Having seen and done this transition I can tell you that companies do very little for innovation compared to university researchers. Companies are exclusively focused on profit, they don’t do the five to ten year moonshot project unless they are already a massive corporation, not a startup, and even then the massive companies want the easiest thing to translate to a product and begin making money. At best they have engineers that make scaling up more practical, and while that is a fun and interesting thing, it is also very straightforward and is something a company has to avoid screwing up, not investing in massively to make it right.

I’ve seen several companies that did literally nothing except swap a couple things on their production line and call it a day. The only transition from research to industry was an IP agreement and a few meetings.

Large companies are not looking for innovation by buying startups, they are usually looking to secure monopolies. Sometimes they want the product and to work it into their own product offerings. This is often a way to vertically integrate more, not innovate. They bring in-house because they see a competitor emerging and want to hedge their bets or because they see a way to take over a market by just doing the same thing. Sometimes it is just a way to hire some employees that seem pretty competent and thereby deprive your competitors. Large companies operate with a monopoly mindset. This is also why Google kills every project that they declare won’t scale into a huge money-maker (they really mean take over a market).

Small companies are often started with the plan of actually making and selling their product long-term but run headfirst into the fact that their industry is dominated by just 3 companies that will gladly do the one-two punch of threatening to bleed you legally with nonsense lawsuits while offering to buy you up. Or, on the flipside, just copying your work and changing it just enough that they know they could bleed you legally even though they have broken IP law. Usually, they would rather just buy you out at less than you are worth but enough to make the VCs happy.