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Summary

In addition to the use of patents and secrecy described in the previous chapter, firms capture the returns from the introduction of new products and services through the control of resources, building brand-name reputations, exploiting learning curves, first mover advantages, and control of complementary assets in manufacturing and marketing. This chapter explained how each of these appropriability mechanisms affects you as a technology entrepreneur seeking to set up a successful new company.

Controlling resources is a strategy in which you buy up or contracts for the key sources of supply for producing the new product or service. This strategy is most effective when there is a bottleneck in the production process, making one resource crucial and rare.


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