SHAPING THE UNKNOWN WITH VIRTUAL UNIVERSES-THE NEW FUEL FOR INNOVATION

Résumé En

The new logic of financing innovation: from uncertainty reduction to shaping the unknown Handbooks in finance, as well as literature reviews, recall that financing innovation and financing productivity investment differ in their level of uncertainty. 1 Students learn that financing production investment requires a positive net present value (NPV), whereas financing innovation requires taking into account multiple uncertainties by computing expected NPV. Models of decision-making in uncertainty helped to compute the value of reducing uncertainty. 2 This approach is considered the best way to value investment in research and development (R&D)-R&D being considered an activity to reduce uncertainty. 3 In this time of "disruptive innovation" in the context of multiple socioeconomic and technological changes-such as energy transition, aging, and digitalization-it is tempting to consider that innovation dynamics tend to be characterized by an increase in uncertainty. Investments would, therefore, become much riskier, and financing might seem almost impossible. Fortunately, this "wisdom" misses a critical feature of contemporary innovation: it is not mainly about uncertainty but much more about "the unknown". In contemporary innovation, one has to deal not only with uncertain events, such as unstable markets and technological advances, but also partially unknown chimeras, such as inclusive mobility, smart cities, and sustainable energy. Therefore, it is critical for innovation success to deal with these initially unknown situations and shape them in a beneficial direction. 4 This distinction between uncertain and unknown has major consequences on innovation investment: the financing approach must not only consist of reducing uncertainty but also of shaping the unknown, i.e., through a capacity to design new alternatives, worlds, opportunities, markets, and usages.