Avoiding failures in biotechnology start-up: Managing and balancing innovation, money and human factors

Abstract

Biotech start-ups fail for many different reasons which can result both from the competitive landscape they are in and because of the lack of capabilities within the firm. The latter, or the resource-based view of firm has been studied by many scholars, and three main resources have been identified as key for biotech start-ups: innovative technology, money, and human resources. These factors have often been analyzed separately, but it is important to look at them as one single entity as they interact closely. This work mainly concerns with the literature review of the three different factors and tries to throw light on the intertwining nature of all three. While doing that, a model for the evaluation of biotech start-ups risk of failure is compiled. The model shows the compensating relationship of the three factors and can be used for a quick risk evaluation of biotech start-up. The prospect and the application of the model are practiced within the context of our own start-up, Fidubrin. The model indicates that Fidubrin is currently facing low-medium risk and suggests areas of improvement. We have tried to rest our case stating the importance of synchronous functioning of the three factors, which can lead to success of Fidubrin.