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5.13 Bridging the Valley of Death
“If you think you are going thru Hell, keep on going.”
—Winston Churchill
The phrase “Valley of Death” was coined by Marczewski
24
to describe the
missing link during the transition from existing technologies to the creation
and acceptance of a compelling new market entry.
According to Frost and Sullivan, a consulting rm,
25
more than four out of
ve technologies developed globally never make it to the commercial world,
due to their inability to cross the Valley of Death—the virtual chasm that
separates the early market from technology demonstration in the mainstream
market.
Often this is due to businesses and investors failing to understand the
true market potential of a given technology platform and evaluate the risk-
reward elements, as seen in Figure5.16.
This is a period of exceptionally high nancial vulnerability to the
startup. The goal of the founder/entrepreneur is to nancially and techni-
cally survive the Valley of Death and then win a niche foothold in the main-
stream market as soon as possible. Examples include the rst PC, the rst
fax machine, the Internet, the cell phone, the smart phone, robotic surgery,
percutaneous heart valve repairs, etc.
References
1. Scott, M., & Bruce, R. Five stages of growth in small business. Long Range
Planning, 20, 45–52, 1987.
2. From the July 23, 2012 Fortune magazine issue.
3. Greiner, L.E. Evolution and revolution as organizations grow. Harvard
Business Review, 50(4), 1972.
4. Churchill, N.C., & Lewis, V.L., The ve stages of small business growth.
Harvard Business Review, May–June 1983.
5. Bray, H. For PC market, the numbers don’t compute. The Boston Globe,
Business, B7, April 15, 2013.
6. http://www.gartner.com/newsroom/id/2408515
7. Welsh, J.A., & White’ J.F. A small business is not a little big business. Harvard
Business Review, July–August 1981. Reprint No 81411.
8. http://entrepreneurs.about.com/od/beyondstartup/a/cashow101.htm
9. http://en.wikipedia.org/wiki/Innovation
10. http://www.go4funding.com/Articles/Types-Of-Innovations.aspx