The “innovation ecosystem” represents a complex and interconnected journey, drawing heavily on initial research conducted at the university level, then moving through a chain of parties and decisions toward a goal of successful commercialization. This diagram outlines the system and the role of each function, starting with identifying the two main components, technology creation and technology commercialization.
The process starts with universities, entrepreneurs and corporations conducting various types of research, including: basic research to advance general knowledge; applied research to focus on a specific academic, commercial or business objective; or translational research that uses multi-disciplinary collaborations to make findings useful for practical applications to enhance human health.
Research feeds into development, where business and technical resources come together to offer a set of features and benefits in a product. The outputs of R&D include invention, patents, and trade secrets (confidential information that provides a company with a competitive edge) to form the technology, or the specific set of features and benefits offered in a product.
In many cases, to prepare the technology to move from academia to industry requires additional research funding. Large corporations frequently invest in university research to develop more advanced technology more cost-effectively than doing it internally.
Commercialization requires supporting activities such as service, distribution, logistics, meeting regulatory requirements, and so on. It takes one of two forms, either corporations or startups. Startups must simultaneously raise capital and plot a liquidity event that provides return for their investors, and must assemble a support network to bring the product to full commercialization.
Startup companies typically progress through stages of funding from seed to early-stage, then to growth stage and later-stage, before achieve liquidity for their investors by eventually being sold or selling their stock on the public markets. These monies come from various types of investors from friends and family, angel investors, venture capitalists, and corporate venture capital.
Incubators like PLSG provide a critical mechanism to assist startup companies as they participate in pre-seed, seed, and early-stage funding. Startups that tap into the power and viability of incubators enjoy a higher success rate in bringing their products to market.
The conclusion of a successful innovation cycle is a product available in the market, producing a profit, and providing a return for investors. With all these ingredients satisfied, the innovation ecosystem provides increased employment and a strong contribution to the economy.
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