There are myriad ways for Tech companies to fail. This is the story of one such failure and why it happened, at least in the opinion of this author. The invention was a superior kind of chemical material with wide potential applications across multiple major industries. Several patents protected these inventions. As lead investor, I led two rounds of Angel Investment totaling over $800k, accompanied by several state grants and investments adding $400k and federal SBIR funding more than $1 Million. These funds came after Millions in grants had been used to develop the materials at Michigan State University.
What was the problem? Why did this commercialization not succeed? Well, therein is the story. Of course there were multiple issues such that after less than three years, the Company closed its doors and returned its technology license to Michigan State University. But the salient issue was that while the new materials could significantly improve commercial materials in diverse applications, no one case was compelling enough to forcefully argue for commercial adoption which would require at least some changes in production. So no Corporate Knight in shining armor came to our rescue.
It did not help that it took us more than a year to supply large volumes of the materials to potential sponsors (multiple liters of very light weight powders weighing a kilogram or more). We were able to build a pre-pilot plant to do that, and design was complete on a much larger scale pilot plant.