If luck favors the prepared mind, as Louis Pasteur is credited with saying, we’re in danger of becoming a very unlucky nation. Little of the material taught in schools today is relevant to the future. Consider all the science and economics that has been updated, the shifting theories of psychology, the programming languages, political theories, and even how many planets our solar system has. Much, like literature and history, should be evaluated against updated, relevant priorities in the 21st century. So, what can we “teach” our students to prepare them for the future?

1. The fundamental tools of learning and analysis, as well as basic concepts

2. Knowledge of a few generally applicable topics

3. The skills to “dig deep” into their areas of interest in order to understand how these tools can be applied to one domain and to be equipped to change domains every so often

4. Preparation for jobs in a competitive and evolving global economy

5. Preparation to continuously evolve and stay current as informed and intelligent citizens of a democracy

To me, the fundamental tools of learning stem (no pun intended) from science, technology, engineering, and math. This updated curriculum should eclipse the archaic view of liberal education still favored by institutions like Harvard and Yale based on a worldview from the 1800s. Critical subject matter should include economics, statistics, mathematics, logic and systems modeling, current (not historical) cultural evolution, psychology, and computer programming. Furthermore, certain humanities disciplines such as literature and history should become optional subjects, in much the same way as physics is today (and, of course, I advocate mandatory physics study).

Finally, English and social studies should be replaced with the scientific process, critical thinking, rhetoric, and analysis of current news—imagine a required course each semester where every student is asked to analyze and debate topics from every issue of a broad publication such as The Economist, Scientific American, or Technology Review. Such a curriculum would not only provide a platform for understanding in a more relevant context how the physical, political, cultural and technical worlds function, but would also impart instincts for interpreting the world, and prepare students to become active participants in the economy. After all, what is the job of education?

Should we teach our students what we already know, or prepare them to discover more? Memorizing the Gettysburg address is admirable but ultimately worthless; understanding history is interesting, but not as relevant as topics from the Economist; a student who can apply the scientific process or employ critical thinking skills to solve a big problem has the potential to change the world or at least get a better-paying job. No wonder half the college graduates who fill jobs actually fill jobs that don’t need a college degree! Their degree is not relevant to adding value to an employer. Often, in my view, it is even less relevant to being an intelligent voter in a democratic economy. Most graduates cannot read the Economist and separate “facts,” “assumptions by the writer,” “biases,” “projections,” or “conclusions and their validity” in a critical way.

I’d also suggest tackling several general and currently relevant topic areas such as genetics, computer science, systems modeling, econometrics, linguistics modeling, traditional and behavioral economics, and bioinformatics (not an exhaustive list). Not only do these topics expose students to a lot of useful and current information, theories, and algorithms, they may in fact become platforms to teach the scientific process—a process that applies to (and is desperately needed for) logical discourse as much as it applies to science, and of much future learning in general. Even if the specific information becomes irrelevant within a decade (who knows where technology will head next; Facebook, Twitter, and the iPhone didn’t exist in 2004, after all), it’s incredibly useful to understand the current frontiers of science and technology as building blocks for the future, more so than understanding history or Kafka.

If we had enough time in school, I would suggest we do everything. Sadly that is not realistic, so we need a prioritized list of basic requirements because every subject we do cover excludes some other subject given the fixed time we have available. We must decide what is better taught during the limited teaching time we have, and what subjects are easier learnt during personal time or as post-education pursuits. For instance, passions like music and its history may be best left to self-pursuit, while exploring the structure and theory of music may be a way to teach critical tools!

For some small subset of the student body, pursuing passions and developing skills in subjects such as music or sports can be valuable, and I am a fan of schools like Juilliard, but in my view this must be in addition to a required general education. It’s the lack of balance in general education which I am suggesting needs to be addressed. Setting music and sports aside, with the critical thinking tools and exposure to the up-and-coming areas mentioned above, students should be positioned to discover their first passion and begin to understand themselves, or at the least be able to keep up with the changes to come, get (and maintain) productive jobs, and be intelligent citizens.

After grasping the fundamental tools of learning and some broad topical exposure, it’s valuable to “dig deep” in one or two topic areas of interest. For this, I prefer some subject in science or engineering rather than literature or history (bear with me; I’ll explain in a minute). Obviously, it’s best if students are passionate about a specific topic, but it’s not critical as the passion may develop as they dig in (some students will have passions, but many won’t have any at all). The real value for digging deep is to learn how to dig in; it serves a person for the duration of their life: in school, work, and leisure.

If students choose options from traditional liberal-education subjects, they should be taught in the context of the critical tools mentioned above. If students want jobs, they should be taught skills where future jobs will exist. If we want them as intelligent citizens, we need to have them understand critical thinking, statistics, economics, how to interpret technology and science developments, and how global game theory applies to local interests. Traditional international relations and political science are passé as base skills and can easily be acquired once a student has the basic tools of understanding.

Back to history and literature for a moment; these are great to wrestle with once a student has learned to think critically. My contention is not that these subjects are unimportant, but rather that they are not basic or broad enough “tools for developing learning skills” as they were in the 1800s, because the set of skills needed today has changed. Furthermore, they are topics easily learned by someone trained in the basic disciplines of thinking and learning that I’ve defined above: this isn’t as easy the other way around. A scientist can more easily become a philosopher or writer than a writer can become a scientist.

Besides, physics is a much more important tool to understand the science and technology that drives modern life than history is, not to mention that it’s far more useful in helping someone understand how her car or refrigerator works. This makes it all the more concerning that many states don’t require physics to graduate from high school but do require many years of history classes—a lopsided and poor use of student time. University education continues this tradition, especially as students flock to the “easier/less work” courses. If subjects like history and literature are focused on too early, it is easy for someone not to learn to think for themselves and not to question assumptions, conclusions, and expert philosophies—this can actually do a lot of damage. On the other hand, with the right critical lens, history, philosophy, and literature can help creativity and breadth by opening the mind to new perspectives and ideas. Still, learning about them is secondary to learning the tools of learning.

In the end, school is a place where every kid should have the opportunity to become a potential participant in whatever they might want to tackle in the future, with an appropriate focus not only on what they want to pursue but also, pragmatically, what they will need to do to be productively employed. By embracing thinking and learning skills, and adding a dash of irreverence and confidence that comes from being able to tackle new arenas (creative writing may have a role here, but Jane Austen does not make my priority list), hopefully they will be lucky enough to help shape the next few decades or at least be intelligent voters in a democracy and productive participants in their jobs. At the very least they should be able to evaluate how much confidence to place in a New York Times study of 11 patients on a new cancer treatment from Mexico or a health supplement from China and to assess the study’s statistical validity and whether the treatment’s economics make sense. And they should understand the relationship between taxes, spending, balanced budgets, and growth better than they understand 15th century English history.

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The world is only going to become more technological and more global in the next decade. Students should be getting a solid enough grounding in mathematics, probabilistic thinking, physics, chemistry, biology, and engineering that they understand these ways of thinking and the values of these fields. They also need a liberal arts grounding and, particularly, well developed verbal and writing skills.

Finally, they need enough experience with the rest of the world that they are comfortable interacting with people who come from different cultures and in foreign venues. A foreign language is often a very valuable asset and for people who have backgrounds in multiple cultures—learning the languages of their parents can be an extremely effective preparation for a global career.

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I think learning the fundamentals of a discipline is the most important thing that students can do to prepare themselves for jobs both today and tomorrow. That discipline may be biology, bioengineering, chemistry, chemical engineering or others. I also think doing research is great preparatory experience. Furthermore, I believe the opportunities offered by the convergence between biology, medicine, and engineering are rapidly increasing.

Thus, courses and research at this interface may be increasingly attractive. At MIT, for example, training at the Koch Institute for Integrative Cancer Research or the Broad Institute or the Harvard-MIT Health Sciences and Technology Program may be very helpful. At many universities, there are also special programs or activities that students can be involved in that may be useful. At MIT such programs include the $100K business plan competition. At Stanford they have a Biodesign Program. Finally, summer jobs in companies involved in biotech or pharma or medical devices can offer great experiences.

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Liberal science and technology. We need a new major that prepares the future workforce for constant change by teaching broad-based knowledge in many disciplines. This major would consist of, among other disciplines, the basics of engineering, biology, chemistry, physics, law, business, humanities and communications. This curriculum should be group-based, where students teach each other, which is how the most successful corporate teams function—from design to product launch. The rate of change will demand workers who can easily recognize and accept the rapid evolution of science and technology.

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Some big-company-related news to report in the Boston area. Let’s get right to it.

—Microsoft Research New England has made three new hires in its social media research group, joining danah boyd. They are professors Nancy Baym from the University of Kansas (specializing in personal connections and online communities); Kate Crawford from the University of New South Wales (mobile media and youth culture); and Mary Gray from Indiana University (youth sexuality and digital media).

—Speaking of Microsoft (NASDAQ: MSFT), the software giant is working with Ford Motor Company (NYSE: F), Watertown, MA-based BlueMetal Architects, and Boston mobile-health firm Healthrageous to do research on extending health management to people’s vehicles. The companies are building a prototype system that collects biometric data and sensory information from a car that can be uploaded to a person’s health and wellness database.

—PayPal, the subsidiary of eBay (NASDAQ: EBAY), is looking to add staff in the Boston area, according to a report by the Boston Globe’s Scott Kirsner. The report says Scott Thompson, formerly president of PayPal and incoming CEO of Yahoo (NASDAQ: YHOO), visited Boston last fall to discuss PayPal’s expansion in the area. PayPal, which may or may not get spun out by eBay (I’ve heard rumors), acquired Boston mobile firms Where and Fig Card last year. Thompson, a Raynham, MA, native and Stonehill College alum, was also a board member of Vertica, the Boston-area big-data company acquired by HP (NYSE: HPQ) last year.

—My colleague Curt Woodward spoke with Facebook engineering director Jay Parikh about the social network’s ongoing upgrades to its technical infrastructure. If his name sounds familiar, that’s because Parikh is an eight-year-plus veteran of Cambridge, MA-based Akamai (NASDAQ: AKAM). He served as a vice president of engineering for the Web content-delivery firm from 1999-2007. No word on why Facebook hasn’t set up an engineering center in Boston yet.

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According to the National Science Foundation, eighth grade girls are half as likely to be interested in science, technology, engineering and math (STEM) careers as boys—a dramatic change from second grade, where the numbers are roughly equal. This trend continues through high school, college and into the workplace, as even women with advanced science degrees tend to leave the field at higher rates than their male counterparts. The numbers also show that careers of men and women in bioscience progress at markedly different rates; while women and men each hold about half of the graduate degrees in biology, far more senior leadership roles are held by men than women (17 percent vs. 83 percent, respectively.)

Women In Bio Greater Boston (WIB-GB) is one group that is trying to change that. It is the newest chapter of a fast-growing international trade association aimed at fostering leadership, entrepreneurship and careers of women in the biosciences. Comprised of professionals across the career continuum—from those just starting out to industry veterans—the group plans to leverage the region’s strong biotechnology supercluster to provide career development opportunities for women in New England. Programming being planned for 2012 includes networking, mentoring and educational events specifically geared at the interests of and challenges faced by women working in this industry.

Similar WIB chapters in Washington, DC/Baltimore, Research Triangle Park, Seattle and Chicago are enjoying enthusiastic participation in both social and career-enhancing programs, such as an expert lecture on IP in Chicago and a national team entry in the Walk for the Cure in DC. In addition, Washington/Baltimore, RTP, and now Boston have organized a special series aimed at young girls interested in science, called Young Women In Bio (YWIB).

As part of the YWIB series, Biogen Idec opened its doors as host to 25 curious middle school girls from across Massachusetts on December 1. It was an educational, fun program designed to provide the students with first-hand knowledge of the biotechnology and life sciences industry. Nadine Cohen, Biogen’s senior vice president of regulatory affairs, provided a welcome and an overview of the company, biotechnology, and the field’s range of career paths. Community lab director Tracy Callahan, and lab manager Jennifer Greenberg took the visitors on a site tour, engaged them in a hands-on lab experiment (involving M&Ms!), and visited the purification lab to share information about the crucial assays used in biotechnology. A shadow experience demonstrated a “day in the life” of several Biogen employees. Scientist mentors led the visitors to their individual work areas as they explained their roles, shared how they became interested in science, displayed and explained a variety of lab equipment, and answered insightful questions from the inquisitive young ladies.

Lisa Geller, program chair of the Women in Bio Greater Boston chapter, explained why the group is spearheading these events. “As successful women who are passionate about working in the biotechnology industry, we hope to fuel a similar interest in the next generation of female scientists and business leaders. We hope that our Young Women In Bio program blossoms into an ongoing series for girls from early middle school into high school to continue keep them interested as they get older.”

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I guess Werner Vogels changed his mind. Amazon.com’s chief technology officer told me a couple years ago that his company had no intention of opening a Boston office. MIT engineers, he said, had no problem moving out west to Seattle to join the e-retail technology giant. I thought that was kind of strange, but Amazon has always done things its own way.

Now it appears the company (NASDAQ: AMZN) is about to establish a beachhead in Cambridge, MA. According to a report by Scott Kirsner in Boston.com, Amazon is in the process of hiring engineering and research talent and is looking for about 40,000 square feet of office space in the Kendall Square area, slated to open in February. The company has not confirmed any of this publicly, and will probably try to keep it quiet as long as it can. Kirsner speculates that the timing might have to do with changes in sales tax laws.

We’ll have more on this developing story as details surface. If the report is accurate, the impact on the Boston area, and Kendall Square in particular, could be really significant.

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In her work at the University of Washington, Yoky Matsuoka spends time figuring out how to make the brain work directly with machines. In her startup work, she’s targeting something a lot less fancy-sounding: the home thermostat.

Matsuoka is vice president of technology at Nest, a Palo Alto, CA-based startup aiming to tackle energy efficiency by giving the ubiquitous wall-mounted thermostat a major overhaul. Nest’s device, detailed in these stories from The New York Times, Wired, and Forbes, adapts to its owners’ habits by tracking how they adjust their heat. It also uses motion sensors to detect whether anyone’s home, and gives owners data to track their energy use over time.

One passage from the Wired piece sheds some light on interesting adjustments that Matsuoka had to make to the device’s algorithms after testing with users.

It turned out that the Nest thermostat was actually being too aggressive in controlling the temperature for energy efficiency when nobody was home, making people feel like they were being forced into greener behavior rather than nudged.

“We’re actually trying to change the culture,” Matsuoka says. “If we just put a machine-learning device in people’s homes that changes the temperature without people understanding how it works, it’s never going to take off. We really had to understand how humans learn to live with a brand-new system.”

Nest’s co-founders led crucial work on the iPod and iPhone before starting Nest. Matsuoka, who was a 2007 MacArthur genius grant winner, also is a former head of innovation at Google. She’s on leave from the UW while working at Nest.

The startup is backed by top venture firms, including Kleiner Perkins Caufield & Byers, Google Ventures, and Lightspeed Ventures. Today’s reports say the company has raised in the neighborhood of $50 million.

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Wayne State University announced last week that it has received a $1.7 million grant from the National Institute on Minority Health and Health Disparities of the National Institutes of Health to increase the interest of metro Detroit girls in health-related “STEM” disciplines—science, technology, engineering, and mathematics.

Sally K. Roberts, faculty adviser for WSU’s Gaining Options-Girls Investigate Real Life (GO-GIRL) program, will oversee the program, which aims to reach female students in grades 8 through 12 with summer academies, academic-year chats over refreshments for girls and parents, and continuous mentoring support by WSU undergraduate women students through social networking sites and other technology.

Roberts says the girls will use iPods while the mentors use iPads to communicate throughout the school year using a “Twitteresque” texting tool. Mentors will use the texts to portray their lives as science students, posting status updates when they’ve learned something new and exciting or even when they’re doing something mundane like studying.

“Most of it will be closed discussions, but there will be some crossover into platforms like Facebook,” Roberts adds. “Even though we hear from the girls that it’s becoming less cool, it still suits our purposes. Little girls seem to want to be rock stars or doctors. We’d like to expose them to the broad spectrum of health and science jobs in between.”

Participation in the newly funded program will be dependent on the students’ previous participation in GO-GIRL as a 7th grader. Organizers say more than 600 adolescent girls have participated in the GO-GIRL program since it was originally funded through a grant from the National Science Foundation in 2002. Last semester, girls from 57 middle schools and 22 communities in metro Detroit took part in programs such as “GO-GIRL Nano” and GO-GIRL Cyber.” Though demographics vary from year to year, Roberts notes most of the girls in the program are African-American—an underrepresented voice that is vital to include in health-related STEM fields.

“So many programs get kids excited but then kind of disappear,” Roberts says. “We hope, though social media and face-to-face contact, that we’ll keep them engaged. We cheerlead so they continue to make good choices and no doors are closed on them.”

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We’re quickly moving to a new world where the wealth gap is compounding and increasing. We’re moving to a world that is going to look a lot like Hollywood: a few people enjoying insane success … and everyone else spends their days waiting tables.

The delta between A-players and B-players in companies has always been high. A-players get promoted faster and they earn more. My guess is that an A-player earns about 30 percent more than a B-player in that same position for most professions. An A-player administrative assistant usually can earn about 30 percent more than a B-player in the same position. That’s a significant difference and even more when you compound that difference in savings and lifestyle over the course of one’s career.

In some professions like sales and entertainment, an A-player might earn 300 percent more than a B-player and essentially live an entirely different lifestyle. In the future, everyone’s jobs will look more like salespeople.

Let’s focus on the profession I am most familiar with: software engineers.

Today, an A-player software engineer has a lot more job prospects than a B-player. That seems obvious. But there are plenty of B-player and C-player engineers that work at great companies and get paid well. Their services are needed and important. And while they don’t make the contributions that an A-player makes, they still are very valuable to a company and have a lot of importance to the success of an organization.

But things are changing (queue in the Darth Vader music).

There are three forces that will drastically change work, compensation, and our value to each other forever:

1. A productivity boom will automate B- and C-player work.
2. Globalization will commoditize B- and C-player work.
3. A-players can have much more impact.

The productivity boom will automate your job.

Everyone is massively more productive today than they were just a few years ago. A salesperson can use tools like Salesforce.com to track customers, LinkedIn to find prospects, and they can easily call and send documents from the road with their iPhones (unless they are on AT&T). The Internet makes all of us extremely productive and automates parts of our jobs.

In the 1990s, I was a software developer and I remember writing a script to determine if a string was a valid e-mail address. It took about 12 hours for me to write. First, I had to research what could and could not be in an e-mail address (dashes are ok, commas are not, only one “@” symbol, etc.) and there were a bunch of corner cases that I had to guard against and test against. After coding into the night, I finally came up with something I was proud of.

Today those 12 hours of work would take about 1.2 seconds. There are hundreds of libraries that have been written by really smart people and tested by thousands of programs. All one has to do is … Next Page »

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There’s something about Estonia. Maybe it’s the Skype phenomenon—the Estonian-born company (now part of Microsoft) certainly helped create a strong culture of engineering there. But the Baltic nation of 1.4 million seems to have a greater concentration of engineers and technical talent than almost anyplace else.

That’s probably an exaggeration, but at least one recent Boston-area company hails from there—GrabCAD, a nine-person startup that graduated from the TechStars Boston incubator program in June. If all goes well, the company, which splits its staff between Cambridge, MA, and Tallinn (the Estonian capital), will do its part to advance a traditional strength of the local tech scene. That would be computer-aided design, or CAD software, the means by which most technical components we take for granted are designed and built—and the basis of iconic companies like Parametric Technology (PTC), SolidWorks/Dassault Systèmes, and Autodesk.

GrabCAD has built an online community and marketplace that connects mechanical engineers with people and companies who need stuff built—everything from auto parts and motorcycles to custom furniture, toys, and mobile devices. The startup provides a Facebook-style feed where users can see other engineers coming online, uploading their designs, and looking for business. That also means the company is accumulating a large library of CAD models and tutorials that engineers and companies can use as a resource, says co-founder and CEO Hardi Meybaum.

Last week, GrabCAD unveiled a new dimension to its offerings. It is letting companies host their own design contests to take on specific engineering challenges, such as building a new ventilation system for a luxury yacht or designing a new kind of electrical “superbike.” Engineers upload their designs in response, and the companies choose the winners and award them cash prizes.

Meybaum, 29, and his co-founder Indrek Narusk—they went to Tallinn University of Technology together—started working on a product development company back in 2007. They got some customers, but they found running the business took too much of their creative time.

Around 2009, when GrabCAD started working on its current idea, the founders “didn’t meet anyone who said it’s going to work,” Meybaum says. People thought (and still think) the company would get besieged by orders for impossibly complex designs like rockets, for example. But in fact its first order … Next Page »

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At first glance, the nondescript office park at 800 Republic Drive in Allen Park, MI, is notable only for being situated next to the Detroit Lions’ practice facility. That’s set to change on Nov. 18, when the building will be transformed into TechShop Detroit, a joint project between Ford and TechShop, the DIY communal fabrication studio where everyone from garage-workshop tinkerers to tech-savvy rocket scientists can come and create their own homegrown inventions.

Ford is the first automaker to work with Menlo Park, CA-based TechShop, which operates a network of membership-based workshops similar to health clubs, except instead of getting access to treadmills and barbells, members who pay $100 per month can get their hands on 3D printers, laser cutters, industrial-grade sewing and textile equipment, vehicle bays, and virtually every kind of tool and software you can imagine. And the Detroit outpost of TechShop will be the first one to be paired with a facility geared toward helping TechShop members commercialize their inventions.

Imagination, says Jim Newton, TechShop’s founder and chairman, is the entire impetus for the operation.

“All we care about is that you have an idea, and our staff will help you turn that idea into a real, live thing,” Newton said at a press event today. “Our mission is not that big—we just want to usher in the next Industrial Revolution.”

TechShop Detroit will also help fuel a vision that Ford Global Technologies, the domestic auto industry’s only internal intellectual property management and licensing group, hopes to bring to life—a first-of-its-kind intellectual property exchange and technology showroom where everyday inventors, industry insiders, universities and research labs can display and even license their automotive innovations and other ideas.

“The showroom idea can be considered TechShop Plus,” said Bill Coughlin, president and CEO of Ford Global Technologies. “It will be an open meeting place that will enable inventors to showcase what they create in TechShop and then negotiate, network, and even sell their idea to players in the automotive industry, from manufacturers and suppliers to research institutions and startups.”

The innovation exchange, which will be housed in the Republic Drive facility alongside TechShop, will be managed by the Detroit-based AutoHarvest Foundation, a new nonprofit organization set up by auto executives to help connect the … Next Page »

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Scientists and engineers as founders and startup CEOs is one of the least celebrated contributions of Silicon Valley.

It might be its most important.

ESL, the first company I worked for in Silicon Valley, was founded by a PhD in math and six other scientists and engineers. Since it was my first job, I just took for granted that scientists and engineers started and ran companies. It took me a long time to realize that this was one of Silicon Valley’s best contributions to innovation.

Cold War Spinouts

In the 1950’s the groundwork for a culture and environment of entrepreneurship were taking shape on the east and west coasts of the United States. Each region had two of the finest research universities in the United States, including Stanford and MIT, which were building on the technology breakthroughs of World War II and graduating a generation of engineers into a consumer and cold war economy that seemed limitless. Each region already had the beginnings of a high-tech culture, Boston with Raytheon, Silicon Valley with Hewlett Packard.

However, the majority of engineers graduating from these schools went to work in existing companies. But in the mid 1950’s the culture around these two universities began to change.

Stanford—1950s Innovation

At Stanford, Dean of Engineering/Provost Fred Terman wanted companies outside of the university to take Stanford’s prototype microwave tubes and electronic intelligence systems and build production volumes for the military. While existing companies took some of the business, often it was a graduate student or professor who started a new company. The motivation in the mid 1950’s for these new startups was a crisis – we were in the midst of the cold war, and the United States military and intelligence agencies were rearming as fast as they could.

Why It’s “Silicon” Valley

In 1956 entrepreneurship as we know it would change forever. At the time it didn’t appear earthshaking or momentous. Shockley Semiconductor Laboratory, the first semiconductor company in the valley, set up shop in Mountain View. Fifteen months later eight of Shockley’s employees (three physicists, an electrical engineer, an industrial engineer, a mechanical engineer, a metallurgist and a physical chemist) founded Fairchild Semiconductor. (Every chip company in Silicon Valley can trace their lineage from Fairchild.)

The history of Fairchild was one of applied experimentation. It wasn’t pure research, but rather a culture of taking sufficient risks to get to market. It was learning, discovery, iteration and execution. The goal was commercial products, but as scientists and engineers the company’s founders realized that at times the cost of experimentation was failure. And just as they don’t punish failure in a research lab, they didn’t fire scientists whose experiments didn’t work. Instead the company built a culture where when you hit a wall, you backed up and tried a different path. (In 21st century parlance we say that innovation in the early semiconductor business was all about “pivoting” while aiming for salable products.)

The Fairchild approach would shape Silicon Valley’s entrepreneurial ethos: In startups, failure was treated as experience (until you ran out of money).

Scientists and Engineers as Founders

In the late 1950s Silicon Valley’s first three IPOs were companies that were founded and run by scientists and engineers: Varian (founded by Stanford engineering professors and graduate students), Hewlett Packard (founded by two Stanford engineering graduate students), and Ampex (founded by a mechanical/electrical engineer). While this signaled that investments in technology companies could be very lucrative, both Shockley and Fairchild could only be funded through corporate partners—there was no venture capital industry. But by the early 1960′s the tidal wave of semiconductor startup spinouts from Fairchild would find a valley with a growing number of U.S. government backed venture firms and limited partnerships.

A wave of innovation was about to meet a pile of risk capital.

For the next two decades venture capital invested in things that ran on electrons: hardware, software and silicon. Yet the companies were anomalies in the big picture in the U.S.—there were almost no MBAs. In 1960s and ‘70s few MBAs would give up a lucrative career in management, finance or Wall Street to join a bunch of technical lunatics. So the engineers taught themselves how to … Next Page »

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Cambridge, MA-based HubSpot, a marketing tech company, has acquired fellow Cambridge startup Performable, which focuses on marketing automation. Terms of the deal weren’t announced, but Performable’s 18-person team, including founder and CEO David Cancel, will join HubSpot (now more than 260 strong) at the latter company’s headquarters on First Street. Cancel will become HubSpot’s chief product officer.

The companies say the merger will help HubSpot enable its business customers to “turn more visitors into leads and customers.” Of course, HubSpot is also gaining top product development, user experience, and engineering talent from Performable. From the latter company’s point of view, becoming part of HubSpot should accelerate its drive to become a multi-billion-dollar business that transforms the marketing industry, Cancel said in a statement.

Back in March, HubSpot announced a $32 million Series D round led by Sequoia Capital, Google Ventures, and Salesforce.com. HubSpot CEO Brian Halligan told me then that his company was looking to make some acquisitions. Meanwhile, Performable, which was backed by Charles River Ventures, was looking to become the Salesforce.com of online marketing and automation, Cancel told me.

This is certainly a deal that has the tech community talking. We’ll have more on the story as further details emerge.

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James Hamilton is obsessed with efficiency. As vice president and distinguished engineer for Amazon Web Services, Hamilton is at the forefront of the Seattle company’s massive cloud computing effort, from software and switches to air conditioning and building design. Kind of fitting for a veteran of Microsoft and IBM who also used to fix high-end European sportscars—”and just to keep the bills paid, Fiats,” as he writes on his personal website.

Earlier this week, I dropped by an Amazon Technology Open House at the company’s new campus in Seattle’s South Lake Union neighborhood, as Hamilton told a roomful of people about the ways the AWS team is trying to wring efficiency out of data centers, where the rest of the industry is getting it wrong, and how big the company’s infrastructure growth looks. Here’s a link to the short deck of slides from his presentation.

Hamilton gave a fascinating idea of the scale and speed in play. As a point of comparison, Hamilton said he wanted to see how often the company adds the amount of computer capacity needed to run Amazon.com (NASDAQ: AMZN) back in the year 2000—as Hamiton pointed out, about a $2.7 billion company.

“I thought, I bet you I know how fast we’re growing right now. I bet you we bring on enough capacity to build a new Amazon every, say, three to four weeks. We went through the history, we dug through it, and found out, God—we do that every day. Every day, we bring on enough new capacity to support all of Amazon as a $2.7 billion company. Tomorrow, we’ll do the same thing again, and by the end of the week, we’ll have brought on the equivalent of five Amazons, $2.7 billion e-commerce companies—fairly big IT infrastructure at that time.”

That mind-boggling scale gets to Hamilton’s overall point, which was that the past five years have seen more data center innovation than in the previous 15 years. A major reason, of course, is that you now have enormous businesses like Amazon Web Services whose entire focus is finding infrastructure improvements—much different than when the work was an add-on at some other company specializing in a completely different business. Those people would never hire server designers or people specializing in power distribution. But for something like AWS, “the only thing that matters is the efficiency in the infrastructure.”

“The difference between AWS being a very, very boring business, possibly even a money-loser, and a phenomenally successful business that is able to reinvest back into the business, reinvest back into growth, reduce prices 11 times in four years—what makes that possible is the cost of the infrastructure,” Hamilton said. “That’s really the dominant cost. Research and development—it matters, but it’s the infrastructure cost that’s more relevant. When you make that problem job one, what happens is, you start to see some innovation.”

One of the foundational points Hamilton made was that servers are by far the largest cost in data centers. That seemed logical to me as an outsider, but he said that actually counters some conventional wisdom in the IT industry, where buildings, power, and staff sometimes get a lot of emphasis.

Hamilton puts the whole thing in perspective with a slide from his presentation called “Where does the money go?” that includes the pie chart displayed here, slicing up estimated costs for a hypothetical no-name data center of about 50,000 servers. The chart is from this page at Hamilton’s blog, which includes a detailed explanation of how he arrived at the estimates for his model data center.

Hamiton said these calculations show a couple of interesting points. First of all, a really popular type of server in the industry right now is a more expensive model that can pack data more densely, saving expensive building space for IT managers.

“They’re very focused on, ‘Hey, if I can spend more on the server but I can get a little more density, it’s a great thing.’ And you look at this chart and say, well, wait a second, wait a second—the number one cost, the dominant cost is the cost of the servers and storage,” Hamilton said. “So almost certainly … Next Page »

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Sometimes biotech really feels like an industry in danger of being left behind.

Take last Friday afternoon for example. I was at a networking reception at the University of Washington, chatting with undergraduates from all kinds of engineering fields about the job market. People were finding jobs, but nothing much to brag about, until I bumped into a couple of juniors majoring in computer science. They were marveling about their good luck, telling me stories that sounded like something out of 1999.

Campus legend has it that one computer science student at UW recently secured a $100,000 annual starting salary, a $40,000 signing bonus, and about $200,000 worth of stock from Google. The average computer science undergraduate is said to be getting about $85K to start. Word is that all computer science seniors have job offers, and some have multiple offers from the likes of Google, Microsoft, Zynga, Facebook, Salesforce.com, and others, says Pratik Prasad, a UW junior. This is consistent with the stories I hear from tech CEOs in Seattle, who say they are engaged in trench warfare with rivals to get the best young science and engineering talent.

This has to sound like something from a galaxy far, far away to people in biotech. Big Pharma’s R&D engines are in such a state of crisis that some are publicly wondering whether pharma should quit doing R&D altogether. Smaller, supposedly more innovative biotech companies are starved for cash and running lean, relying on cheap outsourced labor every chance they get. Academic biology departments are feeling pressure from state and federal budget cuts. For those who stay in academia, good luck ever progressing beyond the starvation wages offered by the typical postdoctoral fellowship.

The sense I get from talking to biotech grad students is that while they love what they do, quite a few have serious doubts about their chosen career path. They clearly have nothing like the prospects of their friends across campus who might create the next killer app for the iPad. While many biotech company executives like to complain that it’s hard for them to find enough skilled labor, people with scientific and technical skills tell you a different story altogether about the life sciences job market, which was recently covered by the SF Public Press.

“There is a huge divide between engineering and life sciences,” says Matt O’Donnell, dean of the College of Engineering at UW, who oversees various disciplines like computer science & engineering, aerospace, electrical, mechanical, and bioengineering.

Matt O'Donnell

All of the young engineers get job offers, because their skills lead directly into product development that industry relies on, O’Donnell says. As for those studying the kinds of riskier, more exploratory fields that are the bedrock of modern biotech—things like molecular biology and genomics—students “have to work much harder” to find a job, O’Donnell says.

How weak is the demand for young biotechies? O’Donnell gave me a pretty sobering rundown on job placement stats on campus. The UW’s top-rated bioengineering department only takes about 50 to 60 new students per year, he says. The rule of thumb is that placement usually breaks down … Next Page »

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It’s pretty impressive what a couple of engineers have built here in the Back Bay. But truth be told, the engineers themselves aren’t all that impressed yet. That’s because they have their eyes on a bigger goal: running a billion-dollar e-commerce company.

I’m talking about Niraj Shah and Steve Conine, the co-founders of Boston-based CSN Stores, which just might be the world’s biggest online-only retailer focused on home goods. The company, which owns more than 200 websites including Cookware.com, Strollers.com, BedroomFurniture.com, Luggage.com, and EveryFaucet.com, is New England’s largest e-commerce firm, not counting big retail brands like Staples.

CSN Stores has gotten a fair bit of press lately—after years of no press—because of its strong revenue growth and bootstrapped culture. (The company has taken zero venture financing to date.) But its story also holds important lessons about navigating a very competitive market, using technology as a unique tool, and maintaining its culture through its growth. There are also a few rumors swirling around this company—about how it plans to rebrand itself with a more consumer-friendly name, and how it might be raising a growth financing round to go really big (more on those below).

The company started in 2002 and has been profitable basically since its inception. CSN Stores had $380 million in revenue in 2010—an increase of more than 50 percent over the previous year—and it is on pace to grow by about 50 percent again this year, Shah says. The firm just opened a new distribution and customer care center in Utah that will employ about 300 people, adding to the company’s headcount of some 750 worldwide. Shah, the firm’s CEO, says the firm will have more than 1,000 employees by year’s end.

An obvious parallel in terms of growth would be Amazon.com, the Seattle e-retail giant that started out as a bookseller. In fact, Shah says, “We’re Amazon for the home.” He notes that CSN has watched what Amazon has done in the areas of customer focus and user interfaces. But he’s also careful to point out the differences between the companies—a key one being CSN’s focus on home products and its “specialized supply chain” for items like furniture. By shipping directly from manufacturers, CSN has managed to offer a large selection without having to stock its own warehouses (at least up to now).

“We’re at a point in our life cycle, if we do it right, we should be able to grow consistently over the next [few] years,” says Conine, CSN’s chairman. “Look at how fast Amazon grew in the early years. We have the potential to do something similar, and to emerge as a new e-commerce brand.”

Indeed, if CSN gets really big, its main competition will come from … Next Page »

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Last weekend, FIRST (For Inspiration and Recognition of Science and Technology) held a Regional Robotics Competition for 53 teams at Boston University’s Agganis Arena. High school students were challenged with the opportunity to test themselves as engineers and problem solvers. The game, called LOGO Motion, pits alliances of three robots against each other and awards points for placing each balloon, which is in the shape of a triangle, circle, or square on an appropriate peg to form the FIRST logo.

Preliminary rounds are scheduled Thursday, which help get the robots fine-tuned and then certified by the judges. Friday and Saturday morning the teams run through qualifying rounds to determine seeding for the final alliance selection. I coached the Newton Ligerbots, FIRST Team 2877 (sponsored by PTC, Raytheon, Textron, and NDEP). The matches were very exciting, with the Ligerbots playing solid defense while their alliance partners scored, but the trio lost in the quarterfinal round.

FIRST is about more than drive-trains, chassis, elevators, mechanical-arms, electrical systems, and computer programs. Below are some of my other takeaways from the event:

—Challenges: It was hard for the students to assess the level of difficulty involved in the design and strategy of their solution to this year’s problem. Additionally, the team found it difficult to evaluate the time required to build, because of the snow days that forced us to have six days off. However, this is the reality of engineering and FIRST creates an environment that simulates what students will see at work.

—Lessons Learned: As our team ages (we are currently a third-year team) more responsibility for decision-making is passed from the coaches to the students. We have students writing grants, scheduling the season, maintaining our Web page, and managing the development of the robot’s components. This all requires a significant level of teamwork and communication.

We never stop trying to enhance our product, and we pass our knowledge on to help others. It becomes apparent that … Next Page »

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You can learn a lot from Wikipedia, despite all its faults—and Jeff Catlin’s company has done just that.

Boston-based Lexalytics said today that its latest text-analysis software incorporates insights from combing through Wikipedia’s entire user-generated online encyclopedia for relationships between words, phrases, and their meanings. The company says its new software, which powers products used by big brands and other organizations to quantify the meaning and sentiment behind conversations on the Web, will be available this summer.

Before diving into the technology, here are some business metrics. Lexalytics is “quite profitable this year,” according to Catlin, the firm’s CEO. It saw 65 percent revenue growth last year, and is continuing to grow in 2011 in a number of new markets, he says (more on that in a minute). The company currently has 18 employees in the U.S. and U.K. Catlin himself splits time between offices in Boston and Amherst, MA.

About a year ago, my colleague Wade profiled Lexalytics and its humble beginnings in 2003, when Catlin was running an engineering group at LightSpeed Software, a Woburn, MA-based content management startup. LightSpeed was consolidating and closing its East Coast operation, but Catlin convinced the firm’s investors to let him run his division as a separate company (which became Lexalytics).

Lexalytics has gone on to provide “sentiment analysis” technology for companies that help brands and organizations monitor and manage their reputations online, such as Cymfony, ScoutLabs, and social-media firms like Bit.ly. Lexalytics recently landed Newton, MA-based TripAdvisor as a customer and partner; TripAdvisor (which is being spun out of Expedia as a separate public company) uses Lexalytics’ software to understand user sentiment—what people like and don’t like—in their online reviews of hotels, restaurants, cruises, and other attractions.

But the opportunity for Lexalytics goes far beyond understanding sentiment in blogs, tweets, and other social media. As I see it, the technology is really about getting a computer to understand the meaning of sentences and the deeper relationships between words and phrases in documents. So it’s about classifying “wonderful day” as positive and “horrible disaster” as negative, sure, but it’s also about identifying names and acronyms; detecting sarcasm or hype amidst praise or insults; and being able to classify things like “cabin” as a type of room on a ship, “chicken tikka masala” as Indian food, “golf club” as having to do with outdoor recreation, and “Red Sox” as a (currently bad) baseball team.

The technologies behind such “semantic” analysis of text—natural language processing, machine learning, and statistical modeling techniques—have been around for more than a decade. But they have continued to improve in recent years, enhanced in part by the availability of big, user-generated databases, like Wikipedia. And, crucially, the market for these … Next Page »

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Fifty-three teams battled it out on Saturday at the Boston regional edition of the FIRST (For Inspiration and Recognition of Science and Technology) Robotics Competition, a robot-building contest for high school students celebrating its 20th anniversary season year. The nonprofit behind the competition was founded by Segway inventor Dean Kamen.

Each year, student teams get a robot parts kit and a fixed amount of time before the showdown to build their machines. The robots are built to compete in a game created by FIRST that often contain elements of other sports like basketball (2009′s games) and soccer (last year’s competition). In this year’s game, “Logo Motion,” the robots earned points for student teams by hanging as many triangle, square, and circle balloon pieces in the playing field as possible, with bonus points going to the robot that could hang the pieces to form the FIRST logo. Student teams had the chance to score additional points by  designing and building a “mini-bot” that could race to the top of a vertical pole. Three robots and high school teams partnered on each side (a “coopetition”), as part of FIRST’s mission of fostering both a sense of healthy competition and teamwork.

Below is a list of the winners who will be competing in the FIRST championships in St. Louis, MO, later this month. Full details can be found here

Winner  1—Team 88, Bridgewater, MA
Winner 2—Team 1099, Brookfield, CT
Winner 3—Team 78, Newport County, RI
Engineering Inspiration Award winner—Team 1100, Northboro, MA
Rookie All Star Award winner—Team 3466, Westford, MA
Regional Chairman’s Award winner—Team 246, Boston, MA

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