International entrepreneurship and innovation Essay

International entrepreneurship and innovation - Essay Example It makes life comfortable for a lot of people but the strength of Cochlear Property is that it is a unique technology which cannot be easily replicated due to the fact that the company has a patent right to the technology. The second factor responsible for the success of Cochlear Property is the Australian governments policy of encouraging pharmaceutical and medical research entities. This provided the much needed capital which was used to get the company to move to a high pedestal in its operations and attain a sustained level of productivity. The fourth element of the success of Cochlear Property is the fact that the company has been able to penetrate specific markets. This is because it is a specialised product that is suitable for deaf people in different parts of the world. The ability to get the products to consumers makes the company solvent and keeps it going. Risk-reward trade off refers to balancing entrepreneurial risk for rewards in the form of profits or revenues (Mankiw, 2012). Cochlear has a technology that is unique, distinct and very much in demand amongst a particular niche of the markets around the world. However, the risks relate to the challenge of financing. Hence, financing risk was the main and central risk that faced Cochlear Property. The main risks involve the internationalisation of the company through the acquisition of funds. The low capital and the the need for internationalisation came with the challenge of raising funds and this had the inherent risk of destabilising the company and its capital structures as well as its going concern status. Acquiring funds from sources that proved to be extremely expensive meant the company would pay too much money to finance their debts. This will mean too much interest to be paid at different points in time and this could cut down profitability and lead to the collapse of the company. On the other hand, equity financing meant the risk of opening the door