Next month, in the French Riviera resort of Cannes, two new mobile phone products will be launched into what most people would regard as an overcrowded market.

The launch will mark a huge step for the organisation behind the developments - essentially components that expand the range of applications for mobile communications. For this will be the first real public manifestation of a company called Ubinetics.

Launched at the beginning of this year, the company is the first in what is planned to be a series of spin-offs from the management consultancy PA Consulting.

Through its technology arm based outside Cambridge, PA has long been at the forefront in bringing special project expertise to clients in high- tech industries, and it has developed a particular specialism in wireless communications. Now it has set up a separate arm - PA Ventures - specifically to investigate opportunities for new businesses that will have the twin benefits of keeping the firm abreast of leading technologies and ensuring a good return on its investments.

Ali Pourtaheri, the president of the new venture, explains that the Ubinetics venture arose from the feeling that a new type of business model was required to enable the organisation to continue to make a significant contribution to this fast-moving industry. In particular, clients were asking PA to share in the risk of developing products rather than take the usual consultancy approach of fees based on time worked.

Moreover, the departure stems from a recognition that product development works differently from advising and requires significant investment and an approach to organisation and marketing of the product that does not fit naturally with a consultancy.

While potentially hugely significant for PA, the development also has wider ramifications for the British economy. For years, there has been widespread criticism of the lack of enthusiasm for funding new businesses.

Contrasts are usually made with the United States, particularly California's Silicon Valley, and its role in spawning such organisations as Intel, Netscape and Cisco Systems.

Gordon Brown and his New Labour colleagues are generally seen to be sympathetic to the notion of supporting such businesses.

But there is an area in which business could help itself. This is "corporate venturing", whereby large companies invest in smaller ones, either to spread their exposure to certain markets or to obtain an interest in leading-edge technologies. Pharmaceutical firms and information technology companies have been active in this way. But other organisations seem more keen on handing back spare cash to shareholders than on looking for fresh investment opportunities.

In the heyday of Japan's economy, some of the country's biggest companies were adept at the practice - helping to give the then buoyant nation a reputation as a haven for enterprise and assisting in the expansion there by such people as the designer Paul Smith. But in Britain and other industrialised countries - for all the management guru and consultant talk about greater use of partnerships - the idea has been slower to catch on.

Jeremy Asher, chief executive of PA Consulting, knows his organisation is swimming against the tide. "A lot of venture capital funds explicitly avoid technology," he says, adding that there have been "a few instances" of failed corporate ventures.

Nevertheless, he believes that this is a highly effective way of "leveraging" the knowledge and expertise the firm has built up over the years. Mr Asher says it would have made such a move before if it had had the resources.

As an adviser to venture capitalists, PA insists that it is aware of the potential problems. But it is adamant that, while it is essentially backing colleagues, it will apply the same rigorous venture capital disciplines as it would to any other deal.

Though the firm is not talking about the scale of its funding, it has a majority holding in Ubinetics. But the management has no preconceptions about the size of the stakes it will be taking in other ventures.

PA says it will also look for funding from third parties. But it is clear that - even if it can see significant spin-offs arising from such transactions - a large chunk of the risk will be borne by the consultancy.

All of which must be sobering for Mr Pourtaheri and the 20 other former PA employees - if they have the chance to think about it. For the moment, though, with interest in their devices high even before their official launch, they are far ahead of budget.