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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.

Where do innovations come from? How do you generate an idea that is so radical yet so compelling that it fundamentally changes customer expectations or the cost structure of an industry or the basis for competition?

Many ascribe innovative ideas to a mysterious mix of happenstance, individual brilliance and the occasional bolt of lightning. Clearly those things are part of the equation, but there seems to be more at play in the minds of radical innovators like Steve Jobs, Richard Branson or Jeff Bezos, who have come up with genuine breakthrough ideas.

Look at case after case of successful business innovation, and an interesting pattern begins to emerge. What you find, time and again, is that innovation comes not from some unique inspiration but from looking at the world in a different way. It comes from having a fresh perspective, an alternate way of seeing things, an angle of view that lets you see through the familiar and spot the unseen.

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chart of the day, annual revenue per employee, 2009Even with a highly lucrative search business, Google is not getting the most revenue per employee in the tech world.

This analysis, from George Morris at 37Signals, shows that Craigslist -- with its tiny staff -- is getting three times as much revenue per employee as Google. Obviously, Craiglist is a unique situation, and it doesn't scale infinitely, but it's still very impressive.

Why does this chart matter? It emphasizes efficiency in business. You can see which companies get the most of out of their staff.

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puzzlepiece_apr10.jpgEarlier in the week we mentioned a preview of a presentation Steve Blank is giving this Friday at the Startup Lessons Learned conference in which he describes how startups and larger companies are unique and have differing needs. One of the ways they distinguish themselves from one another is that the roles of executives play out in very different ways, and sometimes startups make the mistake of hiring execs that would fit in better with a larger company. Ben Horowitz of Andreessen Horowitz wrote recently on this very topic and provided some hints to startups looking to hire execs.

Startups are young and small by their very nature; after all, once you get older and larger, you're not really a startup anymore. With that, they require a different style of leadership than larger companies. Startups need executives who are constantly active and who are hands on, and having passion for the company is a serious plus. The more the executives reflect the attitudes of the founding entrepreneurs, the better.

This differs greatly from the atmosphere created for executives at large companies. As Horowitz recalls, when he worked for Hewlett Packard, his job was driven by the swarm of outside activity which came to him and created his daily work-flow. Less of this, he says, goes on with startups, and at times a new exec not suited for startup culture can find himself feeling a bit like a fish out of water without any clue as to what to actually do. He calls this a "rhythm mismatch."

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donut holeFor 30 years John Margolies has been documenting the diners, drive-ins and motor lodges that remain along our highways as box stores and strip malls slowly erase the quirk and character of consumerism. His book Roadside America collects nearly 400 photographs of this vanishing vision of over-the-top architecture, automotive freedom and the American dream.

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The heads of the worlds five largest intellectual property offices agreed to move ahead on ten Foundation Projects, to provide a framework to support work-sharing, at a meeting in Guilin, China last week.

The five IP offices, or IP5, are the European Patent Office (EPO); the Japan Patent Office (JPO), the Korean Intellectual Property Office (KIPO), the State Intellectual Property Office of China (SIPO) and the United States Patent and Trademark Office (USPTO). The meeting was also attended by the Director General of the World Intellectual Property Organisation, Francis Gurry, as an observer.

The heads agreed the ten Foundation Projects are crucial in building a work-sharing environment and expressed their willingness to explore appropriate ways to speed up the process.

The importance of transparency in the IP5 process was agreed, as was the need for effective communication among the five offices, particularly with and between examiners, and with stakeholders.

Underlining the importance of the WIPO-administered Patent Cooperation Treaty in work-sharing, the five heads reaffirmed their commitment to collaborating with WIPO to improve the system, so its role can be further strengthened, as the vehicle for efficient work-sharing.

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Despite the fact that China led the world in clean energy investments last year, the Chinese government is now backing away from ambitious plans to plant megawatts of solar in the country.

Concerned by the high cost of solar -- which can be four times more expensive than fossil fuels -- and fears that solar power won't deliver on some of the anticipated goals, the Chinese government is not about to subsidize solar power on a national level, Shi Lishan, deputy director in China's energy bureau, said in an interview with Guangzhou's 21st Century earlier this month.

A couple of weeks ago, the state-run China Securities Journal carried a similar report, saying that the funds shortage blocks the central government from introducing a feed-in tariff. Already, the government's annual subsidy for solar PV projects has hit RMB 7 billion, or more than US$1 billion, according to Wang Sicheng from China's National Development and Reform Commission, as quoted in the report.

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cloud cityBack in February, John Treadway, director of cloud computing portfolio at Boston-based Unisys, wrote that, "I think we might be at the very beginning of an interesting new phase in the evolution of cloud computing -- regional and local clouds."

Treadway rightly points out that local and regional hosting is hardly new, as smaller players have been "operating in the shadows of the big hosting companies" for many years. Such firms often simply resell the data center capacity of large players, he notes, but some of them have their own facilities. North Carolina's Hosted Solutions and Massachusetts' InetServices are two examples. Another is Minnesota-based's recently launched Reliacloud.

According to Treadway, it's only natural for some local hosters to start new cloud initiatives to keep their customers from ending up at Amazon, Rackspace or the like. "Some will be successful, while others will fail," he maintains. But he predicts that a market segment will develop for regional cloud providers.

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Washington, D.C.--If it's dirty, it's gold.

That's one of the underlying themes at Creating Climate Wealth, a two-day conference taking place in Washington, D.C. this week. Instead of talking about solar or wind, a large number of the discussions and talks revolve around cleaning up ports, recycling and other somewhat anonymous industries not generally associated with fresh breezes and blue skies.

The term "gritty green" was uttered by Craig Cogut, the founder of Pegasus Capital Advisors, a private equity firm with a number of investments in efficiency. He used the term to refer to iGPS, a portfolio company that specializes in shipping pallets fashioned from recyclable plastic.

There are roughly 90 million shipping pallets in the U.S. and millions more worldwide, he noted. Until recently, virtually all of them were made of wood. The plastic pallets weigh 45 pounds, versus 75 pounds for a wood pallet, he noted, which in turn reduces fuel consumed in transportation. You also don't have to chop down forests to produce them.

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Constructing the perfect city means blending the best and boldest ideas from across the nation. Here are 12 we hope all future cities will embrace.

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SSTI Weekly Digest

In response to dwindling state funding and concerns related to leadership, focus and productivity in the state's current economic development model, Arizona Gov. Jan Brewer announced the creation of a new quasi-public state agency to focus on targeted industries such as solar, science, technology, aerospace, and defense to help the state grow jobs and remain globally competitive. The Arizona Commerce Authority (ACA) would replace the Arizona Department of Commerce, but does not assume all of its current functions. In addition to an annual appropriation from the general fund or another dedicated state funding source, private sector funds would be used to support the marketing efforts of the ACA. These funds come from a 1.5 percent fee charged to companies accessing certain state incentive programs. Read the press release or the  full report from the Governor's Commerce Advisory Council.

The Kauffman Foundation (H/T The Scientist) points to the Carolina Express Licensing Agreement (CELA) as an idea worth pursuing at other institutions.  As the Foundation outlines in a paper released this week, the CELA was developed in a collaborative effort between University of North Carolina faculty, technology transfer officials, and venture capitalists.  A standardized agreement runs counter to advise from the Association of University Technology Managers, which recommends that any technology transfer agreement must be customized due to its unique circumstances.  However, digging further into the agreement and the report, I’m not sure the two perspectives are in great conflict with each other.

The focus of the CELA is not on agreements between existing companies and the university, but between the university and faculty seeking to form start-up companies. Some may argue that in the realm of licensing this distinction doesn’t matter that much, but I’d point out that existing companies have the potential to organize in industrial groups and otherwise exert some influence on policymakers to help make sure their interests are given appropriate consideration.

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President Obama’s budget request for fiscal year 2011 would direct $32.2 billion to the National Institutes of Health. That’s a boost of about 3.2 percent over the baseline budget from the previous year, and last week a coalition of 25 governors from across the country sent a letter to congressional representatives explaining the benefits of the investment and urging that they incorporate it into the final budget due later this fall.

The American Recovery and Reinvestment Act directed an additional one-time stimulus of $10 billion to NIH last year, a sum that helped offset the flat funding for the agency from 2004 to 2008. But “flat” actually meant that the NIH saw the purchasing power of its inflation-adjust budget dip 13 percent over that period.

In the letter, the governors point out that their states received $19 billion in grants from NIH last year, and funding from the agency directly supports 350,000 jobs around the country.

But most importantly, the governors write that the “greatest contribution NIH makes is to the health and well-being of Americans.” The agency funds research on everything from vaccines to cancer therapies—from investigations into the genetic roots of disease to the traumatic brain injuries suffered by U.S. combat troops.

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