Technology Financing and Commercialization: Exploring the Challenges and How Nations Can Build Innovative Capacity

315 Pages·2015·1.518 MB·English

by  Jarunee Wonglimpiyarat PhD, ACCA, CPA, CIA, CFE, CGAP, CFSA, CISA, CISM (auth.)

Technology Financing and Commercialization
Also by Jarunee Wonglimpiyarat
STRATEGIES OF COMPETITION IN THE BANK CARD BUSINESS: Innovation
Management in a Complex Economic Environment
Technology Financing and
Commercialization
Exploring the Challenges and How Nations
Can Build Innovative Capacity
Jarunee Wonglimpiyarat, PhD
ACCA, CPA, CIA, CFE, CGAP, CFSA, CISA, CISM
Thammasat University, Thailand
© Jarunee Wonglimpiyarat 2015
Foreword © Henry Etzkowitz 2015
Softcover reprint of the hardcover 1st edition 2015 978-1-137-47061-4
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in accordance with the Copyright, Designs and Patents Act 1988.
First published 2015 by
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ISBN 978-1-349-50068-0 ISBN 978-1-137-47062-1 (eBook)
DOI 10.1057/9781137470621
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A catalogue record for this book is available from the British Library.
Library of Congress Cataloging-in-Publication Data
Wonglimpiyarat, Jarunee.
Technology financing and commercialization : exploring the challenges
and how nations can build innovative capacity / Jarunee Wonglimpiyarat.
pages cm
1. Technological innovations – Finance. 2. Technological innovations –
Management. I. Title.
HD45.W65 2014
338.5—dc23 2014023282
Contents
List of Boxes v iii
List of Figures x
List of Tables x iii
Preface x vi
Acknowledgments x vii
List of Abbreviations xviii
Introduction 1
I.1 Effective fi nancing toward innovative economies 1
I.2 The challenge of the study 2
I.3 Structure of the book 2
Special Introduction: The Entrepreneurial University Wave
Henry Etzkowitz 9
P art I Concepts of Technology Financing
and Commercialization
1 Introduction to Technology Financing, Technology
Management, and Commercialization 19
1.1 Introduction to technology fi nancing – why it
is important? 20
1.2 Technology and innovation management 23
1.3 Technology commercialization 29
1.4 National innovation system and fi nancing policies 32
1.5 Technology and innovation life cycles 35
1.6 Triple Helix model for competitive innovation system 41
1.7 Science parks and incubators to support technology
commercialization 44
2 Financing Innovative Businesses Toward
Commercialization 50
2.1 Technology fi nancing and investments 50
2.2 Venture capital fi nancing 55
v
vi Contents
2.3 Business angel investments 62
2.4 Commercial bank fi nancing 66
2.5 Capital market funding 70
3 F inancial Models for Evaluating Technology
Investments 78
3.1 R&D as a necessary cost of business 78
3.2 Financial models for evaluating technology
investment 82
3.3 Evaluating staged R&D investments 87
3.4 Valuation of R&D using option-pricing model 93
3.5 Evaluating intangible investments in
high-tech fi rms 96
Part II Case Studies of Successful Technology
Financing and Commercialization Programs
4 Case Study of Technology Financing and
Commercialization Programs – US 105
4.1 The competitiveness of Silicon Valley 105
4.2 The competitiveness of Boston Route 128 113
4.3 The US government fi nancing programs 122
5 Case Study of Technology Financing and
Commercialization Programs – Canada 132
5.1 The Canadian innovation fi nancing system 132
5.2 Venture capital fi nancing toward technology
commercialization 136
5.3 The high-tech cluster map and industrial
competitiveness of Canada 142
5.4 Government fi nancing programs 147
6 Case Study of T echnology Financing and
Commercialization Programs – Israel 153
6.1 Israeli innovation fi nancing system 154
6.2 The rise of high-tech industrial clusters 159
6.3 Venture capital mechanisms to drive technology
commercialization 165
6.4 The innovation fi nancing programs that support
entrepreneurship 170
Contents vii
Part III Forging Ahead – Innovative Case Studies
in the Asian Economies
7 C ase Studies of T echnology Financing and
Commercialization Programs – Asian Dragons 179
7.1 Singapore 179
7.2 Taiwan 186
7.3 Lessons learnt from the Asian Dragons 206
8 C ase Studies of T echnology Financing and
Commercialization Programs – Asian Tigers 209
8.1 Malaysia 210
8.2 Thailand 220
8.3 Lessons learnt from the Asian Tigers 234
Part IV Technology Financing to Enhance
Innovative Capacity
9 T echnology Financing Toward Effective Economies 239
9.1 Lessons learnt and insights of technology fi nancing
and commercialization 240
9.2 Technology-fi nancing challenges in today’s world 245
9.3 Outward-looking development of technology
fi nancing 251
10 Conclusions and Outlook 257
10.1 L essons and strategic implications of technology
fi nancing and commercialization 257
10.2 Looking ahead 263
Notes 266
References 270
Index 293
List of Boxes
1.1 Microsoft Corporation 21
1.2 Commercialization of technology – Xerox and Apple 28
1.3 Apple iPad – Crossing the chasm 32
1.4 Cloud computing – future disruptive technology? 40
2.1 Bootstrapping 51
2.2 Private equity 60
2.3 Keiretsu Forum and Kauffman Foundation 65
2.4 Small Business Administration (SBA) 67
2.5 Shanghai Pudong Development Bank (SPDB): A model
of Silicon Valley Bank in China and Asia 68
2.6 Loan securitization 69
2.7 NASDAQ market for technology-based firms 73
3.1 Research and development expenditure 80
3.2 Black–Scholes option-pricing model 96
3.3 IAS 38 Intangible Assets 97
3.4 Capital asset pricing model 101
4.1 Hewlett-Packard business model 108
4.2 Bayh–Dole Act – the government’s policy instrument
to support university research commercialization 119
4.3 Exit strategies to realize investment returns 130
5.1 Venture Capital Action Plan (VCAP) 133
5.2 Labor-sponsored venture capital corporations 139
5.3 Canada’s Industrial Research Assistance Program (IRAP) 148
5.4 Business Development Bank of Canada (BDC) 152
6.1 Tel Aviv Stock Exchange (TASE) 157
6.2 Yozma fund of funds 165
6.3 Silicon Wadi 167
6.4 R&D grants and R&D fund 174
7.1 Entrepreneurial university in Singapore 182
7.2 Catalist 183
7.3 Industrial Technology Research Institute (ITRI) 196
7.4 Hsinchu Science-based Industrial Park 201
8.1 From MESDAQ to ACE Market 214
8.2 Techno Fund and InnoFund 217
viii
List of Boxes ix
8.3 M arket for Alternative Investment – capital market to
promote innovation 225
8.4 G ood Innovation ... Zero Interest 232
9.1 C apital market for technology-based firms 240
9.2 I nvestments to support economic growth – Millennium
Development Goals (MDGs) and Sustainable Development
Goals (SDGs) 245
9.3 T echnology commercialization and 4Ps 250
9.4 O utward-looking technology financing 255
10.1 T riple Helix perspective to support technology
commercialization 262
10.2 L ooking ahead 263