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Beyond the widely acknowledged importance of new business, the role of young exporting high-tech business in Israel and many other small economies is seen as vital for economic growth. Israel is small and geographically isolated from the main markets, suffers from security difficulties, but fosters a culture, which promotes knowledge rich new technologies. Thus, new ventures with leading edge technologies and prospects of high growth and profitability offer a means to achieve the national goal of economical independence. Internationally however, the high-technology sector has recently suffered badly from the bursting of the dot.com bubble and the crash of the Nasdaq.

This paper investigates the extent to which formal capital budgeting methods are used in small high-tech firms. We define high-tech firms by their R&D intensity. In addition, we define software industry as a special type of R&D-intensive firm. We focus on the methods that are used by the small high-tech firms in evaluating the profitability of investment projects, estimating the cost of capital and making decisions related to the capital structure. Our results based on two surveys of Finnish firms indicate that the high-tech firms use similar capital budgeting methods and estimate their cost of capital in a similar way to other small-sized firms in other industries. Moreover, high-tech firms seek external financing and co-owners.

The global strategies of high-tech start-ups fall into two types. One is characteristic of knowledge-based firms; the other is characteristic of knowledge-intensive firms. We present two propositions related to timing of globalization and resource acquisition for each type and examine four case studies from the region around Cambridge University in the United Kingdom.

Knowledge-based start-ups target global markets from the very beginning, aiming at rapid market penetration. From the start they are highly globalized in acquiring core technology and financial and human resources.

In contrast, knowledge-intensive start-ups start in local markets and initially restrict acquisition of core technology and financial and human resources to those markets. Only at a later stage, when the local business is solidly established, do they gradually expand their businesses to global markets.

The chapter is devoted to the analysis of industrial development in Russia since 2005. Characteristic features of the Russian industry are considered. It is shown that the Russian industry is specific both by its structure and its high heterogeneity. The mining and quarrying sector and related manufacturing industries play a significant role in the Russian economy and major role in industrial production. In the foreseeable future, these sectors can strengthen their leading positions.

Considerable attention is paid to the analysis of the industrial policy of the Russian government, which has traditionally been one of the leading actors of industrial development. The main directions of industrial policy are singled out: compensation of negative changes, catching-up, and advance development. It is noted that the role of the government is ambivalent: on the one hand, it seeks to develop high-performing companies, including new and fast-growing ones, and on the other hand, it often supports large, low-performing enterprises. With the declared continuous emphasis of industrial policy on innovation and modernization, low innovativeness of Russian companies remains. Based on the analysis of modern conditions, as well as new objects and instruments of industrial policy, some prospects for future industrial development have been revealed.

Over many years people have tried to understand the entrepreneurial process (e.g., Hayek, 1945; Kirzner, 1973; Shane & Venkataraman, 2000; Schumpeter, 1934). Van der Veen and Wakkee (2004) reviewed the literature and introduced the role of the entrepreneur and the environment in this process. An environment can have two roles: as a stimulus for opportunity (Burt, 1992; Gaglio, 1997; Shane, 2000; Vesper, 1989), and as a resource for pursuing that opportunity (Brush, Greene, & Hart, 2001). The view emerging from the research by Shane and Venkataraman (2000) and Van der Veen and Wakkee (2004), is that the entrepreneurial process is not merely a series of decisions, but more a sequence of events the entrepreneur goes through as a result of the environment and previous actions taken.