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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.

oxygen tanks boatThe other day, Josh and I met with a very cool company that has some serious traction.  They’re more than doubling revenue every quarter and will soon be on track for a million dollar run rate.

The only concern was that they didn’t know what their cost of customer acquisition was, nor did they which channels would be most effective, or how much they could acquire out of each channel.  That makes it pretty tough to know how scalable the business is. 

The good thing is that customer acquisition is a pretty easily testable thing.  You can spend the next six weeks trying out a bunch of different channels and seeing what works, which is what we recommended.  It’s not about the traction—it’s about the information that de-risks your business and increases it’s enterprise value.  It’s a very different animal than an enterprise sales strategy.

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Mark Zuckerberg on the Facebook official blog said that the company had 500 million active users. An impressive number. However, a little thought could make you wonder just how accurate the claim of “actively using Facebook” might be, and whether some trends indicate that changing tastes and dissatisfaction with the service might not eventually do the same thing to it that they did to MySpace (NWS).

Start with how accurate that number might be. If you’ve any experience with social media services, you know that strange things happen. People get personal accounts and then maybe a second for a separately professional identity. (Yes, it happens on Facebook, as I’ve seen it occur.) More to the point, how many people do you know who signed up for Facebook and then hardly ever used it? Look at some stats from The traffic measurement site pegs the percentage of global Internet users who visit at around 35 percent. But that’s an estimate. According to the latest numbers from Internet World Stats, there are over 1.8 billion Internet users in the world, so 35 percent would be something north of 630 million. So Alexa may underestimate traffic — not surprising, as it estimates numbers from samples.

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Odessa, TexasEveryone knows the broadband in the United States isn't very good.

Significant portions of the country aren't wired for high-speed Internet at all, and where it is available, it often isn't as fast as broadband in Asia and parts of Europe.

But while everyone knows that our broadband infrastructure is bad, no one knows exactly how bad it is.

See 10 counties that broadband forgot →

For years, Internet service providers have blocked efforts to publicize information about broadband availability, ostensibly, to protect themselves from their competitors.

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Do you think that entrepreneurship is just for the young? That anyone past 50 is simply too old to start up a business? That midlife is the time when you should be thinking about retiring and preparing to live on less? If you do and if you are, then midlife entrepreneurship isn’t for you.

However, if you are someone who . . .

* likes to call the shots and live life on your own terms,

* has a strong desire for autonomy and independence,

* is a self-motivated starter,

* knows how to evaluate and take calculated risks,

* is highly self-motivated,

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It's funny when I think about it now, but growing up I always had an irrationally positive view of my older brother. Not only could he not do anything wrong, but I latched on to anything he said and internalized it. He once told me that “TV commercials are basically lies,” and to this day I can't watch TV without thinking I am having the wool pulled over my eyes. Pretty typical stuff for a kid growing up no doubt.

It’s the same story for the venture capital industry in Canada. I think that Canadian venture capitalists and entrepreneurs alike have developed an irrationally positive opinion of those outside their geography and asset class. Specifically of buyout managers and American venture capitalists. There is some fundamental desire to be just like them, to act like them, sound like them, and look like them.

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Private equity players in the Middle East face a major challenge. With an estimated US$11 billion in un-invested funds raised before the global financial crisis in 2008, PE firms in the region are under mounting pressure to find and make meaningful investments.

At the height of the PE industry in the region between 2005 and 2007, there were about 70 transactions a year, with an average size of US$30 million. Using this yardstick, it would take more than five years to invest these funds.

As PE investment firms have to invest their existing funds before they can raise additional capital, there are some concerns that deals may be done “at almost any price” despite weak investment opportunities, according to a new report based on a joint survey of PE investment firms and investors by INSEAD and management consultancy Booz & Company. However, the same report highlights that the industry has drawn important lessons from the crisis and most private equity firms or general partners (GPs) are expected to exercise stronger investment prudence and proper due diligence. This may explain the recent focus on SME investment by some top companies.

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The geographical expansion of innovation networks globally is giving rise to various forms of hybrid systems of innovation in which established innovation hubs cooperate with agents and organizations scattered all over the world. Any innovation ecosystem can develop a hybrid dimension by using digital / virtual platforms either to extend the innovation supply chain and profit from technology providers located in remote regions or to involve users in the innovation and product development processes. In both cases, the virtual space (composed of networks, online tools, and e-services) enables a wider involvement of suppliers and users, changing substantially the dynamics of innovation.

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Making fun of the Transition's looks seems like a low blow, but I'll tell you why it isn't: The vehicle is meant to herald an era when airplanes become mass-market consumer goods, just like sports cars or power boats. They have to meet a pretty high bar in their design, if they're to compete with each other. After all, for now it's almost a pure luxury good--and that means you better look damn good piloting it. Which is one reason why a competing aircraft, the Icon A5, looks stunning:

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BSounding the alarmy dropping the social in innovation, is North America breaking the innovation chain?

Andy Grove, a co-funder of Intel and a Silicon Valley icon, is sounding two alarms about innovation’s future. Both flow from his disagreement with the accepted article of faith that the US tech sector necessarily should focus high-end jobs in the US and export manufacturing jobs.

One alarm is that US innovation is dropping the ball in job creation. By exporting manufacturing offshore to Asia, the United States is focusing on start-ups.  “Start-ups are a wonderful thing,” says Grove in a recent essay in Bloomberg Businessweek, “But they cannot by themselves increase tech employment.”

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Even as China is poised to overtake Japan as the world’s second-largest economy, its foreign policy is driven less by its sense of its role as a key global player than by a set of ‘narrowly defined’ national interests, says Professor Kenneth Lieberthal, Director of the John L. Thornton China Center and senior fellow in Foreign Policy and Global Economy and Development at The Brookings Institution.

Certainly, China could “make a big difference” on major global issues such as climate change, nuclear proliferation and the global economic crisis if it chooses to, Lieberthal told INSEAD Knowledge on a recent visit to Singapore.

“I think (China) is still in the early stages of figuring out how to be a global player. It still isn’t comfortable yet with what the balance ought to be between following China’s very narrowly defined national interests, versus contributing to global common goods, global stability, global rule-making, global institutions that are vibrant,” says Lieberthal.

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Pennies from Heaven: Angel investors can bring money and expertise to fast-growing companies.Looking for someone with deep pockets and big ideas? How to find an angel investor who can take your company to the next level.

So you have a great business but can't find enough money to take it to the next level? And you just know that if you found someone with good intentions and deep pockets, also known as an angel investor, he or she would see the light and invest in your company -- and everyone would get rich?

It's certainly possible -- and improbable all at once. In this economy, money is tighter than ever, and yet angel investors are out there, forking over their capital and helping startups. According to some estimates, there are at least 140,000 active angels who invest some $20 billion a year in new businesses.

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