From fundamentals to applications: a review on femtosecond (fs) laser micro/nano processing, recently published online in the International Journal of Extreme Manufacturing. Dr. Le Gao and co-authors from University of Shanghai for Science and Technology present this comprehensive review on the development of fs laser micro/nano processing, including topics such as fundamentals and unique phenomena of fs-laser pluses and matter interactions, pulse-shaping and high throughput fabrication, fs-laser processing in transparent materials, 4D printing, heterogeneous integration and 3D functional micro devices manufactured by fs laser-powered processing technology. This review sums up the recent development of the technology and a perspective is proposed to explore the challenges and future opportunities for further betterment of fs laser micro/nano processing technology.

Unprocessed rice kernels that are encased in an inedible hull must undergo milling to reveal the white rice grain. Proper milling can increase the amount of rice that makes it from the farm to the kitchen by decreasing the number of broken kernels, along with impacting nutritional and functional qualities, sensory attributes and cooking performance. Griffiths Atungulu, a professor and agricultural engineer with the Arkansas Agricultural Experiment Station and Dale Bumpers College of Agricultural, Food and Life Sciences, recently published a study with members of his rice processing research team that offers information to help optimize lab methods for rice milling.

A large Mendelian randomization study, published in eGastroenterology by Liu et al., identified multisite chronic pain as a key causal factor for irritable bowel syndrome (IBS), along with links to depression, neuroticism, and gastro-esophageal reflux disease. The findings highlight chronic pain and mental well-being as priority targets for IBS prevention and call for integrated strategies addressing both gastrointestinal and psychiatric health.

Together, or not together, that is the question. Hamlet is not the only one facing life-changing questions – wild animals have to make decisions pivotal to their survival on a daily basis. In a modelling case study, scientists of the GAIA Initiative investigated whether exchange of information among African white-backed vultures (Gyps africanus) bring more advantages than disadvantages to the individual vulture in its search for food. They found that social foraging strategies are overall more beneficial than non-social strategies, but that environmental conditions such as vulture and carcass densities greatly influence which strategy yields the best results.

Purpose

This paper provides a structural model to value startup companies and determine the optimal level of research and development (R&D) spending by these companies.

Design/methodology/approach

This paper describes a new variant of float-the-money options, which can act as a financial instrument for financing R&D expenses for a specific time horizon or development stage, allowing the investor to share in the startup's value appreciation over that duration. Another innovation of this paper is that it develops a structural model for evaluating optimal level of R&D spending over a given time horizon. The paper deploys the Gompertz-Cox model for the R&D project outcomes, which facilitates investigation of how increased level of R&D input can enhance the company's value growth.

Findings

The author first introduces a time-varying drift term into standard Black-Scholes model to account for the varying growth rates of the startup at different stages, and the author interprets venture capital's investment in the startup as a “float-the-money” option. The author then incorporates the probabilities of startup failures at multiple stages into their financial valuation. The author gets a closed-form pricing formula for the contingent option of value appreciation. Finally, the author utilizes Cox proportional hazards model to analyze the optimal level of R&D input that maximizes the return on investment.

Research limitations/implications

The integrated contingent claims model links the change in the financial valuation of startups with the incremental R&D spending. The Gompertz-Cox contingency model for R&D success rate is used to quantify the optimal level of R&D input. This model assumption may be simplistic, but nevertheless illustrative.

Practical implications

Once supplemented with actual transaction data, the model can serve as a reference benchmark valuation of new project deals and previously invested projects seeking exit.

Social implications

The integrated structural model can potentially have much wider applications beyond valuation of startup companies. For instance, in valuing a company's risk management, the level of R&D spending in the model can be replaced by the company's budget for risk management. As another promising application, in evaluating a country's economic growth rate in the face of rising climate risks, the level of R&D spending in this paper can be replaced by a country's investment in addressing climate risks.

Originality/value

This paper is the first to develop an integrated valuation model for startups by combining the real-world R&D project contingencies with risk-neutral valuation of the potential payoffs.