[Issue 5] Article 2: The Virtual Innovation Eco-System: Building Global Business Anywhere

Download PDF

Mark FENWICK, Kyushu University
Erik P.M. VERMEULEN, Tilburg University

Imagine two young Japanese innovators; let’s call them Hanako Sato and Taro Yamada. Let’s assume that Hanako and Taro have a disruptive idea for a high growth start-up business and that this idea shows real potential. They are driven, ambitious and both dream of building a global business that will change the world. Finally, let’s assume Hanako and Taro were born and grew up in the city of Fukuoka, located on the island of Kyushu in southwestern Japan. In order to pursue their dream and bring their idea to market, Hanako and Taro are  going to have to survive the difficult period in the early stage of the life cycle of  a company known as the “Valley of Death”; the period between the initial capital contribution and the company generating a steady revenue stream.  In order to be successful in this challenging task – after all, many businesses will fail at this early stage – Hanako and Taro will need to raise a significant amount of money. But this need for money raises a series of daunting questions: “Who should we turn to for investment?”; “What kind of money do we want to attract?”; “When is the right moment to seek investment?”; and, “Where should we locate our company, if our dream is to build a global business?”