When an innovative firm has to develop its own technology because a key technical component of their innovative product cannot be obtained from suppliers, it may succeed in creating a resource which has market applications in its own right. In this paper we argue that this represents an important form of technological speciation. We conjecture that the organization incubating such a technology may be ripe for spin-out and we explore a case study that throws light on technological speciation in the context of the incubation of a new venture within a parent company. Our focus is on the successful problem-solving that occurs through the spin-out of a new organization that is able to mobilize under-used resources and capabilities originating in the parent company and match them to new opportunities detected in the market. By looking at the micro processes that occur at the dyadic level of parent (originator company) � progeny (spin-out), the paper contributes a richer understanding of the role of prior knowledge and organizational imprinting in shaping the emergence and exploitation of a valuable entrepreneurial opportunity.