Chicago Innovation Center Exploration

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I traveled with a Minneapolis based economic development company to Chicago to meet with some investor / advisors to explore real estate investments that would include building innovation centers.  As a strategist for Cheval Partners,  I had put together the primary concept deck that detailed out core services and technology platforms that would be required directly for the center and the overall concept of real estate development that would integrate the innovation center to industry parks, conference centers, education centers, transportation hubs, and lifestyle… etc.   The overall discuss positioned the value propositions and long term benefits to the region and the opportunities for integrating with centers around the globe for access to global innovation opportunities.   There were many learnings about Chicago political and economic histories and current initiatives and trends.   Chicago sits at the cross roads of the nation, but its transportation infrastructure is aging and has been outstripped by population growth.   A key challenge for the city is to invest sufficiently in infrastructure and in new forms of multi-model mass transit.  His is required both for the continued growth of the city, but also so it doesn’t serve as a transportation bottleneck of east / west transit.   The city is also evaluating its future identity in terms of industry.   While it remains strong in the financial sector, there is consideration of the reclaiming a lead in manufacturing as the outsource trends slow and become both cost prohibitive and fraught with international issues.   Already project are underway developing new manufacturing zoned districts and the Joliet canal system is progressively looking to the future.   Chicago has already begun some partnerships with technology vendors like Microsoft & Google to have high tech centers, but larger opportunities still exist to build more industry centric centers to fuel B2B collaboration and start-up acceleration and commercialization.

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Mayo Ventures Meeting

Mayo Ventures

I presented the North-Star Initiative to Mayo Ventures leadership.   The meeting was an overview of the development of innovation ecosystems through the creation of innovation centers focused on industry clusters.   Mayo has been a leader in the Rochester region in direct corporate to startup incubation.  The conversation spanned the center model of co-opition between corporations, government, academics and entrepreneurs to spur the overall ecosystem and bring new ideas to market at a combined scale vs. individual efforts.

 

Technopuc / Brazil Corporate Research Park

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I was able to sit down with researchers working at the Tecnopuc corporate research park in Brazil to discuss the best practices around the implementation of the park,  innovation services, and research on how collaboration is forming in these large scale centers.   This park is a more traditional corporate research park that has been springing up around the world in countries across Asia, Europe, Australia, and South America.   Here large number of industries start to converge around concepts of collaboration, innovation, strategic partnerships, shared services, research and financial incentives.   For many large companies participation in these global parts is a critical success strategy for both global partnerships and as entry points into new markets.    Technopuc also features an integrated university that is supporting the park and doing research across industries and innovation. The number of shared services is relatively low at this point,  so much of the networking research today is focused on serendipity vs. actual facilitation and orchestration.   Even the research around serendipity alone is impressive showing the collaboration and partnerships that organically occur do to simple proximity and shared communication.   This type of research will only become more in-depth as new model of centers are created that combine more shared infrastructure, education, innovation, and commercialization services in a shared services model.    Also the trends to network these parks globally will change the ease and level for cross global collaboration and sharing of knowledge.   Not to mention accelerate the data and research possible in studying global innovation and business trends.    We will continue to watch the progress and research from these institutions and keep the dialogue open to review the new models for centers we are currently developing working with international teams.

Park Details:

Figures

  • 62 Companies (Accenture, Datacom, DBServer, Dell, HP, Instituto Eldorado, Microsoft, Parks, Stefanini, Technotag, ThoughtWorks, Tlantic/Sonae, TOTVS, )
  • 8 Institutions (ABINEE, Assespro, Softsul, Instituto Liberdade, Fundao Pensamento Digital, PMI, …)
  • 11 PUCRS Research Centers and PUCRS Operations (Nanotechnology Research Center, Molecular and Functional Biology Research Center , Solar Photovoltaic Research Center, Energy Radiation Research Center, Electric Energy Research Center, Carbon Storage Research Center, AGT, ETT, INOVAPUC, etc)
  • 3 PUCRS Operations (TECNOPUC, AGT and ETT)
  • RAIAR Incubator: 18 start-ups, all of them academic or research spin-off projects
  • More than 2,600 certified personnel (employees)

 

Academic Impact

  • 144 ongoing R&D Projects
  • 59 PUCRS researchers involved
  • 241 Master’s and PhD Scholarships (directly allocated in R&D projects)
  • 320 Master and PhD Scholarships (TECNOPUC research fund)

 

Paris & Co – European Incubator

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The Innovation Advisory Board facilitated introductions to several innovation centers around the globe.   I was able to talk to the center director of Paris & Co.    It is important to start with some context of the development of the innovation ecosystem in France and Paris specifically.  In 2008 ~ 2009 there was almost no startup activity or venture capital investment happening in Paris due to the global recession.  In partnership with the City of Paris, French Government, and philanthropic investors, an incubator was launched to start to organize the activities within the area in 2010.  They studied incubation models around the globe taking note of best practices and approaches.
Many accelerators and incubators began to launch featuring different models.   Their particular focus as a non-profit,  late stage incubator.  The start-ups had to be fairly mature in terms of organization and business plan with a product ready to take to market to enter their services.   Their incubation lasts for two 12 month cycles.   If a company completes the first cycle,  they are evaluated for a second cycle.
Their services include education, incubation and corporate services.   They both funnel start-ups to other incubators and their own.  What is of particular interest is they don’t take equity;  it is paired through fees, corporate memberships, and sponsors.
2014 performance:
– Incubated 200 startups for a total of 590 to date.  ( vs. 100 in mass challenge in 2014 )
– 78% survival rate
– Raised 85M(€) in VC capital
– Startups in incubation earned over $5.1M(€)
– Served 5300 employees of the start-ups
– Securing sponsors for events,  start-up, and student programs
– Corporation partnerships for corporate incubators
– Corporations don’t take equity at this early stage – its about access and deal flow.
– Corporations actively engage in with their portfolio bring a range of people, tech, and networks to support the maturation
– $7.5M dollar annual operations budget,  this budget is rapid growing annually as they expand in scale, numbers of incubators, events, employees, and services.   (Note:  that is about 43% public funding and 57% private, but the trend is rapidly shifting to private )
At the beginning of 2015:
– 10K-12K start-ups in Paris ( Note:  about 7K in NYC )
– They had grown to 10 separate incubator facilities, each focus on a specific area or topic.  i.e.:  Clean Energy,  Tourism, communication, Agri,  Mobility, High Tech, Media,  Video Games,  etc.
– They employee around 50 people across the 10 incubators and are growing in size and partnerships.
Momentum:
– Paris now has about 50 – 60 other incubators,  plus a large number of co-habitation and maker spaces
– Frequent events, contests, and hackathons
– Over $800M(€) annually in VC money in Paris compared to almost none in 2008
– A new 1000 start-up sized incubators are being planned for the city
– Creating a gravity to other countries to participate in their ecosystem.
Many of these practices and trends were mirrored in conversations with other cities/ countries on the proactive efforts to improve their innovation ecosystems.   Our research has been following the development and evolution of methods being applied and overall impact.
Many cities are still struggling to provide cohesive sets of service providers to cover the full life cycle innovation.   Many prefer to focus on late stage as the potential valuation of products is better, but the opportunity still exists for developing a much larger funnel of emerging startups to mature/fail/ pivot faster with less time and capital investments.   This increased scale of deal flow would attract more start-ups and investors to the regions.    It is also clear that the ecosystems are going to continuously and rapidly evolve from their current states.  What we are seeing today in most regions are the basic formation patterns of services and funding models.   These are great as an entry point, but will need to evolve to handle an increased scale of activity.   They will also need to address the complexity of lifecycle investment models to create a sustainable integration of services across providers.  Increase in cross-regional and international integration processes.
These conversations were both informative and conveyed the energy and excitement that is happening in regions around the world.

Mayo Surgical Innovation Team

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I visited Rochester Minnesota to meet with the head of the innovation team emerging out of the surgical unit at Mayo clinic.   This is an internal initiative of the clinic separate from the Ventures group already operating with start-ups.    It is focused on leveraging the internal insights & ideas of the surgical teams and practitioners are seeing on the front lines of the business.   It can combine internal resources with the start up community to try and bring some of these ideas to life more rapidly and engage the staff in new ways.   I was able to share the models and services the university was exploring developing and the potential for synergy was evident.    While this new group was just forming I look forward to following their progress and to see how Mayo integrates the intrepreneurship with its venture teams.

Meeting with MN State CTO

MN.IT LogoAs a follow up to my meeting with the State CIO,  I was introduced to the Minnesota State CTO, Ed Valencia, to present an overview of the North Star Iniative for building Innovation Centers in Minnesota.  This meeting was exceptional in the level of advice and coaching towards working with State Government and key contacts to engage with.  Alignment over data created synergy for future pilot projects around public data.  Looking at next steps.  I will be meeting with MN DEED and Greater MSP in the coming months to share details of the initiative and see what level of interest exists for collaboration.

 

Expo 2023 & North Star

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I was invited to speak at the July 2014 Expo 2023 event.  I gave an overview of the North Star Initiative that had been researching best practices for innovation centers and corporation innovation practices.    Innovation center are key drivers for economic development and a potential showpiece for the World’s Fair.   Their productivity comes from become a nexus of collaboration and co-opition creating opportunities through programs and serendipity that would not be possible without a focused environment and network.   The core of the best models revolve around corporate consortiums.   Their funding, combined with state & federal grants fuel the programs that support both start-up and corporate ventures.  Events range from industry, networking, venture capital, and student focused engagements.   Events and programs provide the tempo to keep the ecosystem moving and people to create plans and milestones around to make use of the events.   I have been seeing corporate to corporate joint ventures and shared patents being one of the strongest drivers and attracts corporations to have offices directly on premise.   That also positions them to be in the constant deal flow of new and maturing starts putting them on the pulse of opportunities and trends.   Universities play a key role as well bringing expertise and educational programs.  Students benefit on multiple fronts.   They can get a deeper level of entrepreneurial experience,  network across corporate mentors,  gain access to venture capital programs,  and intern directly in the centers working on start-up and corporate ventures.

Q&A that followed after the presentation focused on how we could get the center programs started.   I shared a few key first steps that provide the catalyst for many regions:

  1. Regional Clusters must be identified to prioritize the order and focus of the initial centers.   This must a balance between what the region may be known for and sectors that are emerging.
  2. State Government needs to publicly get behind the initiative and provide some basic funding to have skin the game.   State programs can be tailored over time to strengthen center programs.
  3. Corporate consortium need to be engaged based on the sectors prioritized.   Corporations play the leading roles in the success of centers.  Usually there is the core group that opt in early and become leading board members and sponsors during the design and roll out.  My tiers of corporate partnerships can be defined over time.   The majority of funding comes from corporate and venture funding.
  4. Federal grants are also key resources for center development, but competition between the states is high.   It is best to be through steps 1-3 when entering the granting process
  5. Universities need to play and active role.   While centers can provide new revenue streams to schools through commercialization and program revenues,  there needs to be a high level of volunteerism from the facaulty.
  6. Student programs and internships should be designed into the programs at the beginning.
  7. Corporations should look at centers as a new resources for employee development and lifelong learning.   Employees and executives should rotate in and out playing a variety of roles including teachers, coaches, mentors, board members, program developers, industry experts, commercialization strategist, and network facilitators.   Time embedded into the centers will broaden their entrepreneurial skills,  increase their own networks, and put them on the pulse of innovation in the region.
  8. Centers are built to also collaborate with other centers both regionally and globally.   International corridors should be established to bring the best ideas, talent, and investments into the region on a regular basis that is integrated into the tempo of standard programing.
  9. All stakeholders from government, corporate, academic, and venture community will need to play roles on boards and in center operations.  There are four types of board alone including operational, governance, funding, and investment.
  10. Regional should have many centers with different focuses, but they can all share resources and collaborate around all aspects of operations including  events and commercialization activities.

I was impressed with the energy and enthusiams around the topic.  I had many senior leaders approach me after the session that lead to many follow on meetings.

Initiative like this align well with the worlds fair.   Their challenge is that they need to be pursued and implemented to be fully in business to showcase the region when the fair brings the world to our door.