfolio also impacts indirect cost recovery. The recovery variation has important implications for the sustainability and cross-subsidization of the university research enterprise. Together, our results show where universities are under-recovering indirect costs.