A U T H O R O F W H Y G M M A T T E R S

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WILL IAM J . HOLSTEIN

T H E

N E X T A M E R I C A N E C O N O M Y

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How American Cities, States, and Regions Create Technology Clusters

Presentation for theColorado Innovation Network Summit

August 29, 2013

Follow along at slideshare.netSearch: Bill Holstein COIN Summit

OCT. 19,1992

WHAT IS A CLUSTER?

WHAT IS A CLUSTER?

By “cluster,” we mean a successful example of technology-based growth such as:

‣ San Diego’s genomics and wireless industries

‣ Silicon Valley’s I.T.-related industries

‣ Dallas area’s telecommunications hub

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WHAT IS AN IDEA FACTORY?

WHAT IS AN IDEA FACTORY?

It can be a university, research institute, large hospital, national weapons laboratory or a large private sector company.

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WHAT IS AN IDEA FACTORY?

It is characterized by:‣ Sustained Interactions‣ Both Formal and Informal

Between:‣ Different disciplines‣ Different cultures, nationalities

With A Mix of Basic and Applied Research

Mostly Funded by Government and Corporations

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HOW DO IDEAS LEAVE THE FACTORY?

HOW DO IDEAS LEAVE THE FACTORY?

The key is the technology licensing and patenting office.

‣ Under what terms does the office allow development of a technology?

‣ Does it facilitate robust exchange of ideas between "inside" and "outside?"

‣ What resources does it possess?

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5 STAGES OF THE COMMERCIALIZATION ECOSYSTEM

STAGE 1

START UP

UNIVERSITYSETTING

FINANCING

TEAMSCIENTISTS & RESEARCHERS ONLY

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GOV’TLARGE CO’S

STAGE 1 STAGE 2

START UP DEVELOPMENT

UNIVERSITY INCUBATOR/ HALFWAY

HOUSE

SETTING

FINANCING

TEAMSCIENTISTS & RESEARCHERS ONLY

TEAM GROWS: - MARKETING- FINANCE

OTHER KEY INPUTS:- MENTORING- PEER NETWORKING- SKILLED LABOR- NETWORKING MECHANISMS

WilliamJHolstein.com

GOV’TLARGE CO’S

SBAANGELS

FOUNDATIONS

INCUBATORS

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INCUBATORS

There are more than 1,000 incubators in the U.S. Why are they not more effective?

‣ Funding is short-term and dependent on governors, mayors, and chambers of commerce.

‣ Income streams from rentals to start-ups is so important they do not encourage the companies to leave.

‣ They do not establish themselves at the heart of a technology cluster.

WilliamJHolstein.com

STAGE 1 STAGE 2 STAGE 3

START UP DEVELOPMENT MARKET FACING

UNIVERSITY INCUBATOR / HALFWAY

HOUSE

OFFICESETTING

FINANCING

TEAMSCIENTISTS & RESEARCHERS ONLY

TEAM GROWS: - MARKETING- FINANCE

PROFESSIONAL CEO MAY BE REQUIRED

OTHER KEY INPUTS:- MENTORING- PEER NETWORKING- SKILLED LABOR- NETWORKING MECHANISMS

WilliamJHolstein.com

GOV’TLARGE CO’S

SBA

VC FUNDING

ANGELSFOUNDATIONS

STAGE 1 STAGE 2 STAGE 3 STAGE 4

START UP DEVELOPMENT MARKET FACING

VALLEY OF DEATH

UNIVERSITY INCUBATOR / HALFWAY

HOUSE

OFFICESETTING

FINANCING

TEAMSCIENTISTS & RESEARCHERS ONLY

TEAM GROWS: - MARKETING- FINANCE

PROFESSIONAL CEO MAY BE REQUIRED

CEO + FULL FINANCIAL TEAM- MANUF.- LOGISTICS- SALES

OTHER KEY INPUTS:- MENTORING- INCUBATORS- PEER NETWORKING- NETWORKING MECHANISMS

WilliamJHolstein.com

GOV’TLARGE CO’S

SBA

VC FUNDING

ANGELSFOUNDATIONS

STAGE 1 STAGE 2 STAGE 3 STAGE 4 STAGE 5

START UP DEVELOPMENT MARKET FACING

VALLEY OF DEATH

FULLY COMMERCIALIZED

UNIVERSITY INCUBATOR/ HALFWAY

HOUSE

OFFICESETTING

FINANCINGGOV’T

LARGE CO’SSBA

VC FUNDINGTEAMSCIENTISTS & RESEARCHERS ONLY

TEAM GROWS: - MARKETING- FINANCE

PROFESSIONAL CEO MAY BE REQUIRED

CEO + FULL FINANCIAL TEAM- MANUF.- LOGISTICS- SALES

OTHER KEY INPUTS:- MENTORING- INCUBATORS- PEER NETWORKING- NETWORKING MECHANISMS

WilliamJHolstein.com

ANGELSFOUNDATIONS

STAGE 1 STAGE 2 STAGE 3 STAGE 4 STAGE 5

START UP DEVELOPMENT MARKET FACING

VALLEY OF DEATH

FULLY COMMERCIALIZED

UNIVERSITY INCUBATOR/ HALFWAY

HOUSE

OFFICESETTING

FINANCINGGOV’T

LARGE CO’SSBA

VC FUNDINGTEAMSCIENTISTS & RESEARCHERS ONLY

TEAM GROWS: - MARKETING- FINANCE

PROFESSIONAL CEO MAY BE REQUIRED

CEO + FULL FINANCIAL TEAM- MANUF.- LOGISTICS- SALES

OTHER KEY INPUTS:- MENTORING- INCUBATORS- PEER NETWORKING- NETWORKING MECHANISMS

WilliamJHolstein.com

ANGELSFOUNDATIONS

WHERE ARE THE GAPS???

‣ Absence of venture capital for early stage companies.

‣ Mechanisms for introducing Ph.D. would-be entrepreneurs to MBA-trained corporate executives.

MOST COMMON GAPS

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‣ Shortages of skilled & technical labor that make it harder to achieve scale.

STAGE 1 STAGE 2 STAGE 3 STAGE 4 STAGE 5

START UP DEVELOPMENT MARKET FACING

VALLEY OF DEATH

FULLY COMMERCIALIZED

UNIVERSITY INCUBATOR/ HALFWAY

HOUSE

OFFICESETTING

FINANCINGGOV’T

LARGE CO’SSBA

VC FUNDINGTEAMSCIENTISTS & RESEARCHERS ONLY

TEAM GROWS: - MARKETING- FINANCE

PROFESSIONAL CEO MAY BE REQUIRED

CEO + FULL FINANCIAL TEAM- MANUF.- LOGISTICS- SALES

OTHER KEY INPUTS:- MENTORING- INCUBATORS- PEER NETWORKING- NETWORKING MECHANISMS

WilliamJHolstein.com

ANGELSFOUNDATIONSWHERE ARE THE

OVERLAPS???

MOST COMMON OVERLAPS

If a state or region has too many competing institutions…and too much institutional rigidity…the result is confusion for end-users.

Resources are not properly focused…no one program achieves scale.

WilliamJHolstein.com

MOST COMMON OVERLAPS

KEY QUESTIONS:

‣ Do government agencies, political leaders, universities, institutes, innovation centers and the private sector have broad agreement on a strategic direction?

‣ …and who does what?

WilliamJHolstein.com

http://www.medicine.usask.ca/family/

TRAINING / RETRAINING ECOSYSTEM

Workers pay to take appropriate classes

Support from:- Fed / State / Local- Foundations- Student Loans

Companies require specific skills, advise community colleges on courses, provide equipment and instructors

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COMMUNITY/TECHNICAL COLLEGE SYSTEM

Output

Well-trained workers for jobs that exist today and in the future

DOES EDUCATION FEED THE CLUSTER?

DOES EDUCATION FEED THE CLUSTER?

‣ Are community & technical colleges aligned with their region’s technology-based clusters?‣ Are they

anticipating their needs in 5-10 years?

WilliamJHolstein.com

Good fortunes for your

region lie ahead

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A U T H O R O F W H Y G M M A T T E R S

BLUEPRINT FOR A REAL RECOVERY

WILL IAM J . HOLSTEIN

T H E

N E X T A M E R I C A N E C O N O M Y

Available in print and e-reader formats today.

WilliamJHolstein.com