Promoting Innovation and Entrepreneurship

Stephen DeAngelis

December 21, 2009

Michael Arndt, editor of BusinessWeek‘s innovation and design coverage, reminds us that “innovation requires taking risks, and these are risk-averse times.” The good news, however, is that tough times haven’t stopped innovative companies and entrepreneurs from pursuing their dreams. The event that motivated Arndt’s comment was the October announcement of the 2009 Chicago Innovation Awards organized by Kuczmarski & Associates, a Chicago innovation consultancy firm. The ten winners of the 2009 Chicago Innovation Awards were:

Aircell for Gogo Inflight Internet Service—Bringing Internet service to passengers on commercial airline flights.

comScore, Inc. for ComScore Ad Effx Suite—Showing the value of online advertising by quantifying an online campaign’s impact on sales.

Groupon, for collective buying power—Bringing a new approach to group buying strategies on the Internet.

EveryBlock, for local news feeds—Keeping people informed about the news right down to the block on which they live.

Rescue Vac Systems, Inc. for the Rescue Vac 800 Series Rescue Kit—Giving rescue workers a swift system for saving people involved in trench collapse

Suncast Corporation, for the No Crank Water Powered Hose Reel—Providing homeowners a swift water-powered system for reeling up a garden

The Art Institute of Chicago, for its new Modern Wing—Offering museum visitors a one-of-a-kind space for the viewing of modern art.

The Robotic Surgery Program of the University of Illinois at Chicago—Expanding the ways in which robotic surgery is brought to bear in precise surgery with more rapid recovery.

Tripp Lite, for its ECO Series Uninterruptable Power Supply System—Reducing the environmental impact of a home’s electrical system.

Visible Vote—Providing citizens expanded access to their elected officials.

Award organizers presented two other awards as well. The inaugural “People’s Choice” award went to Abbott Laboratories for its “mom-friendly” design of its Similac® SimplePac™ infant formula packaging. A special “Visionary” award went to Michael Wielgat, a Chicago Fire Department lieutenant, who spent $100,000 of his own money to build “a portable device that can redirect water directly into a flaming structure from the floor below” when fighting blazes in highrise structures [“‘Hero Pipe’ Wins Chicago Innovation Award,” by Michael Arndt, BusinessWeek, 19 October 2009]. As the name implies, the Chicago Innovation Awards go to businesses and individuals in the Chicago area. I suspect that each major urban area could generate a similar list of innovative enterprises in its area. In fact, a recent BusinessWeek article focuses on the fact that “urban science parks are being built to lure the best minds and the industries of tomorrow” [“Innovation Goes Downtown,” by Pete Engardio, 19 November 2009]. Engardio writes:

“Say ‘science park’ to most Americans and they probably will think of beautifully landscaped campuses of low-rise buildings on the outskirts of a city, where researchers commute to their cubicles each morning and fight the evening traffic to return home. For 50 years the prototype was Research Triangle Park—an 11-sq.-mile district snuggled into the piney hills outside of Durham, N.C., with such multinational tenants as IBM and GlaxoSmithKline. No longer. Today’s high-tech meccas are being constructed deep inside major cities. Michael Joroff, an urban-planning guru at Massachusetts Institute of Technology, dubs them ‘new century cities.’ Their goal, says Joroff, an adviser to projects in South Korea, Britain, Sweden, and Abu Dhabi, is to ‘kick-start high-priority industries with new spaces where companies and universities can work together and develop the next generation of workers.’ Planners also hope to tap into the ‘new urbanism’ movement by offering plenty of amenities where scientists, entrepreneurs, and creative types from an array of industries can intermingle and, with a bit of serendipity, cross-pollinate ventures.”

Engardio covers a lot of ground in those few words — everything from developing the next generation of workers to multi-disciplinary cooperation. With many urban areas in the U.S. hurting badly as a result of the current recession, municipal leaders should closely examine what is being done in places like Barcelona and Seoul. Engardio continues:

“The scale of some of these urban schemes is jaw-dropping. Spain’s 22@Barcelona (the name comes from an industrial zoning designation) involves transforming 115 blocks of the city to house more than 1,000 international media, IT, and medical technology companies that are expected to employ 150,000 in 15 years. Singapore is spending some $10 billion on futurist architecture for a megadevelopment called One North, which integrates new research and development complexes and ‘living laboratories’ for biotech, advanced materials, and medical services. Seoul hopes Digital Media City, which is rising near an old railroad depot and dump, will have 120,000 workers and 2,000 companies by 2015.”

In an earlier post, I discussed an R&D city being built in the UAE (see Abu Dhabi’s Masdar Plan). Of course, there are big bucks behind these projects and that is something that America’s impoverished urban centers have little of. Engardio points out, however, that not all plans have to be as lavish as those discussed above. He continues:

“Some older U.S. tech clusters are trying to adapt. Industrial parks set up in the 1960s outside San Jose to cater to the then-nascent electronics industry are adding amenities including housing, shops, and bike and hiking trails to turn them into fuller communities. Research Triangle Park is dolling itself up, too. ‘This is about making this place consistently more attractive to the brightest minds in the world,’ says Rick L. Weddle, CEO of the Research Triangle Foundation, which owns the park. Midsize industrial cities see downtown parks as redevelopment tools. Winston-Salem, N.C., hit hard by the decline of the tobacco, textile, and furniture industries, has converted a building once owned by R.J. Reynolds into the headquarters of a research park specializing in biomedicine. Meantime, Sheffield, England, a cradle of the Industrial Revolution, is launching an ambitious redevelopment to position itself as a hub for advanced manufacturing, design, and new media.”

Not all science parks are created equal. I was going to write: “as the old saying goes, ‘you can put lipstick on a pig, but it’s still a pig.'” But a little research indicates that it’s not such an old saying — it can be traced back to 1985. The oldest similar expression — “You can’t make a silk purse from a sow’s ear” — dates back at least to the mid-16th century. Both adages adequately express the notion, however, that, unlike the field of dreams, if you build a science park people won’t necessarily be attracted to it. Like all real estate, what matters is location, location, location. For every new science park that succeeds, one or more may fail. Engardio continues:

“Skeptics warn the trend is getting overdone and that some science parks will flop. ‘Every city and state with a university wants to jump on this bandwagon,’ says Peter B. Calkins, who heads the science and technology business of Cleveland-based developer Forest City Enterprises. ‘Not all are well-conceived.’ Forest City built and manages University Park in Cambridge, Mass., which is filled with biotechnology companies, and is building a major complex near Johns Hopkins University in Baltimore. The payback for such projects can be long, Calkins notes. Despite its proximity to Massachusetts Institute of Technology, University Park needed more than a decade to gain traction with corporate tenants. Many new parks going up in China, the Persian Gulf, and parts of the U.S. are ‘just big real estate developments, rather than investments in people and innovation,’ says Anthony Townsend, who tracks science parks for the Institute for the Future, a think tank based in Palo Alto, Calif. Often, he says, inventors just need cheap space in a stimulating environment.”

Creative people like being around other creative people and when smart people from one discipline get together with smart people from another discipline great things generally happen. That is probably the best argument for clusters. But clusters need not be big to be effective. Universities have effectively established campus clusters that have inspired great ideas and entrepreneurial enterprises, even if they are not located in large metropolitan areas [“Brigham Young’s Entrepreneur Factory,” by Vanessa Wong, BusinessWeek, 4 December 2009]. Wong writes:

“In an effort to attract dollars, prestige, and top-notch staff, universities have long pushed to commercialize faculty research. That has helped institutions from Massachusetts Institute of Technology to Stanford become hotbeds of entrepreneurialism. The most surprising success, though, may be Brigham Young University. The Provo (Utah) university now ranks first in the country in the number of startups, licenses, and patent applications per research dollar spent, according to the Association of University Technology Managers. BYU-licensed technology led to the creation of nine new companies last year on a research budget of roughly $30 million. Stanford, with a budget of $1.1 billion, spawned the same number of startups.”

To beef up its technology transfer department, BYU hired Mike Alder, an Alabama venture capitalist, and Dee Anderson, a lifelong entrepreneur. They set about creating the kind of campus cluster I discussed above.

“Alder and Anderson have put much of their energy into building better relationships. They hold weekly meetings with different departments to discuss research in core areas such as chemistry, computer science, and engineering. In September, Anderson set up a LinkedIn group of BYU grads who want to hear about new technologies. That has resulted in several phone calls a week from people interested in using BYU research. The school also started an Entrepreneur in Residence program earlier this year that recruits alumni and business leaders to help evaluate technologies and identify opportunities for startups. It has so far recruited 28 entrepreneurs. While all are unpaid, they can invest in the business ventures they help put together. One entrepreneur is Eliot Jacobsen, a partner at a venture fund called RocketFuel in Salt Lake City. He plans to license an e-mail encryption technology that he discovered through the program. … What distinguishes BYU, says Diane L. Palmintera, president of Innovation Associates, a consultancy in Reston, Va., is that it’s adopting an approach used by institutions with a much greater focus on research.”

The thread that weaves its way through each of these articles is that the future belongs to those with innovative ideas and an entrepreneurial spirit. Even in dark times, the light of creativity manages to shine bright enough to light the way ahead. Over the next couple of days, I’ll have a bit more to write about innovation. It’s a good topic to help usher in the new year.