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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.

Analysis of "The Internet Freedom Preservation Act of 2009"

ITIF Research Fellow Richard Bennett analyzes the Internet Freedom Preservation Act of 2009 (H.R. 3458) in an article in Internet Evolution.  The Internet's fundamental vibrancy and astounding ability to adapt to innovative new applications would be compromised by the overly prescriptive management framework the legislation proposes.  Regulators need to focus on protecting the Internet's capacity for change rather than preserving a flawed picture of its past.

Read the Report.

Talent, technology and tolerance key to attracting creative workers

A leading thinker on creativity believes attracting talented people is the driving force behind successful cities. In an interview with EurActiv, Richard Florida, author of 'The Rise of the Creative Class', said European countries are battling to attract and retain innovative people.

Bringing together a critical mass of creative workers, developing technology transfer infrastructure and fostering a bohemian, multicultural environment will be essential if European cities are to compete for mobile human capital, he said.

Canada needs new paradigm for research and innovation by Ron (CEO of Research Infosource Inc.)

Forget the apocalyptic statements about "deep cuts" to publicly funded research that fuelled headlines across Canada this past spring. In fact, university and hospital research funding rose last year by 5.2 per cent, to $6.1 billion, maintaining 10 years of solid growth.

Those doom and gloom warnings mask a deeper malaise over the future of research in this country. The larger problem is that policy leaders have run out of new ideas about how to tap the creative potential of the country's universities, colleges, research hospitals and, most important, companies.

Venture Capitals Open Secret

BURLINGAME, Calif. -- Sell a company for $50 million and you'd think the company's founders would be some very rich people.

Not necessarily. That's because conditions in the term sheets many start-ups sign in order to raise funding can quickly leave a founder's equity "sliding towards zero," says Adeo Ressi, founder of TheFunded.com, an online community for entrepreneurs looking to raise venture funding. Here's how it works. Start with a common clause called a "liquidation preference." It gives an investor the right to, say, 30% of the proceeds of a sale if they own 30% of the company. Fair enough, right? Well, many start-ups agree to terms that give investors 1.5 or even two times that amount.

Bring back private venture capital by Dr Mark Scibor-Rylski

Sir, Why is financing early-stage companies a task for the public sector? The regional development associations and the EU are not venture capitalists. Why has this sector been nationalised without protest?

We must be able to fund good new businesses as we struggle out of a recession, yet ineffective and often mirage state funding mechanisms are all we have left. We must bring back venture capital before even more new business opportunities are wasted.

Are 18 to 35 year-olds the innovation generation? - SmartPlanet

A widely-held belief is that younger generations drive innovation, but new evidence suggests that people aged 18 to 35 are impacting technology far more than the teenage generation that follows them.

An article in the New York Times details the immense growth of Twitter, which many falsely believe is the result of adoption by the text- and instant-message-happy generation who are currently teenagers, sometimes called Generation Z, or the “Internet Generation.”

How Long Does It Take To Build A Technology Empire? By Scott Austin

Oracle Corp., one of the world’s largest software makers, reached $50 million in revenue in its 10th year. It took software king Microsoft Corp. eight years to hit that milestone.

Yet many technology start-up business plans typically project revenue of $50 million in the first five years. The reality, according to new research from data visualization company Tableau Software, is that most tech giants come nowhere near those numbers in the first five years.

Venture capital shortage may stunt innovation, [Bendis] says in Cedar Rapids

Young business enterprises need financial investors to help them grow.

But the recession has slashed early-stage angel and venture capital investment in the United States, threatening a generation of innovation and eliminating the chance of creating thousands of jobs.

Richard Bendis, president and chief executive officer of Innovation America in Philadelphia and keynote speaker for the Entrepreneurial Development Center Client Expo on Tuesday in Cedar Rapids, says the situation is dire and needs federal government action.

An Entrepreneurial Silver Lining - SODA Inc

The SODA Inc focus is on entrepreneurship - specifically fostering the traits of entrepreneurs which allow them to grow sustainable businesses. Within the small business context this growth is what creates a business which stands firm through downturns and recessions. Although one doesn’t have to build a multi-national conglomerate, some small growth is necessary to cross the divide between ‘business owner’ and ’self employed’.

In Jonathan’s article below, he covers some of the advantages of entrepreneurship and the benefits of being entrepreneurial in a recession. entrepreneurial

When the Internet breaks, who ya gonna call? | csmonitor.com

At this point, it’s hard to imagine life without the Internet, at least in the developed world. But buried underneath the breathtaking Web applications and streaming media that we use on a daily basis, the actual software that makes the Internet work is starting to show its age.

As recent events have demonstrated all too clearly, the Internet is especially vulnerable to deliberate attacks. Massive networks of hijacked computers, known as “botnets,” can be used to deluge target websites with enough traffic to essentially shut them down, much as a radio station running a call-in contest will have a constantly busy phone number. These attacks succeed, at least partially, because they are able to exploit weaknesses in the existing Internet protocols.

How to Build a Culture of Innovation BusinessWeek

It's not that there had been no innovation inside Tata Group, the 117-year-old Indian powerhouse responsible for that nation's first steel mill, power plant, and airline, among other achievements. But when India's long protected economy was opened in 1991, Chairman Ratan Tata decided that for his companies to survive and thrive in a global economy he had to make innovation a priority—and build it into the DNA of the Tata group so that every employee at every company might think and act like an innovator.

All European Roads Lead Back to Skype

As eBay Inc. looks to offload Skype, the executives who sold the Internet telecom firm to eBay have formed the hub of a European network of investors and executives that they hope will rival and even exceed the one in Silicon Valley.

The sale of Skype to eBay for an estimated $3.3 billion in 2005 became renowned as one of Europe's great venture-capital successes, with more than half the sale price going to employees, according to estimates based on filings for the Securities and Exchange Commission and in Luxembourg. While those kinds of gains have been seen in Silicon Valley, ...

The Daily Start-Up: Will VCs Actually Use This Term Sheet?

Last week we mentioned how angel investor and entrepreneur Chris Dixon detailed on his blog the terms he thinks are ideal for first-round financings. Venture capitalist Fred Wison came out in support of the simplified term sheet, writing that the industry needs “to eliminate a lot of bad terms that have caused a lot of harm” and “converge on a set of standard Series A terms that everyone uses.” These posts inspired Adeo Ressi - the founder of The Funded, a site where entrepreneurs rate venture capitalists - to dream up the “Plain Preferred” term-sheet template that “aligns the investor and the entrepreneur incentives.” The Series A term sheet is designed to protect founders and save tens of thousands of dollars in legal fees. Let’s see whether venture capitalists will actually agree to such scaled-down deal terms, and if Fred Wilson and Brad Feld, another VC who supports the idea, will put their money where there mouths are. Earlier this year, Ressi came out with legal documents he believes will protect start-up founders from the “atrocities of investors.” Ressi tells us those founder-friendly incorporation documents are being used by about 50 start-ups….