Still an Idealab

Nearly a decade after rising to popularity during the dotcom boom and then melting into obscurity, Idealab is surprisingly still around.

Every time I pass by the offices in downtown Pasadena, about five minutes from where I live, I wonder what’s going on at the incubator that put so many Web startups on the map. If you’re wondering too, their investments — sidestepping much of today’s popular stuff like Web 2.0 technologies — show strategic plays in security, energy and robotics. Like many investors in Southern California and elsewhere today, Idealab seems to be just flying below the radar.

Commercializing new inventions

Could be another useful Webinar from Caltech: Assessing the Commercialization Potential of New Inventions, covering key topics on recognizing and capitalizing on opportunities:

• Nine key questions to better assess the commercial potential of new inventions
• Critical skills your company should possess to move inventions to the marketplace
• How to involve your customers in the commercialization process
• Taking technological leadership through acquisition of external inventions

The Blue Sweater may change you…

I just read a new book called The Blue Sweater by Jacqueline Novogratz. For weeks I’d seen reviews of this woman’s account of her journey to fight poverty in Africa, including one review that began, “Be careful, this book will change you…”

Novogratz herself begins the book with Nelson Mandela’s words: “There is no passion to be found playing small in settling for a life that is less than the one you are capable of living.”

This book does a great job of combining a personal narrative of finding one’s true calling with concrete examples of what any of us could do to help fight global poverty. It tells Novogratz’s story from her childhood to working in the banking industry evaluating foreign investments to starting her own fund to invest in entrepreneurs in poverty-stricken countries. The journey that her old blue sweater takes from her hometown to a child in Rwanda is a great story in and of itself about how we are all interconnected.

Novogratz delves into practical steps each of us can take, including some that are written about really well in another book called The Life You Can Save by Peter Singer. Singer’s book asks you to take a look not so much at what you are doing — and whether that makes you a good person — but at what you are not doing. This is more philosophy than biography, if that’s your preference.

I make no claims of being a great humanitarian. I try to do my part each year by donating to UNICEF and volunteer now and again for organizations serving my local community, but these books really did inspire me. And truth be told, made me feel guilty about how little effort it would take on my part to make a bigger difference.

Even if you don’t have time to read the whole book (which I rarely seem to do anymore), next time you’re at Barnes & Noble, flip through a few chapters of The Blue Sweater. It’s well worth it.

On entrepreneurship

Although it’s a well-worn cliche, great ideas really can come from anywhere. Innovation can happen in big companies as well as in garages. Someone who passionately takes this view is blogger and technology sage Guy Kawasaki, as he relates in this interview in the New York Times.

How will the credit crisis affect Silicon Valley?

It’s probably just a matter of time before the credit crisis hits Silicon Valley, as this article in the New York Times notes. The larger unknown is the potential impact on startups, venture capital and revenue as well as innovation. The dynamics of the current market may force players in the valley to adopt desperate measures in order to survive a potential shakeout on par with the dotcom crash. However, a lot of people may not be ready. In particular, I like this quote from Jonathan Abrams, founder of Friendster and Socializr:

“The economy is tanking and people are arguing about whether they should go to Demo or TechCrunch. Few companies sound like they are breaking new ground. It’s like, ‘Here is Twitter for dogs.’ And people still think they are going to get rich by being a blogger.”

“It seems to me like the industry is still in denial,” he said.

A look at incubators in Toronto

Although I’ve been in Southern California for almost a decade now, I still keep tabs on things back in Toronto where most of my family continues to live. My colleagues and I sometimes joke that the market in Canada lags behind the U.S. in technology adoption, but I’m impressed by the innovative approaches to partnering by organizations like the Ontario Centres of Excellence and MaRS.

Operating as a not-for-profit incubator, MaRs pools funding from the government and private investors to help businesses grow. The organization’s goal is to help elevate Canada’s competitiveness in the global marketplace by connecting entrepreneurs with capital and resources in Canada, thereby retaining local wealth and enriching the social and cultural environment.

The OCE is funded by the Ministry of Research and Innovation and the private sector to nurture ideas and collaborations between government, businesses and academic communities. It’s a way to commercialize R&D innovations, building on the investments that startups have made in themselves, or the research output from universities and colleges. The OCE explores everything from communications and IT to earth and environmental sectors.

I find the OCE approach especially interesting since many of their goals run parallel to what I do at alphaWorks, helping emerging technologies gain exposure, market feedback and commercial interest. I’m interested in learning about other groups out there with similar missions to these Toronto-based orgs. If this keeps up, I might have to think about moving back to Canada.

Recruiting techs from emerging markets

Like much of the tech industry, alphaWorks looks to emerging and growth markets to source technology. While many of our strategic techs come from primary labs in the U.S. like Almaden and T.J. Watson Research Centers, we’re also seeing many come from international labs in China, India and one that I have a particular interest in — the Haifa Research Lab.

Outside of the U.S., Israel is a hub of venture capital and investment growth, as well as entrepreneurial activity. Local as well as heavy international VC funds are helping to fuel startup development especially in telecom and wireless technology.

Historically, we’ve showcased innovative projects from Israel including one of our top downloads of all time, the IBM Toolkit for MPEG-4, which was a joint development between Haifa and T.J. Watson.

This year, I’m excited about a SaaS offering from Haifa/Almaden called PHIAD, an on-demand system that enables the public health industry to integrate and share data from public health institutions across proprietary systems and political boundaries. If adopted widely, this service has the potential to impact the management of global health information.

And there’s more in the pipeline from Silicon Wadi.

A new take on the VC game

One of the most interesting VC firms to watch right now is Union Square Ventures. They’ve been making waves with their unique approach to investing, and also because some of their primary investments in new media — in services such as Twitter and Tumblr — rely on developing (and very much unproven) business models. This New York-based firm is getting a lot of attention, recently presenting at the Web 2.0 Expo in NYC, and now, with an in-depth look at their investment strategy in the New York Times.

The changing VC landscape

I’ve been watching the venture capital landscape for a number of years. Lately–and there has been a lot of coverage on this (Slate, BusinessWeek)–the VCs seem to be retreating. Reminiscent of the pre-dotcom days, they’re investing more cautiously and in later-stage companies, often getting side stepped by real research and investment from large companies themselves who have VC arms set up specifically to spur innovation. The incubator model, celebrated by early companies like Idealab, seems to be returning too, with everyone from Yahoo’s Brickhouse to HP Labs and Disney focused on new models of internal investment and accelerated development. And at the same time, entrepreneurs are finding that it takes a lot less to get a business going, so why give up equity to a VC if you don’t have to. The VC community isn’t moving fast enough to keep up with the dynamics of the new market. I’m curious about what the folks on Sand Hill Road are thinking these days.