Supporting innovation and entrepreneurship

Colorado, like much of the rest of the nation, is grappling with how to deal with the implications of globalization and productivity gains over the past two decades. These trends have been gaining ground over the years, and both have led to a reduction in jobs.

This issue was at the forefront during the Denver Metro Chamber Leadership Foundation’s recent Leadership Exchange trip to Boston. Executive Director Maureen McDonald and her crew did an outstanding job of highlighting some amazing speakers and visits to expose the group to new ideas. For me, this was a bonus on this trip, as I have been involved with entrepreneurship and innovation almost my entire career.

The trip started with a keynote from one of the top innovators and entrepreneurs in the country, Gururaj “Desh” Deshpande. A successful serial entrepreneur, angel investor and global philanthropist, Gururaj “Desh” Deshpande is the chairman of Sparta Group LLC, A123 Systems, Sycamore Networks, Tejas Networks, Sandstone Capital and HiveFire.

As an entrepreneur, Deshpande co-founded Sycamore Networks Inc., an optical networking company that went public in 1999. Prior to co-founding Sycamore Networks, Deshpande was founder and chairman of Cascade Communications Corp., which became the market leader in Frame Relay and ATM technology and grew to $500 million in revenue between 1991 and 1997. In June 1997, Cascade was acquired by Ascend Communications for $3.7 billion.

Deshpande serves as a board member of MIT, and through the Deshpande Foundation that he established with his wife, Jaishree, launched MIT’s Deshpande Center for Technological Innovation in 2002. The Deshpande Center has awarded more than 80 grants to support the commercialization of a wide range of emerging technologies in the fields of biotechnology, biomedical devices, information technology, new materials, tiny tech and energy innovation.

Twenty-three companies have been launched from these grants and have collectively raised more than $300 million in capital. Further, Deshpande co-chairs a National Council to support President Obama’s innovation and entrepreneurship strategy with Mary Sue Coleman, president of the University of Michigan, and Steve Case, co-founder of AOL.

Deshpande talked both of innovation successes at MIT, how technology plus relevance leads to impact and then about social enterprises that he helped seed in Lowell, Mass., and India. The center in India serves as an experimental “sandbox” for social entrepreneurship. It has helped develop a midday meal program for schools that serves 1.3 million children and supported a wide variety of projects bringing innovation to education, health, agriculture and livelihood programs. Deshpande’s keynote speech was inspiring and laid out a blueprint of what the United States needs to focus on to retain its leadership in the world.

On the second day, we had an opportunity to visit the Cambridge Innovation Center — the largest incubator in the U.S. – which houses more than 400 companies in four floors in the center of Kendall Square It was eye-opening to see an ecosystem that is nurturing such a large number of companies all at the same time, creating jobs, creating wealth through innovation and entrepreneurship.

The offices were very beautifully set up with retro look and modern furniture. Nooks and corners that you can sit down and have a cup of coffee or a mid-day snack were everywhere, and young techies were going about with a fire in their eyes, no doubt, working on the next Google or Groupon. Anyone could come and take space in this vibrant ecosystem with all inclusive price of $1,100 a person a month. This included rent, furniture, phone, Internet, conference rooms, training rooms, participation in events etc.

Inspired by this tour, Charlie Knight (a lawyer from Colorado who works with startup companies) and I set up an unscheduled trip to two other incubators for the next day through a friend Raj Melville. One of these was Mass Challenge and the other Greentown, a cleantech incubator. Both were fortunately walking distance from our hotel. Mass Challenge was a floor in a beautiful high-rise that a real estate developer had given for free for five years to nurture innovation and entrepreneurship.

This place had an unfinished ceiling, no carpeting and furniture that looked like it came from 10 different places, likely for free. However, one could feel the energy in this space as entrepreneurs from all over the world were scurrying around in and out their open cubicles. We even got to talk an entrepreneur whose product was women’s shoes that have multiple-sized heels that could be swapped in 15 seconds. Based on our conversations subsequently with women in the LEX group, those shoes no doubt will be a runaway success.

The breathtaking view of the harbor from the conference room, however, was the highlight. Considering that the entrepreneurs pay no rent to be in the Mass Challenge program this was no doubt a huge draw. Entrepreneurs from all over the world apply to be part of this program and if selected have to move to Boston. They stay there for six months, and then some of them are winners for a grant from Mass Challenge (from a pool of $1 million). What an innovative concept! Bring people over for six months and whether they win or not, how likely is it that they will go anywhere else after that? Jobs for Boston no doubt.

The last incubator was Greentown, a cross between an abandoned warehouse and a loading dock. Jason Hanna, who founded this venture, is no doubt one innovative fellow. He took this space and built a combination of small manufacturing, plus lab, plus office space. You better watch where you walk though, with things sticking out everywhere.

Boston clearly showed its leadership in innovation and entrepreneurship, demonstrating a high tolerance for risk taking and accepting failures as a part of the process. It was a lot to learn for all of us.
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