A Discussion on French Entrepreneurship with John Chambers

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I recently had the unique opportunity to join selected MIT faculty, students, and staff to discuss the current business climate with John Chambers, the Executive Chairman of the Board and former CEO of Cisco Systems. He was the guest of honor at a recent MIT Leadership Center luncheon and it was pure luck that I ended up sitting next to him as our meal was served.

My question to John was: what he thinks we should be doing to educate entrepreneurs today (that is currently lacking). Although he didn’t answer that question directly, he did talk about the differences in East Coast and West Coast philosophies. The West vs. East innovation discussion is always a good one (see my blog on Massachusetts being ranked the most innovative state in America) and it was clear that John felt that in Silicon Valley, it is more important to be a founder/key engineer than is to be the CEO of a Fortune 100 company.

Paris conferenceWe then started discussing innovation in other countries, particularly France, in light of my upcoming keynote speech in Paris at the symposium on Entrepreneurial Research: Past, Present and Future. John remarked that the French entrepreneurial ecosystem is actually as large as Boston’s. I was a bit surprised, but also intrigued as I’ve been researching how the French approach entrepreneurship to prepare for my presentation.

Here are some of the highlights of my research I thought I’d share:

  • The French business environment has undergone radical change in recent years. Investment activity in French startups has been on a steady rise. Moreover, it is coming from all sides of French society – the government, the corporations, and the new wave of entrepreneurs. In addition, France has over 100 venture capitalists who invested more than $2 billion in 2016.
  • This activity has changed the general attitude among the younger generation towards entrepreneurship. Up until 2012, France’s best talent was driven to big firms. However, now more than 50% of young people between the ages of 18 and 24 want to start a business, and 1 in 3 of France’s 70,000 Ph.D. students also want to create their own business. At this moment, France has more than 50 startup accelerators, and more than 100 co-working spaces have opened their doors recently.
  • President Hollande’s socialist government has made fostering startups an economic priority with a cohesive policy that has included:
    • Tax incentives for new businesses
    • Government and public sector funding
    • Creation of Special Tech Programs on national and regional levels
    • New crowd-funding legislation
  • The weak point of French VCs is lack of sufficient capital for later-stage funding rounds, forcing many promising French startups to look abroad for their financing needs or get acquired by global multinationals.
  • According to French government, more than 550,000 startups are created each year. More than $2 billion was invested in French startups in 2016. Three startups raised more than $100M:
    • Sigfox (IoT ecosystem)
    • Deezer (Music streaming)
    • Devialet (Sound technology)
  • According to European Digital City Index (EDCI), Paris is the 5th best city for startups in Europe. According to the Compass 2015 Global Startup Ecosystem Ranking, Paris is the 11th best ecosystem for startups globally.
  • Brexit creates excellent opportunity for France to lure best tech startups from UK and transform itself into the #1 European and one of the leading global startup hubs.
  • The presidential elections that will be held in April and May 2017 should be carefully watched. The possible win of Mr. Macron could be a big boost for the French entrepreneurial ecosystem since his tenure as a Minister of Economy was huge boon for the French startup ecosystem.

As Americans we tend to critique French capitalism due to issues such as a high level of government intervention, inflexible labor laws, a fear of failure among entrepreneurs, and the lack of innovation.  However, all this is changing.

I look forward to my visit to Paris in the springtime and will share what I learn at the symposium.

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Chasing Unicorns or Planting Trees?

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unicorn12967178What does Entrepreneurial Success Look Like?  

In the business world, privately held companies valued at $1 billion or more are known as unicorns. Like unicorns, the billion-dollar startup was once only a myth. Now, all that has changed.

Fortune now publishes “The Unicorn List” that includes 174 unicorns. Uber tops the list, with Airbnb, Snapchat, and Pinterest also in the top 10. The Wall Street Journal also publishes a dynamic “Billion Dollar Startup Club” graphic that shows unicorns with their current value and region of origin – Uber’s current $68 billion valuation is by far the highest of the group.

Some rankings use just one criterion, such as venture capital funding to measure success. Although not necessarily the best measurement, it is an easy, publicly available figure, and there have certainly been unicorns that have failed. But, should valuation or the ability to raise money be the only measure of success?

What about the important success factors such as profitability, revenue, job creation, and even intangibles such as social good – giving back to the community or the world. The combination of these metrics provide a more holistic view to measure success.

MIT has been measuring entrepreneurial success for years, and our figures take into account job creation and revenues. According to our last update, companies founded by living MIT alumni have created 4.6 million jobs and generated nearly $2 trillion in annual revenues – that’s about the same as the GDP of the world’s 10th largest economy.

While the trajectory of the unicorns is impressive, a great number of unicorns aren’t profitable. Many startups and entrepreneurs have focused on “growth at all costs,” often operating at a loss to grab market share.  It’s not a surprise to learn that some unicorns are terrified when they have to think about profits for the first time.  (For more in-depth analysis, check out this blog post by well-known venture investor Bill Gurley.)

All of these issues are things that we think about deeply here at the Martin Trust Center for MIT Entrepreneurship. We certainly want the startups that we help launch to be successful, not just in venture capital raised or achieving unicorn status. More importantly, we want that success to be sustainable and we want the entrepreneurial skills that we impart to be deeply rooted.

Think about trees for a second. Yes, much less magical than unicorns, but a tree has deep roots, a solid foundation, and branches that grow over time. We believe that with the tools that we provide to our students: from the proven framework of courses; to state-of-the art facilities; to advisory services; to our own delta v student venture accelerator, we are planting the seeds to help that tree grow. Obviously, drive and passion are important characteristics of successful entrepreneurs, but we know that entrepreneurship can be taught with a systematic, disciplined approach.

In fact, learning solid entrepreneurial skills might be even more important than launching a successful first startup on your first shot.

How does MIT produce so many successful entrepreneurs? We believe it’s all about planting a tree, rather than chasing a unicorn.

 

Innovation: 2017 Style

fuse_2Here in Massachusetts, we tend to get somewhat of an inferiority complex. Maybe it’s those Puritan roots. We have it stuck in our heads … “Boston’s not as big as NYC” or “We’re not as innovative as Silicon Valley” …

Wait?! Bloomberg says that Massachusetts is the most innovative state in America … for the second year in a row? That’s pretty cool. Take that inferiority complex!

According to the Bloomberg ranking, Massachusetts scored 95 out of a possible 100 points, followed by California, Washington, New Jersey, and Maryland. The six equally weighted metrics included:

  • R&D intensity;
  • Productivity;
  • High-tech density;
  • Concentration of science, technology, engineering and mathematics (STEM) employment
  • Science and engineering degree holders; and
  • Patent activity.

Massachusetts earned the ranking by producing more science and engineering jobs and by creating jobs in those industries. Current figures show a 2.9% unemployment rate in Mass, compared to a 4.6% national average. The state’s universities were also noted, included Harvard and MIT.

At MIT’s Martin Trust Center, we have the privilege of seeing that innovation every day.  And, it’s the type of innovation gets spread around the world. CES, the annual Consumer Electronics Show in Las Vegas is known for attracting and showcasing the world’s latest and greatest consumer innovations.  This year, atwoboo least eight companies with MIT roots showed off their cutting-edge products at the show. One of those, Woobo, is an alumnus of our MIT student venture accelerator program (now known as delta v). The company is using robotics and artificial intelligence to make a smart “imaginary friend” for young children and plans to launch the product this year.

Another MIT accelerator program alumnus, Accion Systems, was honored recently in BostInno’s 17 Startups to Watch in 2017. Definitely not in the consumer accionrealm, Accion is developing revolutionary propulsion for satellites which will make space more accessible and affordable across industries. The company itself is seeing quite a bit of propulsion here in Massachusetts, with funding from the Department of Defense and a Series A round last year, along with numerous awards.

img_0424And, here’s something pretty cool that’s happening in innovation right now: is MIT fuse program.  MIT fuse is the Trust Center’s entrepreneurial program that takes place every January during Independent Activities Period (IAP), which is January 9 to February 1 this year. The MIT fuse teams essentially take over the Martin Trust Center during these three and a half weeks, receive mentor advice from our Entrepreneurs in Residence, and learn from startup founders who have preceded them.

One intriguing company in the current MIT fuse program is Waypoint Labs.
Waypoint is building a platform for creating and extracting spatial data and insights for augmented reality (AR) applications. One possible applicawaypoint-labstion is using the Microsoft Hololens to enable non-pharmacy hospital staff to fill prescriptions quickly and without errors. The company was invited by AT&T to participate in its inaugural AR/VR Challenge at CES 2017, where it won the $20K grand prize after demoing its prototype to over 250 conference attendees.

At MIT, the students we mentor want to make a positive impact in the world, and our programs give these students the opportunity to do so.  Here’s to an innovative 2017!

Shining a Light on Female Entrepreneurs in Tech

Last night, MIT’s Martin Trust Center hosted a screening of the award-winning documentary “She Started It” which follows five women in their journeys to launch businesses in the technology industry. We were honored to have the director and co-producer of the film, Nora Poggi , with us to introduce the film and join in our discussion along with our own panel of budding tech entrepreneurs.

The event was inspiring and featured accomplished women who beat the odds. If one message came through “loud and clear” it was that the entrepreneurial journey is all about persistence and networking. Our discussion reinforced that entrepreneurship can be taught, and that practicing entrepreneurial skills will pay off in the end.

The “She Started It” film focuses on five female entrepreneurs and their experiences, along with empowering the next generation of women tech founders. (You can check out the trailer here.) The film cited statistics about being a female entrepreneur in the technology industry that were bleaker than a cross-industry perspective. For example:

  • Women create only 3% of tech startups
  • In Silicon Valley, women earn only 49 cents to a man’s dollar
  • Women receive less than 10% of venture capital funding
  • Only 12% of undergrad computer science degrees are earned by women
  • 96% of venture capitalists are men

Yet, the five women profiled in the film are out to break the mold.

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Following the screening, I moderated a discussion with Poggi and a panel of female founders sharing their own experiences. They included:

  • Elsa Sze of Agora which uses technology to bring more people to the civic conversation
  • Melissa James of The Tech Connection, a premier marketplace for purpose driven, diverse technical talent
  • Alex Wright-Gladstein of Ayar Labs which brings high bandwidths and energy efficiency of fiber optics to silicon chips
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L to R: Alex Wright Goldstein, Nora Poggi, Elsa Sze and Melissa James

 

The panelists discussed challenges and what is most intimidating about starting a tech business. The audience – which included many women in the process of exploring entrepreneurship for themselves was extremely engaged and had many questions. We also talked about how today’s female entrepreneurs can be role models to help other women and girls embrace the entrepreneurial path. Essentially, “you can’t be what you don’t see.”

One of the insightful quotes in the film is from Meghan Smith, Chief Technology Officer for the United States. She says, “There have always been women and minorities in all of the areas of technology for all history. It’s just the stories are less known. And so, we need to embrace our history and tell it to each other.”

Although women are a small minority of tech startup founders, it is also an issue that many women tend to understate their achievements, and not let their own light shine. “She Started It” is a first step to showcase some of these achievements. My thanks to everyone who participated in our event! It was a great success!

P.S. On a personal note, this week I received the exciting news that I’ve been selected as a finalist for the Stevie Awards for Women in Business the category of mentorship. As I worked with the panel for this our film event, I drew parallels to my own submission for the Stevie Awards. Often, as women, we dismiss the things that we do and don’t let our own lights shine (especially when surrounded by all the brilliance here at MIT). For me, this is a reminder to value our successes and share them with other women.

 

It’s a Wrap: MIT’s Educational Accelerator Demo Day 2016!

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Congratulations to all of the teams that presented at our Educational Accelerator Demo Day! We kicked off MIT’s campus-wide t=0 celebration of entrepreneurship and innovation, which will continue through September 18.

If you couldn’t join us, this post gives a quick recap; and you can catch all of the presentations on video as well. For an overview of the companies presented, check out this BostonInno article – “These are the 17 Startups MIT Kept Hush-Hush this Summer.”

First of all, in my last post I had let you know that our Global Founders’ Skills Accelerator (GFSA) would be changing its name. We are now MIT’s delta v accelerator.  Why the name change? The derivative of velocity is acceleration!  Hence, the MIT Acceleration Program delta v.

delta v literally means a change in velocity, and we believe this truly captures what happens to these students when they join us for MIT’s accelerator program.

The delta v Demo Day is focused on MIT students, and students filled the auditorium and were even sitting in the aisles. Our Managing Director Bill Aulet kicked of the program and explained how these startups have reached “escape velocity” and have been “kicked out of the house” so to speak.

Bill was followed by keynote speaker Dharmesh Shah, the CTO of HubSpot and an MIT grad. He talked about increasing the success for these student startups – how to get started, why you should avoid stealth mode, why speed matters, how to find a co-founder, attract amazing people, and give yourself crazy ambitious goals. He tells students to take advantage of all your classes to hone your skills… and he says he has never heard of a single entrepreneur who regrets taking a shot at a startup (even if it failed).

Governor Charlie Baker also joined us at Demo Day, and spoke about the amount of wizardry that comes out of MIT and the staggering contribution that MIT has made to the Commonwealth of Massachusetts, the country and the world.

It was then on to the student presentations. Fourteen startups made it through to Demo Day, and their company ideas covered topics from mental health to virtual reality.  We saw compelling videos from farmers whose lives have been changed because of MIT students, transportation in Rwanda and Mexico that will reduce costs for carriers, a way to make freight transportation more efficient and increase the income of truck drivers, and several ways to improve the environment.  We learned about innovations could change the lives of families dealing with cancer treatment and students in Africa.

Interested in learning more? Check out the companies that presented. They are listed below, in alphabetical order, along with links to their websites.  And, if you have a bit more time, check out the teams presenting in our Demo Day video recording.

Alfie
Armoire
Deepstream
dot Learn
Emerald
Factory Shop
FleteYa
Hive Maritime
kiron
Kumwe Logistics
Lean on Me
Leuko Labs
perch
Rendever
ricult
Solstice Initiative

I think everyone who attended Demo Day was inspired and impressed by the power of entrepreneurship at MIT. Now, we’re onward and upward, with t=0 this week with a full schedule of activities every day. Later this month, the delta v teams will be heading to New York City and San Francisco to meet with alumni and investors.

We hope you are inspired too!

Join us September 9th for MIT’s Educational Accelerator Demo Day!

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I’m wrapping up “boot camp” with this year’s MIT Global Founders’ Skills Accelerator (GFSA) cohort this week, and wanted to let you know about our Educational Accelerator Demo Day on September 9th! As Associate Director of the Martin Trust Center and the Director of the GFSA program, it’s been an amazing summer for me, helping to shape our teams of entrepreneurs and guiding them as they prepare to present their companies.

Sign up Now

On Demo Day, each of the groups that have been working in the accelerator will reveal their company to a live audience. This event is free and open to the public – just register here and then join us at MIT Kresge Auditorium; the program runs from 4 – 7 pm, and Dharmesh Shah, founder and CTO of HubSpot will be our keynote speaker.

Demo Day is the culmination of three months of intensive work and focus by our student teams in the educational accelerator. It’s the first chance to present their world-changing products and services to an audience of MIT students, mentors, friends, investors, and potential customers.

Who are this year’s Entrepreneurs?

Our 2016 cohort is bigger than last year with 86 entrepreneurs on 17 teams. We can’t reveal the companies or their concepts until September 9th, but innovative ideas will be presented by the fantastic teams – in vertical industries from healthcare to energy to logistics. To give you an idea of what Demo Day involves, here’s a round-up of inspiring startups from Demo Day in prior years.

As the premier university student accelerator in the world, the MIT GFSA provides a capstone educational opportunity for MIT student entrepreneurs and prepares them to hit “escape velocity” and launch their companies into the real world. We hope you can join us for this amazing event.

We’re Live Streaming too!

Can’t be there live? You can still watch the live stream. (Visit now and mark your calendar.)

After the Boston event, we’re on to New York on September 15 and San Francisco on September 22 to present Demo Day in those cities as well.

 

P.S. We’ll also be announcing a name change for the GFSA program at Demo Day … stay tuned.

Exploring India Accelerators

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In my role as Entrepreneur in Residence at MIT and Program Director for MIT’s Global Founders’ Skill Accelerator (GFSA), I’ve been researching accelerator programs worldwide, and I thought I’d share some of that research in a series of blog posts. This is the fourth post in the series; read the other posts starting here.

Most startups in India, irrespective of the apparent strength of their products, realized that they needed external support in the form of incubators and accelerators to grow and mature. At the early stages of incubation, most of these ambitious startups simply received funding, but as business complications began to surface, the need for mentorship, expert guidance, training, even technology-enabled office space became necessary components of accelerator programs. Though differing in operational models, the accelerators and incubators share one common goal—to provide an impetus to a brilliant business idea so that the idea succeeds and sustains as a commercial venture in this competitive world.

The accelerators provide mentors, guides, and a platform to raise issues ranging from venture capitals, legal problems, to technology enablement. Most accelerators in India expect equity in a startup in return for the valuable support system they provide. The accelerator program in some cases can charge a fixed fee and no equity for all the rendered services, and considers the startup success to be their biggest reward.

Here are some future predictions for the Indian accelerator program market as outlined in the Indian media platform YourStory:

  • To expand their global reach, accelerators will launch both online and offline programs.
  • The funding will shift from early-stage companies to late-stage companies. In 2014, and 300+ Indian startups have received over $5 billion.
  • As more corporate like Microsoft, Coca Cola, or PayPal continue to set up their own accelerator programs, the corporate giants will increasingly focus on funding startups.
  • Some accelerators will experiment with venture building models.
  • More vertical accelerators will surface in the advertising, medical, and food industries.
  • Investor networks and non-profit networks will collaborate to provide support and resources to startups.
  • Under-funded or direction-less accelerators will shut down.

A recent byproduct of this growing trend of “boosted entrepreneurship” is the growth of specialized accelerators for vertical markets, such as education, finance, or health. More and more, industry-specific accelerators are filling up the Indian accelerators landscape.

There has been a sharp rise in the number of Indian accelerator programs in the last few years. The best part is that this growth has come pretty much equally in all spheres. The rising wave has left its undercurrents in all spheres of Indian business, beginning with colleges with their own incubator cells, and global accelerators like Kyron Global Accelerators have turned to the Indian market for expansions. This particular accelerator aims to fund 300 Indian startups by 2020.

This article on the Top 50 Incubators & Accelerators in India, by Truelancer, lists the top India-based incubator and accelerator programs by region, and is a great resource.

If you want to read my next post in this series check back here on my blog or follow me on LinkedIn or Twitter.