Perhaps there is a silver lining to the ever gathering dark clouds after all?
Companies with cash in the bank will be able to pick up a whole range of technologies that, to be frank, were never going to make it to the market on their own, for sums in the low millions which is pretty much what an unproven technology is worth. The recent Tokyo Electron/Unidym deal falls into that category, although the longer established Hyperion Catalysis seems to be doing just fine, thank you very much. I have been involved in the acquisition of two companies in the last few weeks, all great technologies and all set to address some major markets.
For companies starting up now the good news is that expectations have been reset. VCs will no longer be expecting to pump a few million into a University spin out and expect an IPO of Google proportions within a few years. It is amazing that they ever thought that this was possible for more than one company per decade and this kind of ego driven delusion probably explains the Venture Capital industry’s current ills.
The recession provides an opportunity for us all to get our heads down and focus on the boring stuff, customers, markets, channels, and meeting unmet demand rather than worrying too much about the technology. One of the biggest successes of recent years, the iPod, was built on the back of technologies developed by others, and by combining good design with understanding the market opportunity. In the same way that Apple did not need to invent the hard drive (or research giant magneto resistance) to produce the iPod, the raft of rapidly maturing nanotechnologies in labs across the world should keep entrepreneurs busy until the middle of the next economic boom.