On the Road with Intellectual Ventures’ Global Head of Technology, Patrick Ennis
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world and in the general business community.” About his visit to Tokyo, he says, “The western media portrays Japan as a relatively slow-growth economy. But some of the world’s best inventors are in Japan…Look at their tech companies and how they lead the industry.” Just because there isn’t a lot of VC and startup activity, he says, doesn’t mean there isn’t a lot of technology innovation going on.
On Singapore, Ennis points out it’s a small country, but it has a strong talent pool—and it also attracts “world-class innovators and scientists from other countries.” As compared with India, a very large country with an “incredibly dynamic environment for technology, one that’s come along through the years. The middle class has really mushroomed here. The breadth of technology they’re working on is really impressive. From a U.S. perspective, because so many technologists and entrepreneurs in the U.S. have ties to India, it makes it easier to do business.”
I had to ask Ennis which country’s food was his favorite so far. “It’s a running joke at IV,” he says. “I have the most bland palate, and I’m a real finicky eater. I’m sort of like the court jester of the team. I’m always looking for bread and white rice. We’ll go out to a really nice restaurant, and I’m begging the waiter to bring me some white rice. It makes it tough.” He says when they pass a McDonald’s, the others joke, “Take a picture, Patrick can eat there.” But seriously, he adds, “Singapore is really interesting because of the mix of cultures—it’s amazing the diversity of food you’ll get in one restaurant.”
Speaking of cultures, I asked how Intellectual Ventures is approaching its meetings as an outsider to the local communities. “The best way to be successful is to build long-term relationships and be seen as a long-term partner,” he says. But how do you build these relationships? “Get an introduction, if you can, from a trusted third party. ‘Here’s Patrick Ennis, he’s an Irish American you’ve never heard of, but I’ve known him for 15 years, and he’s a standup guy.’ Then a firm introduction, that’s even more important. ‘You’ve never heard of Intellectual Ventures, but we’ve worked with them.’ Second, take a long-term perspective and communicate that. At IV, we look at timeframes in decades. We’re not looking for quick deals, we’re looking to build a long-term, value-add relationship. That’s important—nobody wants a company if they’re there to make a quick profit. Also, don’t be viewed as just a U.S. company. Open a local office, and don’t just send some ex-pats. You need to hire people with deep ties and commitment to the region.”
Ennis also had some compelling thoughts on how the invention industry compares with the VC industry. “Venture capital is a mature industry. I view the next great challenge as invention. In VC, not only do you have to get the innovation right, but you have to get the team right, you take the market risk, the IPO risk, and you miss a lot of great inventions. You or I could have an invention in our basement to make oil refineries 4 percent more efficient. But can you and I do a startup [based on that]? No, you’ll get crushed with [only] a 4 percent efficiency gain. You need partners,” he says. “The media focuses more on venture capital, but as you know, venture capital is not appropriate for all inventions. If you look at a university tech transfer office, only a small number of inventions end up in a startup. Inventions come in all shapes and sizes. There are great big ideas and great little ideas. Great little ideas often sit on a shelf because the inventor may not have the expertise, money, or time to patent it or to find an operating company to produce and market that product.” Which is where Intellectual Ventures comes in. (Of course, IV also likes great big ideas, like new ways to combat global warming, hurricanes, and malaria, and new kinds of nuclear reactors.)
I asked Ennis for some parting thoughts on his firm’s global expansion. “All the countries we operate in, including the U.S., see innovation and intellectual property as being key to the future of their countries,” he says. Things like manufacturing and agriculture are still important, he adds, but “the only way to keep ahead of the curve” is to keep innovating. He points out that when you buy a computer, even if it was made overseas, nearly 100 percent of the profit goes to U.S. companies like Microsoft, Intel, or Apple. “They have the intellectual property,” he says. “The profit margin is really low for the hardware. Every country wants to change that and move up the value chain. And they’ll do it through innovation and invention.”