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2015 | Book

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Technology Financing and Commercialization

Exploring the Challenges and How Nations Can Build Innovative Capacity

Author: Jarunee Wonglimpiyarat, PhD, ACCA, CPA, CIA, CFE, CGAP, CFSA, CISA, CISM

Publisher: Palgrave Macmillan UK

Part of: Springer Professional "Wirtschaft+Technik" , Springer Professional "Technik" , Springer Professional "Wirtschaft"

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About this book

This book offers insights on effective policies that can be applied to other economies in terms of using technology financing to foster technological innovations. It outlines the role of government in accelerating the nation's innovative capacity by promoting technology investments that will achieve successful and sustainable economic development.

Table of Contents

Frontmatter

Introduction

Introduction
Abstract
Technology financing — the process of funding innovative businesses to turn technological inventions into commercial innovations — has received considerable attention in the emerging trends of research and in relation to a knowledge-based future. Technology financing can be seen as co-evolving with the high-tech industry because high-technology investments enable the process of technology management and commercialization to reach its full potential. Technology financing is considered particularly important in the start-up stage of businesses. This is because financial resources are a necessary resource required by firms to start their businesses and subsequently operate. Effective financing is important in building national innovative capacity to achieve successful and sustainable economic development. However, there is a dearth of research with regard to how to effectively finance innovative businesses to help them grow and be an engine to foster economic growth. This book therefore attempts to address some deficiencies in the existing empirical research in technology financing and commercialization.
Jarunee Wonglimpiyarat

Special Introduction: The Entrepreneurial University Wave

Special Introduction: The Entrepreneurial University Wave
Abstract
An entrepreneurial wave is spreading across the academic universe. If not a tsunami, it is certainly more than a ripple as evidenced by the increasing attention to the model by policy makers, universities, and researchers since I initially set it in motion 30 years ago (Etzkowitz, 1983). As awareness and interest grow, a university wants to play a more strategic role in encouraging regional innovation, renewal, and growth. This occurs through local actors from academia, industry and government, coming together, at the invitation of a respected person with convening power, to formulate and implement a strategy to promote regional development via a ‘High-tech Council’ or ‘Knowledge Circle’ (Jonker, 2013).
Henry Etzkowitz

Concepts of Technology Financing and Commercialization

Frontmatter
1. Introduction to Technology Financing, Technology Management, and Commercialization
Abstract
This chapter provides an overview of technology financing and some important concepts related to technology commercialization. This chapter is organized as follows. Section 1.1 discusses the importance of technology financing with a focus on its relation to the high-tech industry. Section 1.2 reviews the concepts of technology and innovation management, generations of innovation models, and technology strategies. Section 1.3 deals with the process of technology commercialization. It also discusses the groups of customers in the marketing of high-technology products and the difficulties in crossing the chasm (that is, a move from the early adoption stage of technology to a mass market). In Section 1.4, the concept of national innovation system (NIS) is introduced to aid in the understanding of the role of institutional settings in supporting the production, diffusion, and exploitation of knowledge and innovations. This section also addresses the innovation-financing policies required for effective commercialization. Section 1.5 discusses various studies on the life cycles related to innovation management, the degree of technological change, and the concept of disruptive technology in the process of technological change. Section 1.6 discusses the Triple Helix model for competitive innovation systems and the role of clusters in facilitating innovation.
Jarunee Wonglimpiyarat
2. Financing Innovative Businesses Toward Commercialization
Abstract
This chapter presents a conceptual background and discusses selected concepts of financing innovative businesses toward commercialization. In the early stage of technology financing, technology-based firms generally seek informal sources of funding (because bank financing is not a type of financing option available to early-stage business ventures due their high-risk nature), including venture capital (VC) financing, and business angels, before they access formal funding sources, like banks, other financial institutions, and capital markets, in later stages. This chapter aims to provide a better understanding of the financing options that would help technology-based firms progress toward the commercialization stage.
Jarunee Wonglimpiyarat
3. Financial Models for Evaluating Technology Investments
Abstract
This chapter begins with the concept of research and development (R&D) as a necessary cost of business (Section 3.1). The financial models for evaluating R&D technology investments and implications of the firm’s technology strategies are introduced in Section 3.2. Section 3.3 provides a theoretical review to better understand the process of evaluating R&D project undertakings. This section also covers the R&D evaluation framework for evaluating staged R&D investments: ex-ante or prospective evaluation, ongoing or interim evaluation, and ex-post or retrospective evaluation. Section 3.4 discusses the method for valuing R&D using the option-pricing model. Given that the value of technology-based firms is mostly generated by intangible assets, the approaches used for evaluating intangible investments are reviewed in Section 3.5. This section also discusses the three main approaches for valuing intangible assets: market approach, cost approach, and income approach.
Jarunee Wonglimpiyarat

Case Studies of Successful Technology Financing and Commercialization Programs

Frontmatter
4. Case Study of Technology Financing and Commercialization Programs — US
Abstract
The US has been recognized as a world leader in terms of innovative capacity and competitiveness. In 2013, the US was the world’s most innovative economy, according to the International Institute for Management Development (IMD) world competitiveness ranking, and was in fifth position, according to World Economic Forum (WEF) ranking. To understand the mechanisms of technology commercialization and innovation financing programs leading to the growth of the US economy, this chapter is devoted to the competitiveness of Silicon Valley, California, and Boston Route 128 (New England), Massachusetts, which have the highest concentration of high-tech industries and investments.
Jarunee Wonglimpiyarat
5. Case Study of Technology Financing and Commercialization Programs — Canada
Abstract
Canada is one of the industrialized economies in the G101 and a member of the North American Free Trade Agreement (NAFTA).2 The country was ranked 7th in the 2013 International Institute for Management Development (IMD) world competitiveness ranking and was ranked 14th according to 2013 World Economic Forum (WEF) Global Competitiveness Index. The competitiveness of Canada is largely innovation-driven, with the support of government policies for technology financing. This chapter will explore government financing programs and mechanisms of technology commercialization that drive the economic development of Canada.
Jarunee Wonglimpiyarat
6. Case Study of Technology Financing and Commercialization Programs — Israel
Abstract
Israel is an innovation-driven country, having made the successful transition from an underdeveloped economy to a high-tech powerhouse. The country was ranked 19th in the 2013 International Institute for Management Development (IMD) World competitiveness ranking and 27th according to 2013 World Economic Forum (WEF) global competitiveness index. Israel was also ranked 16th in the category of very high human development according to the United Nations Development Program’s Human Development Report Index in 2012. In 2010, Israel was invited as a full member in the Organisation for Economic Co-operation and Development (OECD), an economic group of developed countries. The competitiveness of Israel is a result of its entrepreneurial culture and the government-led technology policies in venture capital (VC) financing. Israel’s high-tech industry — Silicon Wadi — is recognized as the most successful Silicon Valley-style economy outside the United States.
Jarunee Wonglimpiyarat

Forging Ahead — Innovative Case Studies in the Asian Economies

Frontmatter
7. Case Studies of Technology Financing and Commercialization Programs — Asian Dragons
Abstract
Singapore and Taiwan are the leading first-tier countries/newly industrializing economies (NIEs) in Asia. Both countries have been regarded as Asian Dragons for their rapid economic transformation. Singapore was ranked 5th in the 2013 International Institute for Management Development (IMD) world competitiveness ranking and 2nd according to 2013 World Economic Forum (WEF) global competitiveness index. Taiwan was 11th in 2013 according to IMD World Competitiveness Scoreboard and 12th in 2013 in the WEF global competitiveness index. Singapore and Taiwan are categorized as innovation-driven economies by the WEF global competitiveness index 2013–2014. Both countries are acknowledged as the most successful countries in devising and implementing policies for financing innovations.
Jarunee Wonglimpiyarat
8. Case Studies of Technology Financing and Commercialization Programs — Asian Tigers
Abstract
Malaysia and Thailand are the emerging tigers in Asian economies. Both countries are regarded as second-tier newly industrialized economies (NIEs) and Asian Tigers. Malaysia was ranked 15th in the 2013 International Institute for Management Development (IMD) world competitiveness ranking and 24th in the 2013 World Economic Forum (WEF) global competitiveness index. Thailand was placed 27th in 2013 in the IMD World Competitiveness Scoreboard and 37th in the 2013 WEF global competitiveness index. According to WEF global competitiveness index 2013–2014, Malaysia is a country in transition from an efficiency-driven economy toward an innovation-driven economy, while Thailand is an efficiency-driven economy. In both countries, public financing policies play an important role in driving technology transfer and commercialization.
Jarunee Wonglimpiyarat

Technology Financing to Enhance Innovative Capacity

Frontmatter
9. Technology Financing Toward Effective Economies
Abstract
In the world of high technology, there are a multitude of uncertainties and risks that a company has to confront. Technology financing helps bridge the valley of death and enables venture companies to handle the uncertainties and risks in high-tech commercialization. In previous chapters, we have seen the government initiatives, policies, and strategies to support high-tech companies whereby financing programs cover the stages from the laboratory to commercialization. However, while the government in many developing countries plays an important role to fuel innovation, high-tech companies should learn how to take advantage of government financing programs to mitigate risks in commercializing their product/process innovations. Technology financing, along with human capital development and the right innovation infrastructure, can help build up a nation’s innovative capacity toward an effective economy.
Jarunee Wonglimpiyarat
10. Conclusions and Outlook
Abstract
Technology financing — the process of funding innovative businesses to turn technological inventions into commercial innovations — is important in building national innovative capacity. In launching a new venture or funding the growth of existing ventures, businesses require technology financing along the stages of the innovation life cycle to transfer technology from lab to marketplace. Technology financing can be seen as co-evolving with the high-tech industry as it enables the process of technology management and commercialization to reach its full potential. To drive economic growth, the management of technology commercialization needs effective interactions among academia, industry, and government, as well as innovation infrastructure, appropriate public policy frameworks, and a legal environment.
Jarunee Wonglimpiyarat
Backmatter
Metadata
Title
Technology Financing and Commercialization
Author
Jarunee Wonglimpiyarat, PhD, ACCA, CPA, CIA, CFE, CGAP, CFSA, CISA, CISM
Copyright Year
2015
Publisher
Palgrave Macmillan UK
Electronic ISBN
978-1-137-47062-1
Print ISBN
978-1-349-50068-0
DOI
https://doi.org/10.1057/9781137470621