Wednesday, December 23, 2009

Lending to small businesses

The December 12th issue of The Economist includes an article "Small business, big problem" regarding the continuing difficulties small businesses have in obtaining financing. A few pithy bits:

"America's large firms get 30% of their financing from the banks; its smaller enterprises rely on them for 90% of their financing needs."

"Small businesses account for the majority of private-sector employment in America and Europe."

"Firms with fewer than 500 workers accounted for 64% of the net new jobs created in America between 1993 and the third quarter of 2008."

The article in particular proposes that governments "offer relief on payroll taxes for firms that are vibrant enough to make new hires."

Is anybody in government listening?

Social Networking for Innovators

A year ago at the Connecticut SBIR conference, I met Ryan Bloom, Vice President & Cofounder of Boliven, a social networking site for "Innovators at Work". It took me the year to follow up on his invitaiton to join the site. But I heartily recommend it as a venue for researchers, PIs, entrepreneurs, and innovators.

The basis behind it is to link people with each other based on a portfolio of their work, their contracts and grants, their patents and journal articles. The network is based on these tools of the trade. Their on-board searches are intended to find your efforts, and permit you to add them to your portfolio. Your coauthors are linked as part of your network. You receive updates when one of them is listed on a patent or has received a grant.

It's still a young network, but they seem open to and eager for further refinements. For instance, there is definitely room for improvement to their automated searches. A great deal that should show up doesn't, and there isn't yet sufficient facility for adding things. But I'm convinced it will continue to improve, and will prove a useful resource for those of us involved in innovation. Check it out.

Tuesday, December 22, 2009

Still not quite convinced

Understanding motivation can be key. My friend Fred Patterson, the SBIR Coach, calls it WIIFM: What's in it for me?

Only... we're sold a bill of goods by common assumption, that it's we, the entrepreneurs, the inventors, the scientists, the researchers, who must go as supplicants to the trough of Investors, tripping over ourselves to convince the moneyed that we are worthy of their largess.

I'm still not quite convinced. Turning the tables, I wonder "what's in it for me"? See, I'm a lone researcher, a radical, an oddball, who after several years as supplicant at the trough of Academia, after 150 faculty applications, and a miserable stint of Adjunct Servitude, decided to shirk the bonds I had willingly taken on, and head out on my own.

I stumbled into SBIR. And, now, little more than a year and a half later, my firm is growing from one, to a staff of six (four full-time). We're patent pending, about to start our first Phase II, and our second Phase I with a different agency on a related but distinct project.

I believe in the mission of SBIR to support innovation wherever it lurks. I believe in SBIR as an open competition of ideas, not as earmarks. I believe in the wise use of public funds to spur and stimulate and foster and fertilize the fragile seeds of innovation. What a wonderful idea: small pots of money for outstanding ideas, to support a short path to proof-of-concept.

What's in it for me? I have learned. A spare six months to delve whole heartedly into the realm of my passions, to test the mettle of my ideas, to drive those naked thoughts into evidence. Yes, indeed, this will work, and it will solve your problem. Then, the chance to compete for Phase II funding, to support a full-scale R&D effort for a couple years, creating high-quality jobs along the way. Finally, the chance to make those dreams a reality by commercializing the results of those ideas and that passion, solving real-world problems, paying back the largess of public coffers. That's a win for everyone.

But what's in it for me to (possibly prematurely) sell off parts of my firm to investors, whose interest may more likely begin and end with dollar signs, not passion, or ideas, or public interest? I'm not much for knocking on doors, beating the bushes, and doing a song and dance for investment.

I'm not much for paper entrepreneurship, writing dazzling business plans. Sure, I can project millions in profits like the best of them. Only, it's far more interesting (and difficult) to actually achieve it. Do I need private investment to get there? Will private investment ensure I get there? Will it help?

Those are the important questions. I can't say I know the answer just yet. I'll answer a knock at the door, and listen in earnest to the pitch. But for now, I think I prefer if they work to convince me. I always enjoy a good song and dance.

Monday, December 7, 2009

Separation of State & Science

The November 28, 2009 issue of The Economist includes a pithy opinion piece, ostensibly addressing the need for allowing the voice of a skeptical minority of climate scientists to be heard in the midst of political wrangling over climate change. More significant than the specifics of the context however is the broad-reaching argument regarding the necessity of separating scientific debate from political maneuvering. Here is a concise formulation from the end of the article:
There are no certainties in science. Prevailing theories must be constantly tested against evidence, and refined, and more evidence collected, and the theories tested again. That is the job of the scientists. When they stop questioning orthodoxy, mankind will have given up the search for truth. The sceptics should not be silenced.
Well said, indeed!