For most of the twentieth century, innovation was the territory of large organizations. Schumpeter argued that innovation should naturally happen within them. Innovation required significant amounts of resources—amounts that only large organizations had. Commencing in the 1960s with the first venture capital efforts,1 the wall between smaller organizations—particularly startup companies coming out of universities—and innovation began to come down. The idea that scientific progress could hit the market through newly formed companies with venture fund- ing rather than partnerships with established companies started to take hold. A different channel for breakthrough innovation—in- novations with the potential to change industries and/or ...

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