Toward the end of the article, Greg argues that big companies should use early stage acquisitions as outsourced R&D.
In other markets this has proven fruitful. Specifically, in the pharmaceutical industry, the major players such as Pfizer have increasingly turned to the acquisition of startups to fill their drug pipeline, rather than their own internal research groups. That eliminates much of the Phase 1 and 2 risk, but also allows the market to assemble the best innovators rather than attempting to internalize it.
In other markets this has proven fruitful. Specifically, in the pharmaceutical industry, the major players such as Pfizer have increasingly turned to the acquisition of startups to fill their drug pipeline, rather than their own internal research groups. That eliminates much of the Phase 1 and 2 risk, but also allows the market to assemble the best innovators rather than attempting to internalize it.