Entrepreneurs in High Technology: Lessons from MIT and Beyond

Entrepreneurs in High Technology: Lessons from MIT and Beyond

Entrepreneurs in High Technology: Lessons from MIT and Beyond

Entrepreneurs in High Technology: Lessons from MIT and Beyond

Synopsis

The ingredients for success in starting and developing a technology-based company aren't obvious. Why, for example, did Digital Equipment Corporation succeed--and indeed become one of the most successful high-tech corporations in the world--while dozens of other companies with similar beginnings fail? It is a question that demands careful consideration by anyone setting up a new company or who is interested in starting one. In Entrepreneurs in High Technology, Edward Roberts, a Professor at the MIT Sloan School of Management, offers entrepreneurs a goldmine of information on starting, financing, and expanding a high-tech firm. His book reveals the results of research conducted over twenty-five years on several hundred high-tech firms, and it reflects the insights of the author's own first-hand experience as a company founder, director, and venture capitalist. Focusing on firms in the Greater Boston area--many of which have had technological links with MIT--Roberts traces the origins and the evolution of the high-technology failures and successes. He examines the work experience and family backgrounds of successful technical entrepreneurs, their sources of funding, and the ways they respond to the challenge of business growth. He compares the track records of firms with multi-founder teams and firms with individual founders, contrasts the performance of consulting firms and research-and-development contractors against companies that start out with a product, identifies the factors that limit an enterprise's ability to raise outside capital, and explores the critical influence of marketing orientation on successful companies. In a penetrating analysis of highly successful ventures, the author reveals the importance of strategically transforming the company to a market-oriented focus, and he examines the widespread tendency, even among the most successful high-tech firms, to displace the founder before the company achieves "super-success." For anyone planning to start a technology-based enterprise, Entrepreneurs in High Technology is essential reading--an invaluable preview of the financial, organizational, and marketing issues that confront every new high-tech venture. For business and technology watchers, it is an informative account of the promise and the perils entailed in bringing innovative ideas to the marketplace.

Excerpt

When I was a child growing up in a suburb of Boston, my parents often took me to the outdoor concerts of the Boston Symphony Orchestra at the Esplanade along the Boston shores of the Charles River. Looking across the Charles toward Cambridge in the evenings I was repeatedly awed by the looming majesty of M.I.T.'s bulk and, alongside it, the bright blue flashing roof-sign and logo of Electronics Corporation of America, an early high-technology firm located a few doors down Memorial Drive from what is now the MIT Sloan School of Management. My first strongly formed images of MIT were thus intimately interwoven with a fascination for technological entrepreneurship. Little did I realize then that my life's work would be at that interface of MIT and entrepreneurship.

This, then, is a book about entrepreneurs. But it is mostly about a very special group of entrepreneurs who were nurtured at or nearby MIT in the post-World War II explosion of science and technology and its applications to industrial and societal advance. Trained in high-technology in MIT's labs and academic departments or in the local industrial marvel that became known as the "Route 128 phenomenon", these entrepreneurs took their technical and innate skills with them to found their own new companies. The book explains the origins of these people and of the companies they founded and grew. It focuses on people, technology, money, and markets and their interplay in the formation, development and success or failure of hundreds of high-technology companies in the Greater Boston area.

The formal studies that led to this book began in 1964 and continue to the present. But three years earlier, out of a gnawing curiosity while I was still an economics doctoral student at MIT, I had cross-registered at the Harvard Business School to enroll in their New Enterprises subject, the only related subject then available in the Greater Boston area. And in 1963, just one year before this research began, I recruited my close MIT System Dynamics colleague, Jack Pugh, to join me in forming Pugh-Roberts Associates, my first act of business entrepreneurship. Over a quarter-century has passed since these beginnings and they have been exciting and fulfilling years, made whole especially by the combination of new enterprises research and action that have paralleled and become integral with my family life.

This book fuses my work with many close working colleagues, including research associates, graduate research assistants, and many thesis students. But it also draws from the unique environment of MIT and Greater Boston, and the generous willingness of the entrepreneurial community to share their experiences, their pains and their successes. The research could not have been carried out in a less thriving, less self-assured, less open . . .

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