Cases in Technological Entrepreneurship

Cases in Technological Entrepreneurship

Converting Ideas into Value

Edited by Claudio Petti

The book examines from different perspectives a number of fundamental issues in the process of transforming technological innovations into profits. Key cases and field insights from distinguished contributors show the role and the practices of government bodies, universities, private investors and companies within the transformation of new ideas into value, in start-ups as well as in incumbents. The book takes a systemic view of technological entrepreneurship, positioning the topic at the interface between entrepreneurial and strategic perspectives within the emergent strategic entrepreneurship field.

Chapter 3: Finding, Financing and Growing Technology-based Innovations: A Perspective on MIT

David Verrill

Subjects: business and management, entrepreneurship, organisational innovation, economics and finance, economics of innovation, innovation and technology, economics of innovation, organisational innovation

Extract

David Verrill INTRODUCTION Schumpeter’s vision in 1939 about entrepreneurial innovation as a key driver of the economy is even more true today, as creative destruction is exhibited in a new technology-driven economy. In 2007 US venture capital companies invested nearly $30 billion in technology ventures – more than half of them in California (Silicon Valley) and Massachusetts (Boston/Cambridge). Individual, wealthy ‘angel’ investors contributed nearly the same amount ($26 billion) of capital, investing largely in early stage companies. Universities like the Massachusetts Institute of Technology (MIT) act as important engines of innovation. In 2007 MIT sponsored more than $600 million of research. A good portion of that was funnelled through interdisciplinary research centers that bring expertise from different schools and departments together to solve complex problems. A BankBoston study (Ayers, 1997) performed in 1997 showed that MIT had spawned more than 4000 companies which employed more than a million people and had revenues of nearly $250 billion a year – or the equivalent in 1997 of the 24th largest economy in the world above South Africa, Greece and Norway. The Boston/Cambridge area has a key set of ingredients that make it a dynamic ecosystem of innovation. These ingredients are similar to other parts of the USA that are also sources of innovation – Silicon Valley and Orange County in California, Research Triangle in North Carolina and Austin in Texas. MIT’s role in enabling innovation is undeniable. But in addition to MIT, the Boston/Cambridge area provides a critical set of ingredients that allow the region...

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