We are hosting a pretty kickass conference on June 14th in Seoul exploring technology, innovation and future trends. The lineup of speakers is awesome with Ray Ozzie, Richard Florida, Catherine Mohr and others. These slides provide details on this event that I've been working on.
Showing posts with label innovation. Show all posts
Showing posts with label innovation. Show all posts
Monday, April 22, 2013
Monday, November 30, 2009
"Is America Losing Its Mojo?" or Are We Becoming a Nontrepreneur Nation?
A couple weeks ago Newsweek published Fareed Zakaria's piece:
Is America Losing Its Mojo?
Innovation is as American as baseball and apple pie. But some traditions can't be trademarked.
*photo from Newsweek (from left: Bettmann-Corbis: LOC-Corbis; Alfred Eisenstaedt / Getty Images; Jennifer Corbett / AP; Michael Grecco / Getty Images)
This was an interesting and insightful article that overlapped with my old op-ed, "Coming Soon: Nontrepreneur Nation," that was published at InsideWork and Private Equity HUB last year.
Another timely and overlapping article was last week's cover story in TIME magazine, "The Growing Backlash Against Overparenting".
Zakaria's op-ed continues along his "rise of the rest" theme and focused on Asia's current and future prominence. I believe he missed an important factor in this discussion which is America's declining taste for risk and entrepreneurship. In my opinion, this is driven by overparenting and failures in our education system.
Additional commentary from Forbes' Rich Karlgaard, "Fareed Zakaria on Innovation".
A related post by By Vivek Wadhwa, Director of Research at the Center for Entrepreneurship and Research Commercialization at Duke University, "Protectionism vs. the Innovation Nation".
Is America Losing Its Mojo?
Innovation is as American as baseball and apple pie. But some traditions can't be trademarked.
*photo from Newsweek (from left: Bettmann-Corbis: LOC-Corbis; Alfred Eisenstaedt / Getty Images; Jennifer Corbett / AP; Michael Grecco / Getty Images)This was an interesting and insightful article that overlapped with my old op-ed, "Coming Soon: Nontrepreneur Nation," that was published at InsideWork and Private Equity HUB last year.
Another timely and overlapping article was last week's cover story in TIME magazine, "The Growing Backlash Against Overparenting".
Zakaria's op-ed continues along his "rise of the rest" theme and focused on Asia's current and future prominence. I believe he missed an important factor in this discussion which is America's declining taste for risk and entrepreneurship. In my opinion, this is driven by overparenting and failures in our education system.
Additional commentary from Forbes' Rich Karlgaard, "Fareed Zakaria on Innovation".
A related post by By Vivek Wadhwa, Director of Research at the Center for Entrepreneurship and Research Commercialization at Duke University, "Protectionism vs. the Innovation Nation".
Tuesday, October 13, 2009
Is your product a “must have” or “nice to have”?
My tech op-ed is up at VentureBeat. Check it out:
IS YOUR PRODUCT A "MUST HAVE" OR "NICE TO HAVE"?
I also posted the version that was unedited by VentureBeat's editors at NowPublic. This original piece is chopped into two articles at VentureBeat with the second being published next week. This one is longer and I don't think they appreciated my reference to "Something About Mary" :)
IS YOUR STARTUP A "NICE TO HAVE" OR "MUST HAVE"?
With the downturn in the economy, numerous people are talking about starting a new business or company. Whether it’s a technology startup or new restaurant idea, I’ve heard of more and more people meeting to brainstorm and working to bring their ideas to fruition.
Whether you’re in the idea generation stage or have already started to build your new thing, you should take a breath and reassess whether the concept still holds your initial level of enthusiasm. Can still envision 30 million visits during the first month? Are you still as enthusiastic as you were when you came up with it? Do you believe your product or service is a “must have” and not just a “nice to have”? If not, step back – being a successful entrepreneur requires high – some say insane – levels of dedication to your idea.
There’s a great scene in the movie “Something About Mary” where Ben Stiller’s character, Ted, picks up a hitchhiker who is a psychotic killer and budding entrepreneur:
Hitchhiker: You heard of this thing, the 8-Minute Abs?
Ted: Yeah, sure, 8-Minute Abs. Yeah, the exercise video.
Hitchhiker: Yeah, this is going to blow that right out of the water. Listen to this: 7... Minute... Abs.
Ted: Right. Yes. OK, all right. I see where you're going.
Hitchhiker: Think about it. You walk into a video store, you see 8-Minute Abs sittin' there, there's 7-Minute Abs right beside it. Which one are you gonna pick, man?
Ted: I would go for the 7. Hitchhiker: Bingo, man, bingo. 7-Minute Abs. And we guarantee just as good a workout as the 8-minute folk.
Comedy aside, how familiar does this pitch sound to all you entrepreneurs or intrepreneurs out there? The reality is that the hitchhiker’s idea was a “nice to have” and wouldn’t have threatened the well-marketed 8-minute Abs video even with his insane level of dedication. Of course, he’s not similar to your pitch about your product, but does it remind you of your friends’ new thing? They all hope to have the next awesome product that will change the world, or at least get crazy traffic on Facebook. The driver of sales or user adoption? It should be as obvious as a 7 minute workout being more attractive than an 8 minute workout, right?
Most entrepreneurs are too close to their topic to realize where they really are on the user adoption curve. As an entrepreneur, you’re hoping that the jump from what Geoffrey Moore describes as “innovators” and “early adopters” to the “early majority” is short, but unfortunately, in reality, sales and user adoption rates are about as easy to predict as blockbuster movies.
Must Have, Meh, or What Does It Do Again?
For entrepreneurs, one method to frame the product development process is whether your product is a “nice to have” or a “must have.” Here, “must have” is loosely defined and can be identified by answering questions like:
• Is it easy for people to recognize that your product will save them a significant amount of time?
• Or a significant amount of money?
• Do people quickly see how much better it plays their music?
• How much better it allows them to access data?
For example, back in 2005, when I was working on my startup GoingOn Networks, we identified a trend of blogging and social networking entering the corporate world. We built a private-label social media platform, thinking that companies would soon recognize this trend and purchase our software-as-service platform.
In hindsight, the first two years were painful. A long education process, working on quelling fears of “opening up” to customers, and another long sales cycle. We were hoping our market chasm would be the neighborhood creek, but we found out it was more like the Grand Canyon. Plus, by 2007, about thirty competitors were also targeting this market. I realized that our social media platform wasn’t a “must have” and maybe not even a “nice to have” during our early years because our target market first needed to be greatly educated on the benefits of social media. It felt as if more often than not, sales meetings went like this:
Me: “Open, two-way communication with your customers is more effective…”
Potential customer: “Like a walkie-talkie?”
Me: [Sigh]
For consumer plays where users don’t pay for the product, the “must have” bar might be set a bit lower than for paid products, but it’s still a significant hurdle for the early majority to spend their time (even if it doesn’t cost money) on something new of which the benefits aren’t obvious, easy, or quick to grasp.
So how do you figure out whether your insanely great idea is likely to find customers and become a “must have”? When you’re trying to identify “must haves” in the market, consider these techniques:
Trend Surfing. Extrapolate a current technology, trend, or “must have.” What is the next product in the evolution of an industry? Consider the evolution from the Walkman to MP3 players to the iPod. Or look at what emerging technologies will create new market opportunities. For example, Qualcomm and its CDMA technology. Or exercise trends that created a whole new market of Pilates videos and trainers. My personal favorite is the rise in popularity of specialty bacon, where I can also plug my “Ode to Bacon.”
There are numerous examples, but the reality is that it’s difficult to predict and ride such trends. I learned this from GoingOn, and my prior startup, HeyAnita, when voice recognition technology was hot. With competitors such as Tellme and BeVocal, our space raised over $300 million in 2000, but quickly faded a few years later when users didn’t widely adopt a voice-controlled interface.
Twitter seems to have hit the right wave on the trend from blogging to micro-blogging. Initially, it was just an echo chamber of Silicon Valley people tweeting to each other, but now even major media outlets such as CNN, ABC, and ESPN see communicating in 140 characters as a “must have.” Like Twitter, if you do catch a trend wave, it swells, and you execute well, then you could be golden, with a profitable tech company or the best-selling line of Pilates videos on your hands.
Identifying a Market Gap. Where in the market is there an underserved need? Is there a place in the market that a taste is not being met? Chipotle filled a desire for fast casual Mexican food. Netflix let people easily rent obscure movies and keep them as long as they wanted without late fees. Meebo met the demand for a single, unified IM platform. What element is missing in a market – one that you know and are passionate about – that you believe you can fill as an entrepreneur?
For instance, back in the old days before the majority of malware came from websites and links to them, there was an opportunity for different kinds of anti-malware products. Brian Kellner, now Newsgator’s VP of Products, gave me some interesting insights into his days at anti-spyware company Webroot in the 1990s: “Webroot was one of the first two companies to release an enterprise anti-spyware product at a time when Internet Explorer had a lot of vulnerabilities and anti-virus companies didn’t catch spyware. The product was tremendously successful because it really hit the pain avoidance and laziness needs.”
But as much as Webroot tried to make deployment and management of the solution easy, when both anti-virus offerings and browser security got better, the cost of owning and running a dedicated anti-spyware solution became unattractive. “The pain level dropped significantly as anti-virus companies added adequate anti-spyware protection and it was much easier to just run the anti-virus software alone,” says Kellner.
So, for a while, Webroot was a “must have.” But when other, possibly bigger, companies start tapping into the Market Gap you found and have been filling, you need to find other ways to remain a “must have.” For example, by trying to extrapolate to the next logical “must have” in your market (Trend Surfing), or by making sure your product keeps something attractively unique about it, or is just clearly the best of its kind.
Building a Better Mousetrap. What product category is doing well, but could be done even better? Do you have an idea for something that will clearly be the best of its kind? IKEA did it for the budget-conscious furniture retail market. Zappos.com turned shoe shopping into a very convenient, easy, low-pressure experience. What features are missing that could be implemented and allow a new player to change the market? Friendster to MySpace and Facebook. MySpace and Facebook provided more value that simply connecting with friends through music and then third-party applications.
In speaking with Brian Rakowski, former lead product manager for Google’s Gmail product and current Product Management Director for its Chrome browser, he explained how he led the launches for these two products and how to make them better than any of the competitive products already out there: “Both Google Chrome and Gmail were new entrants in existing spaces so we spent a lot of time getting to know the market-leading products in their categories and identifying the biggest user pain points. For webmail, it was small storage quotas and clunky, inefficient interfaces. For browsers, it was general instability and unresponsiveness, especially on advanced webpages.” Google succeeded nicely with both of these, with Gmail surpassing Youtube earlier this year as the second-most-visited Google property and Chrome gaining just under 3% marketshare after one year. Rakowski concludes, “In the end, the best way to test whether you have a “must have” product is to threaten to take the prototype away from your early users. If they don’t riot, start again.”
Brian has a great insight here. Would users of Microsoft’s Vista have rioted if it had been taken away? No, there probably would have been celebrations throughout office buildings all over the world. What about Segway after all its hype? Maybe only mall cops would have grumbled.
Like the story of Webroot and anti-spyware becoming part of anti-virus solutions, the Building A Better Mousetrap category also brings up the importance of sustainability. How do you maintain being a “must have” in your market? During the 1990s, my favorite search engine was Alta Vista, but it didn’t maintain its “must have” status and gave way to Inktomi, which eventually gave way to Google. Google has been maintaining its “must have” status by not only staying on top of the search algorithm game, but also by offering superior or extremely competitive complementary products and services to its users: Adsense and Adwords for advertising, and nicely integrated apps like Gmail, Google Calendar, and Google Docs that make it easy to make Google your default online place to get things done. (Yet even Google has had its share of failures or incompletes such as Google Lively, Froogle, Checkout, and Spreadsheets.)
Finally, with all three of these techniques for identifying a potential “must have” opportunity – Trend Surfing, Identifying a Market Gap, and Building a Better Mousetrap – keep regularly asking yourself “is mine a “must have” product?” questions like the ones listed earlier. And of course make sure you’re still insanely excited about your own idea most days of the week – because if you’re not excited, it’ll be hard to make others think of your product as a can’t-live-without-it “must have.” But hopefully, these techniques and examples are giving you some extra inspiration on how to get to the next step in your new great idea.
IS YOUR PRODUCT A "MUST HAVE" OR "NICE TO HAVE"?
I also posted the version that was unedited by VentureBeat's editors at NowPublic. This original piece is chopped into two articles at VentureBeat with the second being published next week. This one is longer and I don't think they appreciated my reference to "Something About Mary" :)
IS YOUR STARTUP A "NICE TO HAVE" OR "MUST HAVE"?
With the downturn in the economy, numerous people are talking about starting a new business or company. Whether it’s a technology startup or new restaurant idea, I’ve heard of more and more people meeting to brainstorm and working to bring their ideas to fruition.
Whether you’re in the idea generation stage or have already started to build your new thing, you should take a breath and reassess whether the concept still holds your initial level of enthusiasm. Can still envision 30 million visits during the first month? Are you still as enthusiastic as you were when you came up with it? Do you believe your product or service is a “must have” and not just a “nice to have”? If not, step back – being a successful entrepreneur requires high – some say insane – levels of dedication to your idea.
There’s a great scene in the movie “Something About Mary” where Ben Stiller’s character, Ted, picks up a hitchhiker who is a psychotic killer and budding entrepreneur:
Hitchhiker: You heard of this thing, the 8-Minute Abs?
Ted: Yeah, sure, 8-Minute Abs. Yeah, the exercise video.
Hitchhiker: Yeah, this is going to blow that right out of the water. Listen to this: 7... Minute... Abs.
Ted: Right. Yes. OK, all right. I see where you're going.
Hitchhiker: Think about it. You walk into a video store, you see 8-Minute Abs sittin' there, there's 7-Minute Abs right beside it. Which one are you gonna pick, man?
Ted: I would go for the 7. Hitchhiker: Bingo, man, bingo. 7-Minute Abs. And we guarantee just as good a workout as the 8-minute folk.
Comedy aside, how familiar does this pitch sound to all you entrepreneurs or intrepreneurs out there? The reality is that the hitchhiker’s idea was a “nice to have” and wouldn’t have threatened the well-marketed 8-minute Abs video even with his insane level of dedication. Of course, he’s not similar to your pitch about your product, but does it remind you of your friends’ new thing? They all hope to have the next awesome product that will change the world, or at least get crazy traffic on Facebook. The driver of sales or user adoption? It should be as obvious as a 7 minute workout being more attractive than an 8 minute workout, right?
Most entrepreneurs are too close to their topic to realize where they really are on the user adoption curve. As an entrepreneur, you’re hoping that the jump from what Geoffrey Moore describes as “innovators” and “early adopters” to the “early majority” is short, but unfortunately, in reality, sales and user adoption rates are about as easy to predict as blockbuster movies.
Must Have, Meh, or What Does It Do Again?
For entrepreneurs, one method to frame the product development process is whether your product is a “nice to have” or a “must have.” Here, “must have” is loosely defined and can be identified by answering questions like:
• Is it easy for people to recognize that your product will save them a significant amount of time?
• Or a significant amount of money?
• Do people quickly see how much better it plays their music?
• How much better it allows them to access data?
For example, back in 2005, when I was working on my startup GoingOn Networks, we identified a trend of blogging and social networking entering the corporate world. We built a private-label social media platform, thinking that companies would soon recognize this trend and purchase our software-as-service platform.
In hindsight, the first two years were painful. A long education process, working on quelling fears of “opening up” to customers, and another long sales cycle. We were hoping our market chasm would be the neighborhood creek, but we found out it was more like the Grand Canyon. Plus, by 2007, about thirty competitors were also targeting this market. I realized that our social media platform wasn’t a “must have” and maybe not even a “nice to have” during our early years because our target market first needed to be greatly educated on the benefits of social media. It felt as if more often than not, sales meetings went like this:
Me: “Open, two-way communication with your customers is more effective…”
Potential customer: “Like a walkie-talkie?”
Me: [Sigh]
For consumer plays where users don’t pay for the product, the “must have” bar might be set a bit lower than for paid products, but it’s still a significant hurdle for the early majority to spend their time (even if it doesn’t cost money) on something new of which the benefits aren’t obvious, easy, or quick to grasp.
So how do you figure out whether your insanely great idea is likely to find customers and become a “must have”? When you’re trying to identify “must haves” in the market, consider these techniques:
Trend Surfing. Extrapolate a current technology, trend, or “must have.” What is the next product in the evolution of an industry? Consider the evolution from the Walkman to MP3 players to the iPod. Or look at what emerging technologies will create new market opportunities. For example, Qualcomm and its CDMA technology. Or exercise trends that created a whole new market of Pilates videos and trainers. My personal favorite is the rise in popularity of specialty bacon, where I can also plug my “Ode to Bacon.”
There are numerous examples, but the reality is that it’s difficult to predict and ride such trends. I learned this from GoingOn, and my prior startup, HeyAnita, when voice recognition technology was hot. With competitors such as Tellme and BeVocal, our space raised over $300 million in 2000, but quickly faded a few years later when users didn’t widely adopt a voice-controlled interface.
Twitter seems to have hit the right wave on the trend from blogging to micro-blogging. Initially, it was just an echo chamber of Silicon Valley people tweeting to each other, but now even major media outlets such as CNN, ABC, and ESPN see communicating in 140 characters as a “must have.” Like Twitter, if you do catch a trend wave, it swells, and you execute well, then you could be golden, with a profitable tech company or the best-selling line of Pilates videos on your hands.
Identifying a Market Gap. Where in the market is there an underserved need? Is there a place in the market that a taste is not being met? Chipotle filled a desire for fast casual Mexican food. Netflix let people easily rent obscure movies and keep them as long as they wanted without late fees. Meebo met the demand for a single, unified IM platform. What element is missing in a market – one that you know and are passionate about – that you believe you can fill as an entrepreneur?
For instance, back in the old days before the majority of malware came from websites and links to them, there was an opportunity for different kinds of anti-malware products. Brian Kellner, now Newsgator’s VP of Products, gave me some interesting insights into his days at anti-spyware company Webroot in the 1990s: “Webroot was one of the first two companies to release an enterprise anti-spyware product at a time when Internet Explorer had a lot of vulnerabilities and anti-virus companies didn’t catch spyware. The product was tremendously successful because it really hit the pain avoidance and laziness needs.”
But as much as Webroot tried to make deployment and management of the solution easy, when both anti-virus offerings and browser security got better, the cost of owning and running a dedicated anti-spyware solution became unattractive. “The pain level dropped significantly as anti-virus companies added adequate anti-spyware protection and it was much easier to just run the anti-virus software alone,” says Kellner.
So, for a while, Webroot was a “must have.” But when other, possibly bigger, companies start tapping into the Market Gap you found and have been filling, you need to find other ways to remain a “must have.” For example, by trying to extrapolate to the next logical “must have” in your market (Trend Surfing), or by making sure your product keeps something attractively unique about it, or is just clearly the best of its kind.
Building a Better Mousetrap. What product category is doing well, but could be done even better? Do you have an idea for something that will clearly be the best of its kind? IKEA did it for the budget-conscious furniture retail market. Zappos.com turned shoe shopping into a very convenient, easy, low-pressure experience. What features are missing that could be implemented and allow a new player to change the market? Friendster to MySpace and Facebook. MySpace and Facebook provided more value that simply connecting with friends through music and then third-party applications.
In speaking with Brian Rakowski, former lead product manager for Google’s Gmail product and current Product Management Director for its Chrome browser, he explained how he led the launches for these two products and how to make them better than any of the competitive products already out there: “Both Google Chrome and Gmail were new entrants in existing spaces so we spent a lot of time getting to know the market-leading products in their categories and identifying the biggest user pain points. For webmail, it was small storage quotas and clunky, inefficient interfaces. For browsers, it was general instability and unresponsiveness, especially on advanced webpages.” Google succeeded nicely with both of these, with Gmail surpassing Youtube earlier this year as the second-most-visited Google property and Chrome gaining just under 3% marketshare after one year. Rakowski concludes, “In the end, the best way to test whether you have a “must have” product is to threaten to take the prototype away from your early users. If they don’t riot, start again.”
Brian has a great insight here. Would users of Microsoft’s Vista have rioted if it had been taken away? No, there probably would have been celebrations throughout office buildings all over the world. What about Segway after all its hype? Maybe only mall cops would have grumbled.
Like the story of Webroot and anti-spyware becoming part of anti-virus solutions, the Building A Better Mousetrap category also brings up the importance of sustainability. How do you maintain being a “must have” in your market? During the 1990s, my favorite search engine was Alta Vista, but it didn’t maintain its “must have” status and gave way to Inktomi, which eventually gave way to Google. Google has been maintaining its “must have” status by not only staying on top of the search algorithm game, but also by offering superior or extremely competitive complementary products and services to its users: Adsense and Adwords for advertising, and nicely integrated apps like Gmail, Google Calendar, and Google Docs that make it easy to make Google your default online place to get things done. (Yet even Google has had its share of failures or incompletes such as Google Lively, Froogle, Checkout, and Spreadsheets.)
Finally, with all three of these techniques for identifying a potential “must have” opportunity – Trend Surfing, Identifying a Market Gap, and Building a Better Mousetrap – keep regularly asking yourself “is mine a “must have” product?” questions like the ones listed earlier. And of course make sure you’re still insanely excited about your own idea most days of the week – because if you’re not excited, it’ll be hard to make others think of your product as a can’t-live-without-it “must have.” But hopefully, these techniques and examples are giving you some extra inspiration on how to get to the next step in your new great idea.
Monday, October 5, 2009
Did You Know 4.0
HatTip to Dan W. Updated video on how "a surge of new technologies and social media innovations is altering the media landscape." It's also amazing to think that a majority of this driven by a small area in our world called Silicon Valley.
Love the prior version...
Love the prior version...
Wednesday, August 19, 2009
Wokai, A Donation-Microloan Hybrid in China
Great innovation and story from China. Since Kiva or a Kiva-like platform couldn't be launched in China due to its monetary policy, two entrepreneurs started Wokai, a nonprofit organization. More from Springwise:
"Dedicated to raising capital from around the world for entrepreneurs in rural China, Wokai works with field partners to select candidates for loans. Using a system that's similar to Kiva, people can browse a list of potential borrowers on Wokai's website, donate their chosen amount, and then track the recipient's progress through Wokai. Since they can't be paid back to the donor, loans are recycled: when a recipient pays back a loan to Wokai, the donor can select another farmer or entrepreneur to support. So far, Wokai has raised USD 42,766 for loans to 159 recipients. Many donors have business or family ties to China."
"Dedicated to raising capital from around the world for entrepreneurs in rural China, Wokai works with field partners to select candidates for loans. Using a system that's similar to Kiva, people can browse a list of potential borrowers on Wokai's website, donate their chosen amount, and then track the recipient's progress through Wokai. Since they can't be paid back to the donor, loans are recycled: when a recipient pays back a loan to Wokai, the donor can select another farmer or entrepreneur to support. So far, Wokai has raised USD 42,766 for loans to 159 recipients. Many donors have business or family ties to China."
Wednesday, March 11, 2009
The Fast Company 50: The World's Most Innovative Companies... Silicon Valley's Engine Still Roars
Fast Company is out with there "Fast Company 50," a list of the world's most innovative companies. Out of the top ten, 6 are Silicon Valley companies, Hulu is made up of Silicon Valley veterans, one Chinese company (WuXi PharmaTech), and Amazon. In the top twenty are 9 Silicon Valley companies. Roar!
Friday, January 30, 2009
"How Big Companies Kill Innovation" by Eduardo Sciammarella
Eduardo Sciammarella, Founder and CEO of Protomobl, has good post here.
The classic challenge inside large companies is for the business units to think beyond the coming quarter, next model or feature. While they race to capture the revenue stream that exists today, new entrants disrupt the market. Often, companies will have R&D groups that are flush with innovative ideas but completely disconnected from the business units. One of the ways to overcome this is to have the R&D group and the business unit agree on a time frame and a shared vision. The R&D group can then go off and execute in line with that vision, with the business unit's buy-in. This is important inside a large company - but buy-in alone does not equate with successful innovation.
The challenge outside is different. Sometimes, large companies approach small start-ups to see how they can benefit from each other. This can be a very risky proposition for a start-up. You must be hyper aware of the fact that everything is going to take much longer than you anticipate. Alternatively, large companies should be very careful about engaging small start-ups. If you are a large company thinking about approaching a start-up, make sure you have a clear goal with a set time-line and budget on hand. If you don't have all these things, please don't waste their time. Time is the life-blood of a start-up...
The classic challenge inside large companies is for the business units to think beyond the coming quarter, next model or feature. While they race to capture the revenue stream that exists today, new entrants disrupt the market. Often, companies will have R&D groups that are flush with innovative ideas but completely disconnected from the business units. One of the ways to overcome this is to have the R&D group and the business unit agree on a time frame and a shared vision. The R&D group can then go off and execute in line with that vision, with the business unit's buy-in. This is important inside a large company - but buy-in alone does not equate with successful innovation.
The challenge outside is different. Sometimes, large companies approach small start-ups to see how they can benefit from each other. This can be a very risky proposition for a start-up. You must be hyper aware of the fact that everything is going to take much longer than you anticipate. Alternatively, large companies should be very careful about engaging small start-ups. If you are a large company thinking about approaching a start-up, make sure you have a clear goal with a set time-line and budget on hand. If you don't have all these things, please don't waste their time. Time is the life-blood of a start-up...
Wednesday, December 24, 2008
Tech Trends for 2009 — This Time Global
Last year, I limited my predictions to the U.S. market. But the global economic meltdown has made the world flatter — and landed our nation flat broke. So to keep things interesting, I’ll extend my prognostication across borders.
I was playing with the idea of titling this column “Top Ten Tech Bailouts for 2009″ or “DeathCrunch: 2009,” but thought it best to keep our VentureBeat readers in high spirits (what with the holiday cheer and all). So without further ado, here are my top global trends to watch for the new year:
PC and online gaming continue healthy growth
There is no better indicator of this than World of Warcraft’s Wrath of the Lich King’s first-day sale of 2.8 million copies in mid-November. At $40 each, this accounts for $112 million, an astounding figure. I imagine the folks at Blizzard Entertainment had a pretty nice holiday party — drinking eggnog and munching on gingerbread cookies, macaroons and Turkish Delight to their hearts’ content…
And it’s not just the geeks keeping this segment of the market afloat either. Remember Swingers? Solid proof that cool, hip, unemployed men (and there will be many more of them) tend to play a lot of games.
But does this mean that all video game companies are recession-proof? Will that many more people opt for lazy, relatively inexpensive entertainment over going out? Not really. The NPD Group, a leading consumer market research firm, recently issued a report showing a dip in the overall video game market. October saw an 18 percent increase over sales from last year, but November’s sales were only up 10 percent. So the downturn is in fact taking a toll.
Console sales — which made up $9.4 billion of the $18.9 billion gaming industry in 2007 (according to the Entertainment Software Association) — will take a major hit. How many people will be willing to drop a few hundred bucks on a console? Plus $50 more for a game easily finished in a few days or weeks? That’s a lot to ask in the current environment. Even perennial favorites like Rock Band and Wii Fit will probably trend down due to expensive accessories.
PC and online gaming account for only 9.5 percent of total gaming sales ($9.5 billion). But the segment has the strongest prospects for growth. MMORPGs (massively-multiplayer online role-playing games) and others with multi-dimensional interaction options provide continuous character development, storylines and gameplay that bring you into contact with likeminded others. This gives them longevity and makes them worthier of that initial investment.
Video game makers should take note: Titles that deliver more value over a longer period of time will bring in more money during tough times — and that’s exactly what PC and online games do.
Surface computing slowly breaks into the mainstream
Traditional mouse and keyboard setups will start to be replaced by touch-sensitive screens that allow users to control functions with their fingertips. Hewlett-Packard’s TouchSmart PC is just the beginning.
I’m far from becoming a Microsoft fan, but Microsoft Surface is an important step forward for this technology, which will only become more pervasive in the next year. And Microsoft isn’t the only player in the game. As a TEDster, I have to plug Jeff Han’s multi-touch interface (see video below). All the while, Innotive, a company I advised, offers very cool interactive display technology.
The novelty of surface computing has led Microsoft into partnerships with Sheraton Hotels, Disney and Harrah’s Casino Hotels. These resorts have installed touch screens in their lobbies to provide local information and media tailored to their customers’ needs. The technology may only be mindly entertaining for now, but it provides substantial practical value. With the ubiquity of the iPhone, multi-touch screens are becoming increasingly intuitive, and already feel more natural than typing on a keypad in some settings. Say, for example, you are presented with a multi-touch screen as a menu in a restaurant — one click with your finger orders your meal.
But there’s even more potential in the boardroom with smart white boards becoming a reality. Imagine all the graphic facilitation geeks in your office suddenly gaining the ability to map out their ideas with just their hands? Joyous pandemonium! Dry-erase marker bonfires amid hearty rounds of Kumbaya! (At least that’s how I picture it.)
Shift from offline to online ad spend picks up speed
Advertising goliath GroupM projects that global ad spend will decrease by 0.2 percent to $458 billion in 2009 — dropping 3.2 percent to $157 billion in the U.S. alone. But I think online ad spend is a different story, and should see slow but steady growth. After all, eMarketer forecasts an 8.8 percent increase in online ad spend from $23.6 to $25.7 billion in 2009, and a 10.8 percent increase in 2010.
What will drive this growth? In short, more advertisers waking up to smell the recession. Newspapers make up only 5 percent of Americans’ media diet, yet they consume 30 percent of ad dollars. A report from Morgan Stanley last month revealed that, last year, advertisers spent $288 per home on internet advertising and $818 per home on newspaper ads. There’s something wrong with that picture when “death spiral” is the phrase usually ascribed to the state of print journalism. And more brands are starting to realize it — newspaper advertising has dropped 18 percent (about $2 billion) from this quarter last year.
Innovation increasingly imported from Asia
I appreciate Fareed Zakaria’s vision of a post-American world, but if we’re talking about 2009, I’d narrow it down to just Asia. Already, China and India produce five times as many engineers as the U.S., and it’s predicted that 90 percent of all engineers will hail from Asia by 2011. Yes, as in two years from now.
For the time being, the U.S. leads in R&D worldwide with 35 percent of the total output. China comes in second with 16 percent, and Japan in third with 13 percent — but both are catching up fast. The money is there, no doubt. It’s the culture of creativity and entrepreneurship that will really give these countries the boost they need. Innovation and idea generation are fairly strong in Japan and Korea, and have been picking up in China and India due to improving education and a reverse diaspora. Taking these factors into account, Asia is clearly poised to overtake the west in technological achievement in the coming decade.
As a student of Czech economist Joseph Schumpeter and Columbia University’s Richard Nelson, I believe that this type of achievement is the primary driver for long-term economic growth. With its workforce dominating engineering, its growing entrepreneurial spirit and its hunger for knowledge, Asia is positioning itself as the world’s primary economic engine — with the potential to reign indefinitely.
Regardless, the U.S. will maintain its leadership in innovation through the end of next year, but perhaps not long after that. Will Asia’s brute strength in the tech arena outweigh cultural, legal and policy limitations?
This is a question not just for 2009, but the next five or even ten years. For now, these are my predictions for the year ahead. Do you agree? What global trends do you taking hold in 2009 and beyond?
Originally posted at VentureBeat.
I was playing with the idea of titling this column “Top Ten Tech Bailouts for 2009″ or “DeathCrunch: 2009,” but thought it best to keep our VentureBeat readers in high spirits (what with the holiday cheer and all). So without further ado, here are my top global trends to watch for the new year:
PC and online gaming continue healthy growth
There is no better indicator of this than World of Warcraft’s Wrath of the Lich King’s first-day sale of 2.8 million copies in mid-November. At $40 each, this accounts for $112 million, an astounding figure. I imagine the folks at Blizzard Entertainment had a pretty nice holiday party — drinking eggnog and munching on gingerbread cookies, macaroons and Turkish Delight to their hearts’ content…
And it’s not just the geeks keeping this segment of the market afloat either. Remember Swingers? Solid proof that cool, hip, unemployed men (and there will be many more of them) tend to play a lot of games.
But does this mean that all video game companies are recession-proof? Will that many more people opt for lazy, relatively inexpensive entertainment over going out? Not really. The NPD Group, a leading consumer market research firm, recently issued a report showing a dip in the overall video game market. October saw an 18 percent increase over sales from last year, but November’s sales were only up 10 percent. So the downturn is in fact taking a toll.
Console sales — which made up $9.4 billion of the $18.9 billion gaming industry in 2007 (according to the Entertainment Software Association) — will take a major hit. How many people will be willing to drop a few hundred bucks on a console? Plus $50 more for a game easily finished in a few days or weeks? That’s a lot to ask in the current environment. Even perennial favorites like Rock Band and Wii Fit will probably trend down due to expensive accessories.
PC and online gaming account for only 9.5 percent of total gaming sales ($9.5 billion). But the segment has the strongest prospects for growth. MMORPGs (massively-multiplayer online role-playing games) and others with multi-dimensional interaction options provide continuous character development, storylines and gameplay that bring you into contact with likeminded others. This gives them longevity and makes them worthier of that initial investment.
Video game makers should take note: Titles that deliver more value over a longer period of time will bring in more money during tough times — and that’s exactly what PC and online games do.
Surface computing slowly breaks into the mainstream
Traditional mouse and keyboard setups will start to be replaced by touch-sensitive screens that allow users to control functions with their fingertips. Hewlett-Packard’s TouchSmart PC is just the beginning.
I’m far from becoming a Microsoft fan, but Microsoft Surface is an important step forward for this technology, which will only become more pervasive in the next year. And Microsoft isn’t the only player in the game. As a TEDster, I have to plug Jeff Han’s multi-touch interface (see video below). All the while, Innotive, a company I advised, offers very cool interactive display technology.
The novelty of surface computing has led Microsoft into partnerships with Sheraton Hotels, Disney and Harrah’s Casino Hotels. These resorts have installed touch screens in their lobbies to provide local information and media tailored to their customers’ needs. The technology may only be mindly entertaining for now, but it provides substantial practical value. With the ubiquity of the iPhone, multi-touch screens are becoming increasingly intuitive, and already feel more natural than typing on a keypad in some settings. Say, for example, you are presented with a multi-touch screen as a menu in a restaurant — one click with your finger orders your meal.
But there’s even more potential in the boardroom with smart white boards becoming a reality. Imagine all the graphic facilitation geeks in your office suddenly gaining the ability to map out their ideas with just their hands? Joyous pandemonium! Dry-erase marker bonfires amid hearty rounds of Kumbaya! (At least that’s how I picture it.)
Shift from offline to online ad spend picks up speed
Advertising goliath GroupM projects that global ad spend will decrease by 0.2 percent to $458 billion in 2009 — dropping 3.2 percent to $157 billion in the U.S. alone. But I think online ad spend is a different story, and should see slow but steady growth. After all, eMarketer forecasts an 8.8 percent increase in online ad spend from $23.6 to $25.7 billion in 2009, and a 10.8 percent increase in 2010.
What will drive this growth? In short, more advertisers waking up to smell the recession. Newspapers make up only 5 percent of Americans’ media diet, yet they consume 30 percent of ad dollars. A report from Morgan Stanley last month revealed that, last year, advertisers spent $288 per home on internet advertising and $818 per home on newspaper ads. There’s something wrong with that picture when “death spiral” is the phrase usually ascribed to the state of print journalism. And more brands are starting to realize it — newspaper advertising has dropped 18 percent (about $2 billion) from this quarter last year.
Innovation increasingly imported from Asia
I appreciate Fareed Zakaria’s vision of a post-American world, but if we’re talking about 2009, I’d narrow it down to just Asia. Already, China and India produce five times as many engineers as the U.S., and it’s predicted that 90 percent of all engineers will hail from Asia by 2011. Yes, as in two years from now.
For the time being, the U.S. leads in R&D worldwide with 35 percent of the total output. China comes in second with 16 percent, and Japan in third with 13 percent — but both are catching up fast. The money is there, no doubt. It’s the culture of creativity and entrepreneurship that will really give these countries the boost they need. Innovation and idea generation are fairly strong in Japan and Korea, and have been picking up in China and India due to improving education and a reverse diaspora. Taking these factors into account, Asia is clearly poised to overtake the west in technological achievement in the coming decade.
As a student of Czech economist Joseph Schumpeter and Columbia University’s Richard Nelson, I believe that this type of achievement is the primary driver for long-term economic growth. With its workforce dominating engineering, its growing entrepreneurial spirit and its hunger for knowledge, Asia is positioning itself as the world’s primary economic engine — with the potential to reign indefinitely.
Regardless, the U.S. will maintain its leadership in innovation through the end of next year, but perhaps not long after that. Will Asia’s brute strength in the tech arena outweigh cultural, legal and policy limitations?
This is a question not just for 2009, but the next five or even ten years. For now, these are my predictions for the year ahead. Do you agree? What global trends do you taking hold in 2009 and beyond?
Originally posted at VentureBeat.
Wednesday, November 5, 2008
"Repeal Sarbanes-Oxley" by Newt Gingrich
Great call for action by Gingrich. Not a conservative thing or liberal thing, but a common sense move for our economy and its future.
Repeal Sarbanes-Oxley
by Newt Gingrich and David W. Kralik
It has been six years since Congress passed the Sarbanes-Oxley Act after the devastating accounting irregularities of Enron and WorldCom. While the intent of the law was to prevent corporate fraud, there is growing evidence that it has done more harm than good, and is undermining the venture-capital industry in Silicon Valley. Now, with signs that our economy is moving toward recession, Congress should take this opportunity to repeal the law.
Rep. Michael G. Oxley, R-Ohio, recently said in an interview with the International Herald Tribune that Sarbanes-Oxley was passed in haste. "Frankly, I would have written it differently. ... Everyone felt like Rome was burning."
Sarbanes-Oxley went too far in regulating corporate governance, resulting in at least three unintended consequences.
-- It was insufficient at preventing insolvencies and accounting shortfalls in companies such as Bear Sterns, Lehman Bros., American International Group (AIG) and Merrill Lynch.
Estimates from leading figures in the venture-capital community indicate the average company will now take 12 years before it can successfully issue an initial public offering (up from five years pre-Sarbanes-Oxley) because they do not have enough capital to cover the estimated $4.36 million hidden tax in yearly compliance costs, according to an estimate by the Financial Executives International... (full article)
Repeal Sarbanes-Oxley
by Newt Gingrich and David W. Kralik
It has been six years since Congress passed the Sarbanes-Oxley Act after the devastating accounting irregularities of Enron and WorldCom. While the intent of the law was to prevent corporate fraud, there is growing evidence that it has done more harm than good, and is undermining the venture-capital industry in Silicon Valley. Now, with signs that our economy is moving toward recession, Congress should take this opportunity to repeal the law.
Rep. Michael G. Oxley, R-Ohio, recently said in an interview with the International Herald Tribune that Sarbanes-Oxley was passed in haste. "Frankly, I would have written it differently. ... Everyone felt like Rome was burning."
Sarbanes-Oxley went too far in regulating corporate governance, resulting in at least three unintended consequences.
-- It was insufficient at preventing insolvencies and accounting shortfalls in companies such as Bear Sterns, Lehman Bros., American International Group (AIG) and Merrill Lynch.
Estimates from leading figures in the venture-capital community indicate the average company will now take 12 years before it can successfully issue an initial public offering (up from five years pre-Sarbanes-Oxley) because they do not have enough capital to cover the estimated $4.36 million hidden tax in yearly compliance costs, according to an estimate by the Financial Executives International... (full article)
Monday, April 21, 2008
Coming Soon: Nontrepreneur Nation
My article went up at Insidework (defunct site now) today.
Also Daniel Primack, whose email newsletter I've been reading for years, at Private Equity HUB was nice enough to repost this article at his news site here. Some discussions going on at both sites. Join the conversation!
Coming Soon: Nontrepreneur Nation
How parenting and education are killing American entrepreneurship and innovation
Despite how U.S. students continue to lag far behind those in Singapore, Taiwan, South Korea, Hong Kong, and Japan in math and science and score comparable to European students (The New York Times, 11/14/07), I was never concerned about the welfare of our nation. Even though, for more than a decade, U.S. students typically placed outside the top ten in the Trends in International Mathematics and Science Study (TIMSS).
Why wasn’t I worried? The U.S. still leads in the number of patents awarded, in its disproportionate amount of Nobel Prize winners in the sciences, and in the number of entrepreneurial ventures started each year. The U.S. rewards creativity with programs and prizes such as the MacArthur Fellows Program and numerous “entrepreneur of the year” awards. Confident about our unique culture and emphasis on creativity and entrepreneurship, I strongly believed that our national innovation engine would continue to lead in technology and entrepreneurship for decades to come.
However, recently I have begun to feel as though I am on shaky ground, confronting fears of collapse in our city on the hill. The current crop of U.S. students – what should become the next generation of scientists and entrepreneurs – shows strong characteristics that counter the unique culture of innovation on which our country built itself, and our future is at risk.
Around me, in various circles of my life, I’ve been seeing anecdotal evidence to bolster this concern.
Last week I came back from a college student conference where I serve as an adviser. The conference was started 22 years ago and typically has 500-1000 students attend each year, and I’ve been involved since 1992. Of late, we have recognized a trend among these student organizers, who are ambitious leaders on their campuses. Over the past five years there has been a change in their mentality. More and more, the student leaders were asking for guidance and hand-holding throughout the effort of organizing this conference. This was a strange experience for us, because previously the student organizers wanted more independence, and were pushing our boundaries. Today’s student organizers generally wanted to be told what to do instead of taking their own initiative – while, oddly enough, sometimes a greater degree of pretentiousness and sense of entitlement crop up.
Last year, I was speaking with a friend who is a school administrator in New York City about this trend I noticed. She agreed with my observation. In high schools, she also saw recent changes in students, where they want more guidance and reveal an increasing fear of failure. She recalled one conversation where she was talking with a student about why this student decided not to take Spanish:
“So why did you decide to not take the class?”
“Because I don’t know Spanish, so I’ll probably fail.”
“Well, that’s why you’re supposed to take it, so you can learn something you don’t know.”
My friend told me that these types of conversations with students – where uncertainty and the unknown are avoided rather than confronted – are becoming more common for her.
So I began to consider the some of the causes for this lack of entrepreneurial spirit among students. I remember raising an eyebrow when in 1996, a few years after I graduated from college, the Educational Testing Service adjusted its scoring because the national average was dropping. A 730 verbal on the old scale would be awarded a perfect 800 on the new scale, and a math score of 780 on the old scale would get 800 on the new scale. Even in today’s new SAT Reasoning Test, a “perfect” isn’t a truly perfect score. I also remember grade inflation starting to happen while I was in college, when some universities began taking “Fs” out of their system. At Harvard in the early 2000s, 90 percent or more of students graduated with honors. And in 2003, The Washington Post’s Stuart Rojstaczer noted that fully half of all grades given at Pomona, Duke, Harvard, and Columbia are “As.”
In Denise Shekerjian’s book Uncommon Genius, she searched for the essence of creativity by following 40 winners of the MacArthur Prize (also known as the “genius award”). Some of the key characteristics she chronicled: the Fellows’ ability to take risks, and how they built resiliency. Resiliency comes from facing your mistakes and failures, and learning that failure is a path to success. Being resilient and able to take risks are characteristics that are also clearly necessary for entrepreneurship, as most successful entrepreneurs have failed at least once. From numerous veterans of Silicon Valley to local hometown entrepreneurs, failure is a badge of honor.
Yet for the past decade, we have been conditioning our next generation of would-be leaders, entrepreneurs, and scientists to avoid risks by letting them opt out of classes or exams they might not ace, we’ve been protecting them from failure with grade inflation, and we’ve been inflating their self-worth with scoring adjustments.
And the result? These actions have been destructive to this generation and to our nation. There have been additional adverse effects from this risk-avoidance approach. A 2004 article in Psychology Today, A Nation of Wimps, states that in 1996, anxiety overtook relationship concerns as the major problem cited by students, and The University of Michigan Depression Center estimated that depression affects 15 percent of college students nationwide.
Just a few weeks ago, I had a conversation with my colleague Dan Wooldridge, a leadership consultant, about the recent entrants from Generation Y into the workplace. He said that companies have had to adjust because this was the first generation parented by “soccer moms” – every minute of their children’s lives have been scripted and scheduled from soccer to piano to church activities to social events.
“The kids are dropped off and picked up and taken to the next event on the schedule. They have not learned how to spontaneously organize or manage themselves, and so when they enter the workplace, they need more instruction, structure, and coddling. Also because their parents have so managed the risks they face and so trying things that might result in failure is absolutely terrifying,” he explained. He continued to state that this group’s strengths are multi-tasking, grew up in diversity, more optimistic than the previous generation, and can be very self-confident.
The parents of this generation have created a competitive frenzy for schooling and an abundance of “high achievers.” At the same time, they have promoted an environment of dependency on a parental figure, which is what I’ve been experiencing first-hand.
Today, failure is still accepted in our society. But burgeoning undercurrents from our education system and the latest parental practices are threatening this valuable idea – that failure and learning from it can lead to success – which helps fuel our national innovation engine.
I am deeply concerned about the future of innovation and entrepreneurship in our nation, which is so strongly tied to its economic growth. To reestablish ourselves, we need a closer examination of our education system – and possibly wholesale changes in testing, grading, and teaching. For every Mark Zuckerberg or Matt Mullenweg who rises up from today’s generation of students, hundreds of thousands of future entrepreneurs, scientists, and leaders are not able to overcome their conditioning of dependency and doubt. My fear is that we are creating a nation of “nontrepreneurs,” and that because of our eroding entrepreneurial spirit we are losing future contributors to not only the U.S., but to the world.
So – Americans, world citizens – what should we do about this?
UPDATE: Mike Lanza pointed me to his post on this topic, "We’re Raising a Generation of Organization Men (or Women)" and The Atlantic Monthly's David Brook's article, "The Organization Kid," from April 2001.
A indirectly related issue is discussed by George Will, "A Nation Held Back By (Lack of) Education"
education, innovation, entrepreneurship, parenting, startups, mark zuckerberg, matt mullenweg
Also Daniel Primack, whose email newsletter I've been reading for years, at Private Equity HUB was nice enough to repost this article at his news site here. Some discussions going on at both sites. Join the conversation!
Coming Soon: Nontrepreneur Nation
How parenting and education are killing American entrepreneurship and innovation
Despite how U.S. students continue to lag far behind those in Singapore, Taiwan, South Korea, Hong Kong, and Japan in math and science and score comparable to European students (The New York Times, 11/14/07), I was never concerned about the welfare of our nation. Even though, for more than a decade, U.S. students typically placed outside the top ten in the Trends in International Mathematics and Science Study (TIMSS).
Why wasn’t I worried? The U.S. still leads in the number of patents awarded, in its disproportionate amount of Nobel Prize winners in the sciences, and in the number of entrepreneurial ventures started each year. The U.S. rewards creativity with programs and prizes such as the MacArthur Fellows Program and numerous “entrepreneur of the year” awards. Confident about our unique culture and emphasis on creativity and entrepreneurship, I strongly believed that our national innovation engine would continue to lead in technology and entrepreneurship for decades to come.
However, recently I have begun to feel as though I am on shaky ground, confronting fears of collapse in our city on the hill. The current crop of U.S. students – what should become the next generation of scientists and entrepreneurs – shows strong characteristics that counter the unique culture of innovation on which our country built itself, and our future is at risk.
Around me, in various circles of my life, I’ve been seeing anecdotal evidence to bolster this concern.
Last week I came back from a college student conference where I serve as an adviser. The conference was started 22 years ago and typically has 500-1000 students attend each year, and I’ve been involved since 1992. Of late, we have recognized a trend among these student organizers, who are ambitious leaders on their campuses. Over the past five years there has been a change in their mentality. More and more, the student leaders were asking for guidance and hand-holding throughout the effort of organizing this conference. This was a strange experience for us, because previously the student organizers wanted more independence, and were pushing our boundaries. Today’s student organizers generally wanted to be told what to do instead of taking their own initiative – while, oddly enough, sometimes a greater degree of pretentiousness and sense of entitlement crop up.
Last year, I was speaking with a friend who is a school administrator in New York City about this trend I noticed. She agreed with my observation. In high schools, she also saw recent changes in students, where they want more guidance and reveal an increasing fear of failure. She recalled one conversation where she was talking with a student about why this student decided not to take Spanish:
“So why did you decide to not take the class?”
“Because I don’t know Spanish, so I’ll probably fail.”
“Well, that’s why you’re supposed to take it, so you can learn something you don’t know.”
My friend told me that these types of conversations with students – where uncertainty and the unknown are avoided rather than confronted – are becoming more common for her.
So I began to consider the some of the causes for this lack of entrepreneurial spirit among students. I remember raising an eyebrow when in 1996, a few years after I graduated from college, the Educational Testing Service adjusted its scoring because the national average was dropping. A 730 verbal on the old scale would be awarded a perfect 800 on the new scale, and a math score of 780 on the old scale would get 800 on the new scale. Even in today’s new SAT Reasoning Test, a “perfect” isn’t a truly perfect score. I also remember grade inflation starting to happen while I was in college, when some universities began taking “Fs” out of their system. At Harvard in the early 2000s, 90 percent or more of students graduated with honors. And in 2003, The Washington Post’s Stuart Rojstaczer noted that fully half of all grades given at Pomona, Duke, Harvard, and Columbia are “As.”
In Denise Shekerjian’s book Uncommon Genius, she searched for the essence of creativity by following 40 winners of the MacArthur Prize (also known as the “genius award”). Some of the key characteristics she chronicled: the Fellows’ ability to take risks, and how they built resiliency. Resiliency comes from facing your mistakes and failures, and learning that failure is a path to success. Being resilient and able to take risks are characteristics that are also clearly necessary for entrepreneurship, as most successful entrepreneurs have failed at least once. From numerous veterans of Silicon Valley to local hometown entrepreneurs, failure is a badge of honor.
Yet for the past decade, we have been conditioning our next generation of would-be leaders, entrepreneurs, and scientists to avoid risks by letting them opt out of classes or exams they might not ace, we’ve been protecting them from failure with grade inflation, and we’ve been inflating their self-worth with scoring adjustments.
And the result? These actions have been destructive to this generation and to our nation. There have been additional adverse effects from this risk-avoidance approach. A 2004 article in Psychology Today, A Nation of Wimps, states that in 1996, anxiety overtook relationship concerns as the major problem cited by students, and The University of Michigan Depression Center estimated that depression affects 15 percent of college students nationwide.
Just a few weeks ago, I had a conversation with my colleague Dan Wooldridge, a leadership consultant, about the recent entrants from Generation Y into the workplace. He said that companies have had to adjust because this was the first generation parented by “soccer moms” – every minute of their children’s lives have been scripted and scheduled from soccer to piano to church activities to social events.
“The kids are dropped off and picked up and taken to the next event on the schedule. They have not learned how to spontaneously organize or manage themselves, and so when they enter the workplace, they need more instruction, structure, and coddling. Also because their parents have so managed the risks they face and so trying things that might result in failure is absolutely terrifying,” he explained. He continued to state that this group’s strengths are multi-tasking, grew up in diversity, more optimistic than the previous generation, and can be very self-confident.
The parents of this generation have created a competitive frenzy for schooling and an abundance of “high achievers.” At the same time, they have promoted an environment of dependency on a parental figure, which is what I’ve been experiencing first-hand.
Today, failure is still accepted in our society. But burgeoning undercurrents from our education system and the latest parental practices are threatening this valuable idea – that failure and learning from it can lead to success – which helps fuel our national innovation engine.
I am deeply concerned about the future of innovation and entrepreneurship in our nation, which is so strongly tied to its economic growth. To reestablish ourselves, we need a closer examination of our education system – and possibly wholesale changes in testing, grading, and teaching. For every Mark Zuckerberg or Matt Mullenweg who rises up from today’s generation of students, hundreds of thousands of future entrepreneurs, scientists, and leaders are not able to overcome their conditioning of dependency and doubt. My fear is that we are creating a nation of “nontrepreneurs,” and that because of our eroding entrepreneurial spirit we are losing future contributors to not only the U.S., but to the world.
So – Americans, world citizens – what should we do about this?
UPDATE: Mike Lanza pointed me to his post on this topic, "We’re Raising a Generation of Organization Men (or Women)" and The Atlantic Monthly's David Brook's article, "The Organization Kid," from April 2001.
A indirectly related issue is discussed by George Will, "A Nation Held Back By (Lack of) Education"
education, innovation, entrepreneurship, parenting, startups, mark zuckerberg, matt mullenweg
Monday, February 11, 2008
Our Nation's Innovation Dilemma
I came across John Kao's new blog, "Innovation Nation," at The Huffington Post.
His first post, The Innovation "Frame", is a good start to what I believe is an important topic and discussion to push into the national spotlight. An excerpt:
We've had the Iraq "frame," and now the recession and change "frames." But what about the Innovation "frame?" Are we just not getting the importance of innovation? Vannevar Bush, presidential science advisor, said it best in 1947, "A nation that loses its science and technology will lose control of its destiny." More recently the National Academy of Science referred to the problem as a "gathering storm." And in my own recent book, Innovation Nation, I state that America is losing its innovation edge with profound implications for our security and prosperity as a nation.
Is anybody listening out there in leader-land?
History will show America's current innovation melt-down to have been an egregious self-inflicted wound. I would need ten times this space just to recite a list of dismal facts about how poorly our national innovation system is performing. Some headlines: our young scientists are abandoning their careers with increasing frequency, talent is increasingly not coming to our storied shores, our public education and R & D are showing significant erosion, we're strapped for cash, other countries are leading us in a growing number of scientific fields, and nobody seems to care.
I blogged about a related topic back in 2003 ("It's Not The Deficit Stupid!... Tech is the Primary Driver of Economic Growth"). An excerpt:
Nelson and others within the same camp believe technical advance or growth in technology account for 50%-70%+ of long-term economic growth. Seeing how the U.S. has become the world's foremost economic power, it's difficult to deny some of the truth and theories developed from Nelson and others. Whole new industries were created by developments that sprouted from U.S. R&D labs throughout the 20th century. From Xerox's fabled Palo Alto Research Center (PARC) to AT&T's Bell Labs to DARPA, inventions such as laser printing (1971), Ethernet, the graphical user interface, the Internet (1969), and cellular communications (1947) were given birth to in these halls.
One of the people most responsible was Vannevar Bush, Director of the Office of Scientific Research and Development under FDR. His report to President Roosevelt, "Science The Endless Frontier" (July 1945), help set forth and secure U.S. investment into scientific research as one of its core policies. Heavy investment by the government into various military and non-military labs were initiated.
One danger that is recently occurring is the decrease in funding for basic research. Basic research allows scientists to research for the sake of researching. To seek out their curiosities and find the truths of the universe. This is more of a non-linear approach that allows for a wide-range of possibilities, and many inventions that have changed our lives have come from basic research (e.g. x-rays, superconductivity, laser... what would you do without CDs or DVDs?). Over the past decade, corporations under pressure to perform have cut back or closed down their basic research efforts and only focused on applied research that seeks out a specific solution or product that can eventually generate revenue for the company.
I haven't read John Mao's book ("Innovation Nation") yet, but I assume it includes my concerns and others that I haven't blogged about. For me, there are three primary areas of concern with our nation's innovation engine:
1. Decreases in overall scientific research dollars, especially in basic research.
2. Changes in the education system that are degrading our culture of innovation, entrepreneurship and creativity (future blog post).
3. Continued blockade and movement of immigrants into the U.S. fabric hence depleting our innovation engine of a primary "fuel" source (increase H-1Bs!).
While I believe research dollars are the primary driver, our nation's culture of innovation and entrepreneurship is still unique and unmatched so we need to continue to lead in all these areas through sound public policy, investment and education. The next president has to take a strong lead on this and change the course of our rapidly weakening strongholds, or our nation's ideals, economy and future generations will suffer.
His first post, The Innovation "Frame", is a good start to what I believe is an important topic and discussion to push into the national spotlight. An excerpt:
We've had the Iraq "frame," and now the recession and change "frames." But what about the Innovation "frame?" Are we just not getting the importance of innovation? Vannevar Bush, presidential science advisor, said it best in 1947, "A nation that loses its science and technology will lose control of its destiny." More recently the National Academy of Science referred to the problem as a "gathering storm." And in my own recent book, Innovation Nation, I state that America is losing its innovation edge with profound implications for our security and prosperity as a nation.
Is anybody listening out there in leader-land?
History will show America's current innovation melt-down to have been an egregious self-inflicted wound. I would need ten times this space just to recite a list of dismal facts about how poorly our national innovation system is performing. Some headlines: our young scientists are abandoning their careers with increasing frequency, talent is increasingly not coming to our storied shores, our public education and R & D are showing significant erosion, we're strapped for cash, other countries are leading us in a growing number of scientific fields, and nobody seems to care.
I blogged about a related topic back in 2003 ("It's Not The Deficit Stupid!... Tech is the Primary Driver of Economic Growth"). An excerpt:
Nelson and others within the same camp believe technical advance or growth in technology account for 50%-70%+ of long-term economic growth. Seeing how the U.S. has become the world's foremost economic power, it's difficult to deny some of the truth and theories developed from Nelson and others. Whole new industries were created by developments that sprouted from U.S. R&D labs throughout the 20th century. From Xerox's fabled Palo Alto Research Center (PARC) to AT&T's Bell Labs to DARPA, inventions such as laser printing (1971), Ethernet, the graphical user interface, the Internet (1969), and cellular communications (1947) were given birth to in these halls.
One of the people most responsible was Vannevar Bush, Director of the Office of Scientific Research and Development under FDR. His report to President Roosevelt, "Science The Endless Frontier" (July 1945), help set forth and secure U.S. investment into scientific research as one of its core policies. Heavy investment by the government into various military and non-military labs were initiated.
One danger that is recently occurring is the decrease in funding for basic research. Basic research allows scientists to research for the sake of researching. To seek out their curiosities and find the truths of the universe. This is more of a non-linear approach that allows for a wide-range of possibilities, and many inventions that have changed our lives have come from basic research (e.g. x-rays, superconductivity, laser... what would you do without CDs or DVDs?). Over the past decade, corporations under pressure to perform have cut back or closed down their basic research efforts and only focused on applied research that seeks out a specific solution or product that can eventually generate revenue for the company.
I haven't read John Mao's book ("Innovation Nation") yet, but I assume it includes my concerns and others that I haven't blogged about. For me, there are three primary areas of concern with our nation's innovation engine:
1. Decreases in overall scientific research dollars, especially in basic research.
2. Changes in the education system that are degrading our culture of innovation, entrepreneurship and creativity (future blog post).
3. Continued blockade and movement of immigrants into the U.S. fabric hence depleting our innovation engine of a primary "fuel" source (increase H-1Bs!).
While I believe research dollars are the primary driver, our nation's culture of innovation and entrepreneurship is still unique and unmatched so we need to continue to lead in all these areas through sound public policy, investment and education. The next president has to take a strong lead on this and change the course of our rapidly weakening strongholds, or our nation's ideals, economy and future generations will suffer.
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