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innovation DAILY

Here we highlight selected innovation related articles from around the world on a daily basis.  These articles related to innovation and funding for innovative companies, and best practices for innovation based economic development.

Money

Over the years, I’ve had the privilege of working with some of the best entrepreneurs in Silicon Valley and elsewhere. On the average, the entrepreneurs I know are struggling. But one thing they all seem to have in common is a love for learning and change. They rush in with a passion to better the world, and money is just an indication of their progress.

The successful ones then invest their time and money in furthering their knowledge base. I’m not talking about academic classes, because at best these only teach you how to learn. In these days of rapid change, most experts believe that the facts college students learn as a sophomore are obsolete before they exit their senior year.

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lightbulb

In the report, entitled 'Innovation: How Europe can take off', a series of academics give their opinions on Europe's approach to innovation policy and how it can be improved.

The report's authors all broadly agree that innovation is not the same as research and development.  Increasingly, it has also become a democratic process with consumers which is likely to contribute ideas as much as entrepreneurs and scientists.

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NewImage

In a landmark government effort to drive American health care into the information age, the February 2009 stimulus bill earmarked about $30 billion in incentives for doctors and hospitals who install electronic medical records—paying up to $63,750 to individual physicians and millions to hospitals.

Now comes the tough part: implementing "EMRs" and proving they really can reduce medical errors or get doctors to keep better track of chronically ill people. As National Coordinator for Health IT, Farzad Mostashari oversees federal efforts to promote adoption of EMRs and to prod reluctant hospitals to share patient data.

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Ask the VC Logo

The short answer is yes, you have to be a corporation to raise VC funding

VCs will want you to be a C-Corp for a few specific reasons. The main advantage of an LLC over a C-Corp is that the taxes are not flow through.  In other words, your company’s tax situation will not hit the bottom line of the VC.  As VCs are generally structured to be flow through tax entities, if your company was a LLC, your tax situation would flow through the VC and directly to their investors.  This is not a good place to be and VC investors demand that we only invest in C-corps to stop this problem.

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Richard Branson

MONTEGO BAY, Jamaica, September 8, 2011 -- /PRNewswire/ --

A new facility committed to growing entrepreneurship in the Caribbean region welcomed its first intake of 14 young entrepreneurs today.

The Centre is operated by Virgin Unite, the non-profit foundation of the Virgin Group, and Virgin Holidays, the UK's number one long haul holiday company. It will provide aspiring entrepreneurs with a launch pad for their businesses and a platform for job creation across the Caribbean.

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storm

The economic storm clouds are darkening and the Canadian dollar's continued strength isn't helping matters.

Even so, the outlook for Quebec's small-and mediumsized enterprises (SMEs) remains good, says Marie-Claude Boisvert, chief operating officer at Desjardins Venture Capital, which manages $1.3 billion in assets, mostly in Quebec companies.

"We have a lot of small-and medium-sized companies in the regions of Quebec and they are a little bit less affected by the slowdown." Their revenue base is regional rather than dependent on exports to the United States, where the economy looks increasingly shaky.

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Burning Money

As part of our Getting Funded series, we asked members of the Young Entrepreneurs Council what the worst VC meeting they had was and what they learned from it. From angry dinners to annoying yawns, here are their answers.

1. There's Nothing Better Than Your Product Breaking In The Boardroom!

It's inevitable that your product will break or crash five minutes before you talk to a VC. I swear they have apps that ensure it just to test you. The key is to understand your idea and story, bring a short deck of slides, and quickly outline who you are and why you're interesting. Be humble, admit mistakes or weaknesses openly, and ask for feedback. If you do, the meetings will work out fine.

- Derek Shanahan, Foodtree

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Clock

Interestingly Gates, Buffet, Jackson, Jordan and You have the same amount of hours in a day, but some are able to accomplish far more than the rest. There is literally an art and science to managing yourself to produce more in the same time allotted to every one of us.

I once heard Eben Pagan say something along the lines of this:

“The term time-management is a misnomer, we need to manage ourselves, not time”.

And I cannot agree more.

Below I will show you five practical concepts that I personally use to become more productive as an entrepreneur.

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Office Space

The emerging “sharing economy” consists of businesses dedicated to changing the very way in which we live. Tools to improve efficiency, lower cost, and encourage collaborative consumption now serve as the driving force of these companies, creating a whole new kind of economy.

Arguably, the most significant progress thus far has been made in the workplace.

The work environment is undergoing significant change. We used to be a nation of office workers. We committed our lives to single companies, and went to work in the same location every day.

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patent

President Obama is expected, without delay, to sign into law the first large-scale reform to U.S. patent laws in 60 years. It brings U.S. law into line with most international practices, and is designed to quash patent trolling, cut red tape, and spur innovation.

Late last night the Senate voted 89-9 to pass the America Invents Act that would radically reshape patent laws, and President Obama is expected to sign it without delay. It's the first such significant bill in 60 years, and it has one key component: It moves the onus from merely "inventing" a patentable idea first to becoming the person who actually files for an innovation first.

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Robert Nelsen

American innovation lost big again as the U.S. Senate passed “patent reform” and caved to big business lobbyists at the expense of true innovators in small companies and universities. Bottom line: America has dominated innovation in the world for 100 years based on our patent system and protection of risk-takers. Innovation is the one thing we still dominate in the world economy. It is our job engine. The first rule of governing should apply here: If it aint broke don’t “fix” it.

The sponsors, Senator Patrick Leahy of Vermont and Representative Lamar Smith of Texas, worked extremely hard and were well-meaning, but the big lobbyists hijacked the process. The bill was conceived to solve the problem of truly frivolous lawsuits in the technology and banking industries. That problem was solved in five minutes, and then the big companies got ahold of the Bill and added all their bells and whistles and it passed based on sheer inertia. Few in Congress like this law, but they went along because big companies have more power than true innovators. Many will cheer it just to suck up to their representatives. Not me. Few, like Senator Maria Cantwell of Washington state, had the courage to call the bill what it is and that it “tramples the rights of small inventors.”

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Christopher Noble, MIT Technology Licensing Officer

“How much money should I raise?” asks the new entrepreneur to anyone who will listen. The answers, unfortunately, are all over the map: “Nothing! Bootstrap”; “As much as you can”; “Ask the investor”; “Enough for the first six months/one year/two years”; “Plan at least two rounds ahead”… Being an entrepreneur is tough!

I raised Angel and VC money for two startups of my own, and for four others as a consultant. Now I license MIT’s energy IP to startups, and we make sure they are adequately capitalized before we issue the license. Here are some suggestions on how to approach the “how much should I raise” question. Of course, I am assuming that you have already convinced the investor that you have (a) the team, (b) the opportunity and (c) the advantage that they are looking for. Focus on those three first!

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Ugg

Even when your startup is a one-man show, you will soon find that you are “out of control,” unless you start organizing and writing down how and when key things need to get done. Like it or not, you are now entering the dreaded realm of “formal business processes.” The right question is “What is the minimum that I need?”

The simple answer is that you need to implement one process at a time, starting with those things that are most critical to your business, until you feel a relief that things are starting to happen naturally and consistently, without the attendant stress and continual recovery mode. If you feel that the process itself is a burden, you have likely gone too far.

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Chart

Some prominent venture capitalists are betting that the Internet strategies that created giants such as eBay and PayPal could reshape the ailing U.S. health-care system. That system currently devours 18 percent of the world's largest GDP while delivering mediocre health results.

In August, the online health marketplace ZocDoc, which lets patients look up doctors by specialty and zip code and make appointments over the Internet, raised $50 million from the investment fund of Russian billionaire Yuri Milner, who in the past has backed companies like Facebook, Twitter, and Groupon.

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NewImage

Universities across Europe are under pressure to use their knowledge and discoveries to drive economic growth, but a UK study has shown their ability to do this depends on the local economy. In the UK, universities in the greater south-east of England seem to be better than those in less competitive regions at commercialising their research and innovation.

The study, led by Robert Huggins at the University of Wales Institute Cardiff, made a regional comparison of how knowledge flows out of universities and into the business community, both in the local area and beyond the region where particular universities are based.

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Nadia Mykytczuk, a microbiologist, has benefitted from a program that helps doctoral students in Canada acquire professional skills. As part of the program she has conducted research in the Arctic.

For young doctoral students in Canada, acquiring professional skills is increasingly essential. The supply of postgraduates outstrips the demand for full-time academics, and many students find themselves eyeing alternative careers in industry, government, or the not-for-profit sector. New training programs have sprung up in the past few years, with more on the way, designed to give them professional skills, such as communication, leadership, and intellectual-property management, for careers in industry, government, or academe.

"We see that the majority of our university graduates don't have an academic career, so we are sending the message to think about the future career of your trainees," says Isabelle Blain, vice president of research grants and scholarships at the Natural Sciences and Engineering Council of Canada.

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Wind Turbines

The UK faces a lost decade of stagnation unless the Government works with business and finance to move the country away from an “economic corner”, a new report has warned.

The report by the Work Foundation and Lancaster University calls for investment in areas of the economy likely to bring the greatest dividends in growth and jobs.

Ministers are pressed to work alongside business and finance to take advantage of the “enormous” opportunities provided by emerging technologies in health science, digital and low carbon.

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NewImage

Here is a great blog posting by Steven Blank -- "Why governments don't get startups". He makes a point that I heartily agree with (and have been trying to articulate) -- there are different types of start-ups and that government policy needs to understand which type it is seeking to foster. Too often from what I've seen, policy tries to be all things to all entrepreneurs. But different forms of entrepreneurship have different impacts on the overall economy -- and have different needs. Our policies tend to confuse "small business" with "entrepreneurship" with "growth businesses." Blank's typology is one way of cutting through the confusion:

Six Types of Startups - Pick One

There are six distinct organizational paths for entrepreneurs: lifestyle business, small business, scalable startup, buyable startup, large company, and social entrepreneur. All of the individuals who start these organizations are "entrepreneurs," yet not understanding their differences screws up public policy because the ecosystem in supporting each type is radically different.

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Creative Destruction

Schumpeter claimed the entrepreneur to be instrumental for creative destruction and industrial dynamics. Entrepreneurial entry serves to transform and revitalize industries, thereby enhancing their competiveness. This paper investigates if entry of new firms influences productivity amongst incumbent firms, and the extent to which altered productivity can be attributed sector and time specific effects. Implementing a unique dataset we estimate a firm-level production function in which the productivity of incumbent firms is modeled as a function of firm attributes and regional entrepreneurship activity. The analysis finds support for positive productivity effects of entrepreneurship on incumbent firms, albeit the effect varies over time, what we refer to as a delayed entry effect. An immediate negative influence on productivity is followed by a positive effect several years after the initial entry. Moreover, the productivity of incumbent firms in services sectors appears to be more responsive to regional entrepreneurship, as compared to the productivity of manufacturing firms.

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