According to the researchers, this trend stems from family firms' desire to maintain tighter control over their innovations and the value generated from them. This preference for internal development is not due to lower patent quality, but rather reflects the firms' strategic priorities. Family-owned businesses are more willing to forgo market exclusivity and legal protection associated with patent licensing in favour of internal commercialisation. This approach allows them to leverage internal resources to scale efficiently, while aligning with their values and maintaining organisational control.

By focusing on internal commercialisation, family firms balance their economic goals with non-economic objectives, such as preserving their legacy and exercising greater control over their intellectual property.

The study, led by Addis Birhanu, Professor of Strategy at emlyon business school, and Alfonso Gambardella, Professor of Corporate Management at Bocconi University, explored the link between family ownership and patent commercialisation strategies. Using data from 471 publicly listed companies and 2,759 patents across 20 European countries, the researchers combined patent information from PATSAT with ownership and firm characteristic data from Orbis.

The dataset provided insights into whether patents were being exploited internally or externally, and linked this with family versus non-family ownership status. The research concluded that family firms tend to scale up more effectively than non-family firms by prioritising internal patent exploitation, reflecting a strong preference for keeping control within the business.

“These findings show that family firms manage to strike a balance between their desire to maintaining control over their innovations and maximising profit,” says Professor Birhanu. “By leveraging their strategic resources, family firms achieve effective internal growth and innovation, providing new value for the organisation."

With many believing that this would be a negative for family firms, these research findings clearly show that family firms' strong control preferences can enhance their ability to internally exploit resources and scale up effectively, whilst non-family firms continue to opt for using licensing as a viable approach to profit from their patents.

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