Phi Beta Capitalism; Inspired by spinoffs like Google and Sun, schools worldwide take start-up 101.

Byline: Stefan Theil

What do Google, Yahoo and Sun Microsystems have in common? Like hundreds of Silicon Valley firms, they all trace their roots to Stanford University. The wealth, jobs and economic dynamism thus created have not been lost on wanna-be Stanfords around the world.

From Sweden to Singapore, universities and governments are outdoing each other to foster student and faculty entrepreneurship. They've been spurred by recent reports from the OECD and others detailing the boost universities can give to economic growth. Singapore last year announced plans to spend some $7 billion by 2010 to finance biomedical research and university spinoffs. In Britain, a national campaign has raised the number of university spinoffs and start-ups from 430 in 2000 to 787 in 2004, the most recent year for which numbers are available. In Sweden, universities such as the Karolinska Institute now operate venture funds that seed campus start-ups. European business schools, in turn, have been rejiggering courses to focus more on how to create and grow new companies, not just traditional management. At INSEAD in France, for example, a "resident entrepreneur" now passes on his experience in venture finance and start-up management.

The payback comes in many ways. Schools ...