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Four problems are addressed; (1) the critical role of competent actors in the venture capital and exit markets capable of supporting rapid industrialization of winning technologies in small innovative firms, (2) the competence of the large firm to integrate large-scale operational efficiency with small-scale innovative capability through distributed development work and integrated production and (3) the role of a viable market for strategic acquisitions in allowing a flexible choice for the small firm between growing aggressively on its own through own acquisitions, or being acquired strategically itself. We finally (4) ask what becomes of the Coasian theory of the firm when typical internal hierarchal functions are constantly outsourced in, or insourced from the market as the relative efficiency of coordination through management and over the market changes. We find that new industrial technology makes the market for strategic acquisitions increasingly important for growth ”into ” a new type of economy characterized by small scale, competence intensive production distributed over a Marshallian industrial district of integrated subcontractors. We conclude that this market has to be supported by incentives that stimulate variety in the supply of innovations and the local competence (receiver competence) to access, and build businesses on the same external, innovative supplies. We also find that Europe is handicapped on all counts compared to the US, i.e. in the organizational competence that will become critical in ushering in a future New Economy. Key words: competence bloc, experimentally organized economy, heterogeneity, Marshallia