This chapter elaborates the importance of local value added, knowledge, and ownership in latecomers’ catching up. The auto sector in Thailand, IT sector in Penang and mining sector in Chile show that reliance on foreign ownership is a recipe for limited domestic value added and innovation. Foreign MNCs source knowledge from R&D centers in headquarters and thus do not feel a need to cultivate R&D centers abroad. The eventual rise of local sources of knowledge and firms was possible owing to the involvement of the state in the various forms of industrial and innovation policies. In the most extreme cases, such as the palm oil sector in Malaysia, local ownership was obtained by hostile takeovers of foreign firms. In some cases, there were asymmetric regulations and promotion of indigenous firms over foreign firms, such as the auto sector in China. Promotion of locally owned firms and sectors goes together with discipline from global market competition, as seen from the failure of national cars in Malaysia. In sum, a common success formula is “learning from foreign sources at the initial stage, leading to the rise of local value added, knowledge, and ownership, owing to industrial policies under market discipline.”