Embracing Uncertainty: Value Creation by Advanced Materials Ventures

Centre for Technology Management (CTM) Working Paper 2010/02

51 Pages Posted: 6 Sep 2011

See all articles by Elicia Maine

Elicia Maine

Simon Fraser University (SFU) - Management of Technology; Simon Fraser University - Policy Analysis

Sarah J. Lubik

University of Cambridge - Centre for Technology Management

Elizabeth W. Garnsey

University of Cambridge - Judge Business School

Date Written: October 1, 2010

Abstract

How do advanced materials ventures overcome the daunting commercialization challenges of the sector: high technology and market uncertainty over long time frames, and the need for significant complementary assets and substantial financing? Does uncertainty enhance or obstruct value creation? To address these questions, this paper draws on research on value creation, technology commercialization, and, more specifically, advanced materials commercialization, and presents new evidence from a sample of 43 advanced materials ventures. The sample ventures are compared and analyzed to elucidate risk reduction and value creation strategies. The sample is subdivided into nanomaterials, performance materials, and fuel cell ventures through a hierarchical cluster analysis, and subgroup commercialization metrics are described and compared.

We argue that embracing uncertainty enhances value creation for nanomaterials and performance materials ventures but diminishes value creation for fuel cell ventures. High value creators in our sample lend further support to this argument through their commercialization strategies: reduction of uncertainty by fuel cell ventures, and embracing uncertainty by nanomaterials ventures. All of the successful advanced materials ventures commercialize radical technologies, emphasize strategic alliances, and begin demonstrating value with near-term, substitution applications.

Keywords: value creation, generic technology, radical innovation, technology entrepreneurship, advanced materials, technology commercialization, value chain positioning, market for technology, uncertainty, nanomaterials

JEL Classification: L60, M13, O3

Suggested Citation

Maine, Elicia M.A. and Lubik, Sarah J. and Garnsey, Elizabeth W., Embracing Uncertainty: Value Creation by Advanced Materials Ventures (October 1, 2010). Centre for Technology Management (CTM) Working Paper 2010/02, Available at SSRN: https://ssrn.com/abstract=1923056 or http://dx.doi.org/10.2139/ssrn.1923056

Elicia M.A. Maine

Simon Fraser University (SFU) - Management of Technology ( email )

Segal Graduate School of Business
500 Granville Street
Vancouver, BC V6C 1W6
Canada

HOME PAGE: http://motresearch.bus.sfu.ca/index.shtml

Simon Fraser University - Policy Analysis ( email )

Burnaby, British Columbia V5A 1S6
Canada

Sarah J. Lubik (Contact Author)

University of Cambridge - Centre for Technology Management ( email )

Engineering Department
Trumpington Street
Cambridge, CB2 1PZ
United Kingdom

HOME PAGE: http://www.ifm.eng.cam.ac.uk/people/sjl69/

Elizabeth W. Garnsey

University of Cambridge - Judge Business School ( email )

Trumpington Street
Cambridge, CB2 1AG
United Kingdom
+44 (0) 1223 338183 (Phone)

HOME PAGE: http://www.jims.cam.ac.uk/people/faculty/garnseye.html

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