How “Place” Matters in Innovation
There has been a lively debate following Scott Kirsner’s Innovation Economy blog “Why Waltham Doesn’t Matter.” One of the threads is whether it matters if entrepreneurs and VCs are physically concentrated close to each other.
It should not matter where a VC’s offices are located. Good VCs and entrepreneurs will find each other. Andrew Perlman, who co-founded several local big successes, including Coatue, Sirtris, and GreatPoint Energy, in my observation is almost never in his office. He is out meeting investors and other potential collaborators wherever they may be. On any given day someone like Andrew may be found in his Cambridge office, or at a coal mine in the midwest, or in a place like Novosibirsk, Russia’s science city, where he acquired some of the core technology for Coatue.
This can be true for VCs as well. Based on how often I see Bob Metcalfe outside of his Polaris Venture Partners office, I’m not convinced he has one. Celebrated West Coast VC Vinod Khosla has had no trouble investing in young companies in the Cambridge area, such as iSkoot, Mascoma, and GreatPoint Energy.
But these are our superstars. Many of the rest of us find it hard to make connections. This is particularly true for newcomers, such as the roughly 3,000 new arrivals at MIT each year. They may be amongst the smartest people in the world, but they don’t know anybody and they often have limited social skills. How has this group of people consistently pumped out some of the world’s most important technology companies?
This is where the density of Cambridge kicks in. People working and studying in and around Kendall Square meet constantly and informally: at myriad talks at MIT where you are likely to run into a Nobel Laureate, at gatherings we can walk to after work before heading home, in the hallways of our tightly clustered buildings of powerhouses like Google, Microsoft, Akamai, Genzyme, Novartis, and Biogen Idec, at local watering holes like the Muddy Charles, and at loosely structured meetups, such as those at Bijan Sabet and Nabeel Hyatt’s OpenCoffee Club at Café Andala in Central Square. These chance meetings are where a bright kid from Israel gets urged to start a company, how a new entrepreneur first “clicks” with an investor, how an investor helps find a great CFO for that entrepreneur, and how a lawyer offers to kick in the time to get it all incorporated. Stuff happens here, and this is why Cambridge matters.
We tend to take this for granted, and we miss its importance. Anyone who has spent time in other science and technology regions, such as Cambridge (England), Shanghai, or Silicon Valley knows that those places are spread out and broken up. Key labs, companies, and universities are so far apart that getting together may mean a two-hour car drive.
How do we make the most of this unique structural advantage? There are many great role models out there. Joost Bonsen, another Xconomist, helped create MIT’s $100K business plan competition, which galvanized current students at MIT to think about startups, and created a movement which spread to many other universities. He also helped create TechLink, a group that organizes mixers between different departments at MIT, and which helped MIT become a better collaborating university at the student level. Desh Deshpande created the Deshpande Center for Technological Innovation at MIT, getting capital and help to individuals with exceptional nascent ideas. The British Consulate, and later and on a grander scale, Microsoft, opened beautiful meeting facilities next to MIT where networking groups were welcome to hold their events. Jeff Bussgang and his colleagues at Flybridge Capital Partners created Stay In MA, which helps students cover the costs of attending local professional conferences. Some of us are working on a project called Venture Café, which seeks to create a different type of ‘center’ in the center of Kendall Square.
Coming back to Scott’s blog post, I don’t believe it matters if you are a VC in Boston, Cambridge, or Waltham, or if you are a company, a city government, a university, or simply an individual who cares about innovation. The way to matter is to contribute to building and strengthening your community in the ways you can. Pick an initiative and run with it. If it doesn’t work, try something else. You will make a difference, and at the very least, perhaps Scott Kirsner won’t get on your case.