Less than three weeks ago, the Gary and Mary West foundation helped establish San Diego’s new West Wireless Health Institute, one of the first medical research organizations devoted to the development of new wireless healthcare technologies. As a result, in the not-too-distant-future, you could get a warning on your cell phone before you suffer a heart attack. You also will likely see your doctors less often and spend less time in the hospital. Yet, you will likely have more precise and immediate knowledge of your vital signs.

The key words that embody such advances are “remote monitoring.” Instead of seeing your doctor for a regular check up, you might simply wear different wireless sensing devices.

Gary West, who made his fortune in the telemarketing business, donated $45 million through his family foundation to create the institute in La Jolla. He also will serve as the institute’s founding chairman. According to West, a global search is underway for the institute’s CEO. He anticipates the institute will have approximately 25 employees by the end of the year, and more than 100 employees within the first eighteen months.

Gary West

West, who intends to make the institute fully operational by this summer, recently agreed to answer some questions from Xconomy.

Why did you get involved in launching this institute?

West: We want to be a catalyst for wireless health and provide optimism for the future of healthcare. I began to believe at least a decade ago that wireless technology could be the way to help accelerate change and improvement in healthcare. When you think about the reach of wireless technology and its ability to connect people, it isn’t hard to fathom that we can have that breakthrough impact on healthcare.

It was the connection with Dr. Eric Topol from Scripps Health and Don Jones from Qualcomm that solidified for me that this was the right thing to do at the right moment in time. Discussions between the three of us about launching the West Wireless Health Institute began …Next Page »

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Many of my friends and neighbors may have noticed that I haven’t been in town as much lately, and that I’m spending more and more of my time in Kansas City. So why would a hardened MIT denizen who used to think that distant travel meant going to Porter Square now be flying back and forth to Missouri every week?

It’s because the Ewing Marion Kauffman Foundation, which is headquartered in Kansas City, is pioneering new ways to advance our entrepreneurial economy. Kauffman’s president Carl Schramm inspired me the other day when he noted in a CNBC interview that all net job creation over the past thirty years has come from companies less than five years old. So what can we do to keep startups flourishing? I am delighted to be joining the Kauffman Foundation team as a senior fellow as we look out over the economic future and embark on a new approach for increasing both the number of new companies formed and the chances of success for these ventures.

This new initiative is called Kauffman Laboratories for Enterprise Creation. The mission of Kauffman Labs is to create more large-scale, high-growth firms. As someone with a combination of practical experience building companies, and academic experience teaching innovation and entrepreneurship at MIT—not to mention a passion for helping people build great companies—I’m very pleased to be a part of this initiative. It’s a perfect way to continue the work I started at MIT’s Deshpande Center for Technological Innovation.

Bad times are when good people spring into action. Today, more than ever, it’s important to catalyze and accelerate the tremendous inventive spirit of the American entrepreneur. As many have said before, we’ve got what it takes to innovate our way out of the current crisis.

Many budding entrepreneurs today face an unfortunate choice between going to school, or going to the school of hard knocks. In one circle, entrepreneurs can join MBA programs, fellowship programs, or business bootcamps. In another circle, they can dive in and get their hands dirty by starting a company, trying to raise venture capital or angel funding, or moving into an incubator. For the most part, these circles have not overlapped.

The idea behind Kauffman Labs is to create a new hybrid model. In the 2009 Kauffman Thoughtbook, the Foundation’s vice president of entrepreneurship, Bo Fishback, talks about the model of a conservatory, where students not only learn music theory but also play music. This is emphatically not the model most business schools follow today, as the New York Times noted in a well-reported March 15 article. B-schools are still trying to shake their legacy DNA of training the future CEOs of General Motors or the next generation of bankers and consultants. No self-respecting entrepreneur would think that he or she can learn how to run a startup by getting an MBA. Schools of Engineering are still struggling to understand their approach to teaching innovation, a discipline that runs contrary to traditional funding and tenure models.

Academic institutions, to be blunt about it, are the stodgy old incumbents in today’s innovation economy—and I say this as a faculty member at a school that is a hotbed of entrepreneurship. Don’t get me wrong—there are plenty of wonderful things that will always happen at MIT and could only happen at MIT. I am thrilled to continue my role at MIT in parallel with my Kauffman work. But there are many things that cannot happen within the walls of MIT, nor should they. I want to help make those boundaries easier to understand and navigate. It’s time for a disruptive new model, a hybrid between education and company creation.

Entities like Puretech Ventures, led by Daphne Zohar (an Xconomist like myself), are perfect examples of what we at the Kauffman Foundation would like to see more of. Puretech is not trying to be a classic life sciences venture capital firm, but is in the business of creating companies. That may include sprinkling in a little money, but it’s also about validating the science, identifying market needs, and building great leadership and advisory teams. Xconomy has already written about a new Kauffman program that will place “Entrepreneur Fellows” at Puretech and other organizations, and Lesa Mitchell, Kauffman’s vice president for advancing innovation, has spoken prolifically on this topic.

If you take the best of what entrepreneurs might get out of Puretech, the best they might get out of an MBA, and turbo-charge it by adding the best they might get out of accelerators and incubators like Y Combinator, TechStars, DreamIt Ventures, The Foundry, Bizdom U, or the Cambridge Innovation Center, that’s where we’re trying to go. If you connect all of these things through a coordinated mother ship, you get a new level of scale, quality, institutional memory, patience, and also a certain silo-busting neutrality. The Kauffman Foundation is in a unique position to make this happen.

There’s a movement in the philanthropic world to touch the people you’re trying to help directly, rather than giving money to others and hoping they will do it. By creating a new entity to focus on high-growth companies, the Kauffman Foundation will be going directly to the customer, and doing it with its talented people and its quality control. But we’ll also be practicing what we preach; we will be figuring out how to grow and create a high-scale model for fostering entrepreneurship as we go. As my mentor Desh Deshpande likes to say, this is a contact sport. Rather than developing a stagnant formal curriculum for an aspiring entrepreneur to be on the receiving end of, we want entrepreneurs to have a setting in which they can live the messy process and be able to draw on vital resources and kindred spirits. This involves getting in there and living the process with the entrepreneurs. It is real-time, iterative, and immerses us all in action-learning.

With the economy crippled, venture capitalists running from risk, and startup exit opportunities nonexistent (at least for the foreseeable future), somebody needs to create a new world order for high-growth companies. By weaving together many of the initiatives that the Kauffman Foundation already has underway—and building a few new ones from scratch—we will be following a natural progression. In short, we will create the sorts of companies that Mr. Kauffman wanted his foundation to spawn.

And that’s why I’m developing an appreciation for Kansas City, and why my wife is the one out walking our dog these days.

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Bill and Melinda Gates don’t give their money away to just anybody who comes along with an impressive resume and a good cause. So why has the world’s largest charitable foundation seen fit to give $1.3 billion of its fortune to a little-known Seattle-based nonprofit called PATH?

PATH, which has raked in the second-largest amount of Gates Foundation grants of any organization behind the vaccine group GAVI, is one of the biggest success stories of the Seattle innovation community in the past decade. Since CEO and president Chris Elias joined in September 2000, PATH has grown from 240 employees to 775. Its annual budget has soared from $41million to $240 million. It has formed partnerships with 60 biotech and pharmaceutical companies, and most public health bodies in the world that count, from the World Health Organization on down.

The organization, formerly known as the Program for Appropriate Technology in Health, sometimes struggles to explain what it does in a tight little Madison Avenue slogan. But essentially it seeks out clever, affordable technologies, and partnerships with clever entrepreneurs, to help improve the health of have-nots around the world. This vision plays itself out in a dizzying number of ways. PATH finances promising vaccine candidates, whether it’s for bird flu or other infectious bugs like pneumococcal disease that kills infants. It is working with entrepreneurs to develop fortified rice to so that people get more nutrition from a staple food. It is developing practical ways to purify water. It is helping ensure doctors get trained in a cheap, simple way to fix broken bones, so that people don’t languish in traction for months. It has pioneered the use of a sticker on vaccine vials that changes color if a vaccine goes bad. It serves as clearinghouse for the Gates Foundation-funded effort to eradicate malaria from the globe.

“We’ve really kind of grown up together with the Gates Foundation,” says Elias, whom I visited in his office. “We’ve grown dramatically.”

PATH got its start in Seattle in 1977 with a grant from the Ford Foundation to try to implement new contraceptive technologies that were developed for rich countries, but weren’t getting where they were needed in poor countries, Elias says. By about 1980, PATH’s founders realized that applying its model—of brokering deals between for-profit companies with innovative ideas and public health agencies with the means to get them to people in need—was a model that might work for expanding the use of diagnostics, drugs, devices, vaccines. Almost two-thirds of its budget comes from foundations, and the next biggest percentage, about 21 percent, comes from the U.S. government.

The people at PATH spend their time thinking about something most people in the U.S. are fortunate enough to never even consider—how to meet basic human health needs that the free market is unable to fulfill.

“The markets are very efficient ways of producing innovation where they work, where there’s a predictable demand and a system for delivery and financing. As imperfect as it is here in the U.S., that exists,” Elias says. “In poor countries, the market often fails. Either the market is unpredictable, or it’s not there. People are too poor. People who live on $1 a day can’t afford to buy products that will make anybody a significant margin.”

So there you have it, one of the world’s biggest fundamental problems, creating an enormous gap between haves and have-nots. Unsolvable, right?

They don’t seem to think so at PATH. In the face …Next Page »

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Elias Zerhouni, the former director of the National Institutes of Health during the Bush Administration, has joined the Bill & Melinda Gates Foundation as a senior fellow. Zerhouni, a world-class radiology researcher, will advise the foundation on its Grand Challenges in Global Health Initiative, in which the foundation works to identify the top scientific challenges in global health. One aspect of the effort is the foundation’s support for far-out ideas that are still too unproven to win traditional federal NIH grants.

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Peter Piot, the founding executive director of the Joint United Nations’ Program on HIV/AIDS, has joined the Bill & Melinda Gates Foundation as a senior fellow. He will advise the foundation on global health strategy, including the fight against HIV and other infectious diseases. The appointment will last only until May, when Piot will start a global health program at Imperial College in London, according to the Seattle P-I’s Tom Paulson.

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Lots of people put off giving to charity until the last couple days of the year when you can still get the tax deduction (including some of us here at Xconomy). We know this year has been rough, but for those of you who can still give, we put together a list of organizations that aim to strengthen the science and technology skills of young people in our region. It’s not a comprehensive list, so if you have any other suggestions, please post a comment below or send us a note at editors@xconomy.com

Technology Access Foundation (TAF)

—TAF aims to help children of color get the skills they need to join the high-tech workforce. Co-founder Trish Millines Dziko, a former Microsoftie, started this in 1996 as an after-school program to train kids for internships. That success paved the way for TAF’s most ambitious effort yet, a new public school it runs in Federal Way called TAF Academy High School. As we wrote back in September, Millines has a vision of enrolling 4,100 kids in TAF programs across the state by 2016.

Northwest Association for Biomedical Research

—Established in 1988, the Northwest Association for Biomedical Research, based in Seattle, runs programs to improve K-12 science education. It has longstanding programs to help train teachers in biology, as well as help match up students with career scientists who serve as mentors.

Pacific Science Center

—This hotspot at the Seattle Center for lifelong science, math, and technology learning serves a million people a year, and has educational programs that reach all 39 counties in Washington state.

Science & Engineering Business Association

—This student organization at the University of Washington aims to foster the entrepreneurial spirit in science and engineering students. It organized the largest career fair at the UW in October, with more than 140 companies scouting the talent pool.

Technology in Education Trust

—This charity is affiliated with the Seattle-based Technology Alliance, and is set up to support the organization’s public policy research and education outreach work.

Center for Inquiry Science

—This is a Seattle-based program established by the Institute for Systems Biology to improve K-12 science education in Washington state.

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As the holidays approach, the Cambridge, MA-based One Laptop Per Child Foundation (OLPC) has revived its Give One, Get One program, designed to encourage consumers in industrialized nations to buy the foundation’s XO laptops for schoolchildren in the developing world while also securing one for a child in their own family. The foundation, which is relying on Seattle-based Amazon to distribute the laptops this year, has also introduced “Give 100″ and “Give 1000″ programs that, for the first time, enable major donors to specify where they want laptops to be distributed—and it has commissioned a series of slick video advertisements to promote the giving programs.

Under the Give One, Get One (G1G1) program, consumers can buy two laptops for $399. One will be shipped to a school of OLPC’s choice, and the other to any recipient of the buyer’s choice. Part of the purchase price is tax-deductible—though OLPC says buyers should consult their accountants to figure out how much.

The Give 100 and Give 1000 programs are a bit different. By giving 100 or more laptops for $219 apiece, donors can direct which schools within OLPC’s partner countries or any of the world’s 50 least developed countries should receive the machines. By paying $259 per laptop, donors can have the machines sent anywhere in the world. New England Patriots quarterback Tom Brady announced in November that he is donating 1,500 XO laptops through the program for children in Uganda.

In an effort to grasp potential donors’ heartstrings, OLPC recently unveiled a series of video ads promoting the Give One, Get One program. One features an adorable African kid named Zimi who says: “I come from a place you’ve never heard of, a country that you can not pronounce, a continent you would rather forget. Our only problem is access to education, with education we will solve our own problems. To the person who gave me this XO laptop; thank you. You have changed my world.”

Another ad is slightly more controversial. As the alphabet song plays on a toy piano in the background, the video shows young children who have been recruited to labor as weavers, shoeshines, miners, sex workers, and maching-gun-toting soldiers. “Children are fast learners,” the ad says, as it closes on a scene of children using XO laptops in a sunlit classroom. “Let’s give them the right tools.” (We’ve embedded the ad below.)

To make sure that the second go-around of the Give One, Get One program goes more smoothly than the 2007-2008 version, when many orders were lost and some laptops were not delivered to purchasers until months after the holidays, OLPC recruited Amazon to handle online sales and fulfillment. Amazon’s G1G1 page says laptops are in stock and can be delivered by Christas Eve as long as they’re by Monday, December 22.

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The Bill & Melinda Gates Foundation has awarded a three-year, $7 million grant to the Seattle-based Infectious Disease Research Institute to develop improved ways to diagnose and care for patients in Africa infected with visceral leishmaniasis. The infection, caused by a parasite, affects about 500,000 people each year and is deadly in about one in 10 cases when it isn’t detected early enough, IDRI said in a statement.

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The Bill & Melinda Gates Foundation is planning to dole out less grant money in 2009 than anticipated, in response to the global financial crisis. The Seattle-based foundation, the world’s largest philanthropy devoted to global health, is still planning to spend 10 percent more on grants next year than in 2008, although that’s less than what it had previously budgeted, said CEO Jeff Raikes, in a letter on the foundation’s web site dated Nov. 21. The foundation’s grantmaking has been growing rapidly since 2006, when it received the first annual installment of stock donations from investor Warren Buffett. The donations were worth $1.6 billion in 2006, $1.76 billion the following year, and $1.8 billion this past July, according to the foundation’s web site.

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Get ‘em while they’re young. It’s true of the folks who market breakfast cereals, and also in the world of philanthropy.

The Fred Hutchinson Cancer Research Center has a reputation as a world-class research center, and it has no trouble enticing A-list Seattle businesspeople to join its board and open their checkbooks. Usually these people have reached the pinnacle of their careers, made a lot of money, and are in their 50s and 60s.

Now the “Hutch” is trying to recruit some of Seattle’s up-and-comers, under the age of 45, to start donating much earlier in life than they typically do. This effort, called the “Innovators Network,” is being spearheaded by Scott Hutchinson, 32, a commercial real estate developer who is the grandson of center founder William Hutchinson. The younger Hutchinson’s goal is to entice 100 young professionals to donate $1,000 each in the first year, and to ignite a long-term giving relationship with the center, Hutchinson says. The numbers are sketchy, but only a tiny fraction of donations to the center, something in the neighborhood of 1 percent, come from people in their 30s, he says.

“There’s great untapped potential in the community among young people,” Hutchinson says. “We needed something like this.”

The team at the Hutch has clearly done some homework on how to appeal to young donors. It is scheduling meetings between 4:30 pm and 7:30 pm, so as not to interfere with prime hours of the workday, or child-rearing responsibilities at night. It’s not overloading the calendar with events which would be hard for people to attend. A group of three or four scientists give 5-7 minute overviews of their research in a classroom format, and then plenty of time is leftover for one-on-one networking. “We have to make it fun, lighthearted,” Hutchinson says.

The pitch is all about directing small amounts of money in a way that they might have impact at a place with an annual budget of more than $300 million.

To convince young people to donate, the Innovators Network has decided to funnel its donations into the Hartwell Innovation Fund. It’s a pot of money that was started in 2001, through a $1 million grant from Microsoft’s Craig Mundie, to support ideas considered promising by a panel of distinguished scientists at the center, yet which haven’t produced enough proof of concept to qualify for grants from the National Institutes of Health. The Hartwell grants can be as little as $20,000, to pay for a few months of experiments, which could pay off and lead to bigger support from the NIH. The donations from members of the Innovators Network will also double their impact, because they are being matched by grants from the Geiger Family Foundation.

“Young people can relate to this idea, of the need to give people a chance,” Hutchinson says. He adds that getting the matching grant, and putting the money to work in small projects with big potential is key to their strategy of appealing to young people who want to get bang for the dollar.

The group’s first event, held in July, was expected to draw about 50 people, and ended up attracting double that, says Eileen Harasimowicz, a member of the center’s development staff. The Innovators Network is hosting its second event tonight at the center, and she was coy about attendance figures this time around. Word has gotten around, stemming from a panel of 16 volunteers, although she is starting to experiment with social networking sites like Facebook.

The computing tools may be different, but the concepts of networking aren’t much different from the 1960s and 1970s, when Hutchinson’s grandfather worked to get the center started. Hutchinson talked a bit about getting back to its roots, which is hard to do once an institution reaches the size of a place like the “Hutch.”

“It’s about getting out there at the grass roots,” Hutchinson says. “Thirty years ago, my grandfather was out there on the golf course, nudging his buddies, saying ‘You just sold a company, and you’ve got to give some money back.’ This isn’t really that different.”

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Software tycoon and San Diego Padres owner John Moores has contributed $2.1 million to kick off a $50 million fund-raising initiative for The Scripps Research Institute. The San Diego facility says the campaign is intended to expand current research programs and recruit elite scientists to the institute’s laboratories in San Diego and Jupiter, FL. Moores, who co-founded Houston’s BMC Software, started San Diego software investment specialist JMI Equity in 1992 and bought the Padres baseball team in 1994. He has served as a member of the Scripps Research Board of Trustees since 1997 and as chairman since 2006.

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What does the global health community in Washington need in order to firmly stake our claim as a world leader in this endeavor? That question will be a central topic next week when nearly 250 leaders from the Seattle area gather at Suncadia Resort in Cle Elum for the Seattle Chamber’s annual Regional Leadership Conference (Oct. 22-24). The focus of this year’s conference is global health research, innovation, distribution, and philanthropy.

The goal of the conference is to provide our regional leaders – including Senators Patty Murray and Maria Cantwell, who will be attending along with Gov. Christine Gregoire and Seattle Mayor Greg Nickels – with a clear understanding of the importance of the global health sector and the opportunities that it presents. And, we want to leave the conference with marching orders about what needs to be done to ensure our state as a center for excellence in global health.

The question of what the global health community needs has been considered for quite some time by me and my colleagues in the Washington Global Health Alliance. We have generated a framework with four major categories of what is required:

• Increasing marketing, outreach and recruitment activities
• Improving education, training and mentoring opportunities
• Enhancing infrastructure and incentives
• Creating public-private sector partnerships

Along with my colleagues Chris Elias of PATH, Judy Wasserheit of the University of Washington and Guy Palmer of Washington State University, I have been asked to address this issue head-on. The four of us will take part in a panel discussion to present our views and stir the creative juices of attendees with the intent of identifying the best ways to strengthen the global health enterprise in the state.

So what will I say? I will point out that Washington State global health community has made remarkable progress since the 1970s when I started Seattle Biomedical Research Institute. The well-developed health research community welcomed and embraced me, as well as my scientific goals, at a time when America was primarily focused on diseases that directly impacted this country. There was interest — but little research activity — in the global killers that were known at that time as “tropical diseases.”

That all changed with the multiple surges of emerging and re-emerging diseases, the HIV pandemic, the ability of many pathogens to resist common drugs, and economic globalization. As a consequence, awareness of the importance of what is now called “global health” has grown through the years. The fortunate presence of the Bill & Melinda Gates Foundation has further enhanced that awareness. In addition, Washington State possesses superb intellectual capital, the best technologies, and organizations that are committed to this sector. So we are well-positioned to work on developing new solutions to be delivered to improve global health. This has already had significant economic impact in our state – creating new jobs to expand the research infrastructure.

A key factor in this success is the tradition of cooperation and collaboration among the global health organizations, an element that I experienced so keenly when SBRI started. From its inception, SBRI collaborated with University of Washington research faculty and that cooperation was expanded when SBRI first became formally affiliated with the UW in the early 1990s.

SBRI also recognized that the mission of PATH — to deliver appropriate health technologies globally — complemented our mission of scientific discovery. SBRI and PATH shared space years ago, which both of our organizations outgrew. Our vision that SBRI’s discoveries would one day be delivered by PATH is now becoming a reality through our partnership within PATH’s Malaria Vaccine Initiative. SBRI will now be home to one of only four centers in the world that will test malaria vaccine candidates in humans. This cooperative tradition helped each of organization move forward both individually and collectively. And, it is a key advantage in competing with other states and regions.

But, what needs to be done to ensure that Seattle and Washington State remains a, if not the, leading center for global health research? …Next Page »

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Back in February I tried a million different ways to get Givvy founder John Treadway to tell me exactly what is was his months-old startup was building. The best I could get out of him at the time was something about online tools that give individual donors “more control and more empowerment over why, when, where, and how they give to charities,” and a lot of intriguing talk about the idea that people would feel better and give more if they were more able to ensure that their charitable spending aligned with their beliefs and priorities.

It wasn’t much, but it was enough to make me really wish I could play around with these tools and now I—and you—can do just that. The Framingham, MA-based startup debuted Givvy.com earlier this week in the DemoPit at the TechCrunch50 conference in San Francisco, and will be a “main dish” presenter next Monday at the Web Innovators Group meeting in Boston.

From what I’ve seen so far—and I’m still really just warming up the engine for my test drive of the system—Treadway and his crew have put together a nice set of Web 2.0-style features and tools while still keeping things fairly clean and approachable.

There’s a database of 1.4 million charities that you can search, browse by tags, and edit. (Can you imagine the edit wars likely to break out on the entries for, say PETA or the NRA?) There are simple tools for making one-time or scheduled donations to the charities you choose (donations are processed through the nonprofit Network for Good, which takes a 4.75% fee), and for recording donations you make outside of the Givvy system. You can get various reports on what you’ve given, including an end-of-year tally for tax purposes; network with other Givvy users; create virtual “funds” of charities around the causes that interest you or make donations to funds that other users have created; and so forth. There’s also a tool for creating a “Givving Plan” which aims to help you take stock of the causes you care about, how much you have to give, and plan your donations accordingly.

All of it is free to individual users, but Treadway says Givvy is developing a new subscription-based application on top of the existing system targeted at businesses.

Givvy is still very much in beta and I’ve run into a fair number of, let’s call them, quirks already—starting with a registration page that was reluctant to send me my activation e-mail. And I wonder how people will react to the social-networking aspects of the system. (Do most of us really want to publicly list all the places we put our charitable dollars, even if it is under a user name?) But I still think the main idea is a compelling one, and that Treadway’s arguments about the relationship between these kinds of tools and more thoughtful and generous giving could prove true.

Of course, as with any site or service that incorporates a lot of user-generated content and social networking features, Givvy will ultimately be only as good as the effort and thought that users put into it. And it’s still such early days (Treadway says there are only about a hundred users so far) that the site does feel awfully spare right now. The database entries for all the charities I’ve looked up so far, for instance, were bare-bones—none provided enough to base a giving decision on if you weren’t already familiar with the organization. But I think there’s reason to hope Givvy users will do the necessary pitching in to make the system a truly useful one—they are, by definition, a charitable bunch.

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Everybody can relax. Bono and Angelina Jolie won’t be here. At least not this year. But some of the biggest names in science, global health, and business will gather in Seattle today for the Pacific Health Summit, to brainstorm about the world’s thorniest emerging health problems.

Key decision makers from the Bill & Melinda Gates Foundation, the World Health Organization, and the U.K.’s Wellcome Trust (the world’s second-biggest health philanthropy behind you-know-who) will mingle with executives from Microsoft, Merck, and GE Healthcare, among others.

The summit’s founders, Nobel Laureate Lee Hartwell of the Fred Hutchinson Cancer Research Center and George Russell, the chairman emeritus of Russell Investments and creator of the Russell 2000 stock index, will be there too.

The conference, in its fourth year, is invitation-only and limited to about 250 people. Like the World Economic Forum held annually in Davos, Switzerland, it’s located in a setting with beautiful views of mountains and water, at the Bell Harbor Conference Center at Pier 66. The agenda is sprinkled with plenary sessions, small group talks, and time for one-on-one conversations.

It isn’t just all talk or wishful thinking. Last year, WHO director Margaret Chan outlined the threat of an avian flu pandemic, and London-based GlaxoSmithKline (the world’s second-largest drugmaker after Pfizer) listened, donating 50 million doses of vaccine for an emergency stockpile.

This year’s theme is about global malnutrition, basically what happens to public health when people eat too much cheap junk food with few nutrients, or not enough food with nutrients they need. As market forces lift millions out of poverty in places like China and India (a positive thing, obviously), many people are adopting the more sedentary Western lifestyle that leads to obesity and diabetes (a negative and very expensive problem).

If current economic growth trends continue in India, a country with more than 1 billion people, the demand for insulin for diabetics alone could be enough to swallow up the nation’s entire healthcare budget in 20 years, said Michael Birt, the summit’s executive director. Attendees want to brainstorm ways to harness market forces to prevent that from happening. They don’t want to be in the position of begging Eli Lilly or Novo Nordisk to donate insulin for needy diabetics. Summit attendees would rather find ways to invest in early childhood nutrition to prevent the problem in the first place, Birt said.

“We’re not just talking about sending a plane full of food over and thinking that will solve the problem,” Birt says. “Having a sustainable business is important. We want this to happen over decades.”

By getting the right people in the same room together—in a relaxed atmosphere, and at a moment in time when food prices are rising—the summit might just generate a few bright ideas.

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If you’re concerned about global warming, what breakfast cereal should you buy to support the company with the best record on greenhouse gas emissions? Soon, you might be able to make informed decisions on issues like that right in the supermarket aisle.

“All you’ll have to do is to take out your cell phone, scan the barcodes and you’ll get back a score, a rating, for the companies’ performance,” says Stéphane de Messières, executive director and founder of Citizens Market, an early stage non-profit organization based in Cambridge, MA.

The vision of Citizens Market is to create a platform where average consumers can share information on which companies are the most socially responsible. They’ll be able to write online reviews of companies and products and rate their performance, in the same way people contribute to consumer review sites like Yelp.

But instead of concentrating on value for the money in a limited sense, Citizens Market will focus on broader aspects of corporations’ behavior, like environmental performance, labor practices or political lobbying. The user community will also rate each other’s reviews, giving greater weight to those postings that are deemed the most reliable. The big idea is to enable consumers to put their money where their heart is, by supporting companies and products that are in line with their personal values and avoiding others. The information in the database will be reachable on the Web or, eventually, via a special cell phone interface customized for shopping.

For de Messières, the idea behind Citizens Market started several years ago with a pair of jeans.

“I wanted to buy a pair of blue jeans and searched for hours on the Internet and found a manufacturer in USA with a good record, with union-made jeans. I thought that ‘this was it’ and ordered a pair. But when they came, they were the ugliest pair of jeans I ever put on in my life, and in the end I sent them back.”

“I said to myself, it shouldn’t be that hard to shop responsibly,” de Messières says.

This summer, Citizens Market will launch a Web-only beta version of the service, with the mobile functionality to follow later. Up to now, the project has been totally driven by volunteers, including de Messières. The organization is now looking for a planning grant of roughly $60,000 to $80,000 get the service off the ground.

The big challenge for any initiative that relies on user-generated content, of course, is to build a real community. But there seems to be a lot of interest in the idea of a corporate social responsibility ratings site, at least judging from the backing that the Citizens Market already has received. The organization has recruited a board of advisers including several successful entrepreneurs and persons with ties to prestigious institutions like Oxfam America and Harvard’s Kennedy School of Government and Berkman Center for Internet and Society.

The interest was also strong when Citizens Market put out an ad for volunteer web designers on Craigslist last November. One of those who responded to the ad was Vanessia Wu.

“There seems to be a large community around here of people with an interest in corporate social responsibility,” Wu tells Xconomy.”They are willing to work on this thing, because it can make a big difference.”

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Newton, MA-based customer-rewards startup Jackpot Rewards says it will still hold a $1 million prize drawing every week. But as we reported yesterday, the company no longer promises that it will actually give the money away—removing one of the major incentives to join the company’s cash-back rewards program and making some existing members angry enough to cancel their memberships.

Jackpot Rewards didn’t return our calls inquiring about the change until after our story went to press yesterday. But later we were able to reach CEO Jim Miller, who says that the company is scaling back its jackpots mainly in order to spend more money subsidizing the product discounts it provides through its “Deal of the Day” offers. According to Miller, customers have been telling the company that they value these discounts more than they value the chance to win $1 million every week.

To be fair, the company’s earlier scheme was almost too good to be true, offering much better odds of winning than most other million-dollar sweepstakes. All members had to do to clinch the million-dollar prize was match two of the six balls in a thrice-weekly lotto-style drawing, then be the lucky person selected from all of the those qualifying—a group that included only 464 people in the company’s first drawing and 1,726 by its third.

Winning is now far more difficult. Under the new rules, people who qualify in the thrice-weekly drawings are assigned a number between 0 and 249,999, and win only if their number comes up in a random drawing. The company promises that during weeks when nobody wins—the likely outcome the vast majority of the time—it will hand out a $1,000 prize.

My conversation with Miller started out focusing on the reasons for the company’s change of heart—which is seemingly a major one, given that the company’s marketing message centers not just on giving away part of its own profits, but on encouraging people to “dream big” about the things they could do (including donating to charity) if they won a big jackpot. But after covering that—as you’ll see from the following transcript—we moved on to a discussion about the real value of the cash-back rewards Jackpot Rewards members can earn.

Xconomy: A former member of Jackpot Rewards sent us a copy of the customer newsletter from last week in which you announced that you are doing away with the guarantee that someone will win a $1 million prize every week. Can you please explain the thinking behind that decision?

Jim Miller: We wanted to stick with [offering] the best odds anywhere in the industry. Looking at us compared to other sweepstakes in the space, we are still doing that. We think that in that regard, the value proposition is still there. We are still leading in that category. And we are going to be implementing more prizes at various levels.

But what we’ve already found in the feedback from our customers is that the place where they really feel like we are spreading the wealth around is the “Deal of the Day” that we offer to customers. You can see that with [deals like] the trip to the Masters’ Tournament for 75 percent off, or exclusive tickets to sold-out events like Bruce Springsteen and Seinfeld. We are really responding to what we’re seeing as what motivates our customers.

X: The weekly $1 million prize was one of the company’s key marketing messages when you launched in February. In fact, in our interview, you told me that it was one of the things that differentiated you from other companies like Publishers Clearinghouse, which in your words would spend six months talking about giving away a million dollars before they actually gave it away—whereas, you said, Jackpot Rewards was going to go out and actually give away a million dollars, every week. This seems like a big change to that message.

JM: We see it as keeping the commitment to having the best odds. If you look at [Publishers Clearinghouse] as a comparison, it’s one that we still think is a welcome comparison, because their odds are 1 in 699 million. You’re talking about very good odds, with what we think is a very good value proposition, but also enabling us to provide increasingly attractive deals of the day to our customers— spreading the wealth and having people experience that in multiple ways.

X: Are you saying that the money you save by paying out less often on the million-dollar jackpots is going to be shifted over to providing more discounts?

JM: We’re shifting our priorities, and we’ll be implementing in the next few weeks things that we think our customers will find even more attractive. We’ve found that they are engaging with the site in ways that probably even exceeded our expectations on the shopping side. We think it’s good to enable people to save, especially as we head into what by all accounts looks like a recession. This enables us to have a little broader latitude to provide even better deals elsewhere on the site. And the third leg of the stool is the giving side. I think [members] will see in the coming months that we’re doing interesting stuff there, and that we’re remaining as committed as ever.

X: When I asked you in February whether Jackpot Rewards would have enough money to fund the weekly $1 million jackpots, you said that even if you were not able to recruit members as quickly as you predicted, you would still …Next Page »

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Less than seven weeks after it made a big media splash by promising to donate half its profits to children’s charities, Jackpot Rewards, the Newton, MA, customer-rewards and sweepstakes startup backed by Boston investing legend Peter Lynch, has put an end to what was perhaps the most unusual (and most expensive) part of its part of its sales proposition: a weekly $1 million prize drawing with a guaranteed winner.

In an e-mail newsletter circulated to program members last week, the company said that, “In order to create more winners, we’ve decided to make some changes. Beginning April 6, we will continue to hold a $1 Million Jackpot drawing on Sundays; however, there will not be a guaranteed winner each week.”

The change has upset some customers, and seems to represent a reversal of what had been one of the company’s most audacious and distinctive marketing promises. “When you look at most sweepstakes that have a large prize, it’s either illusory in which no one wins, or like Publishers Clearinghouse they take six months telling you that they’re going to give away a million dollars,” Jackpot Rewards CEO Jim Miller told Xconomy in February, when we covered the company’s launch. “Our philosophy is rather than telling you what we’re going to do, let’s just go out and start doing it. Ten days after we launch we’ll be giving away our first million-dollar jackpot and then each week thereafter.”

The company did give away five $1 million prizes before shifting this week to a random drawing system with no guaranteed winner. It was not immediately clear how this change in the company’s procedures would “create more winners,” in the newsletter’s words, rather than the same number or fewer. Jackpot Rewards executives did not respond to Xconomy’s requests for comment in time for this article.

Jackpot Rewards charges $3 per week for membership in its customer rewards program, which offers cash-back rewards of varying percentages when members shop at a selection of several hundred online retailers. The sweepstakes portion of the company’s program is designed as an incentive for consumers to join the shopping-rewards program—and to recruit others into the Jackpot fold (if friends join, members get more entries in the sweepstakes).

As the sweepstakes program was originally presented, the company promised to select at least one million-dollar winner each Sunday from a pool of members who qualified by matching the numbers on at least two out of five white balls or one white ball and one red ball in thrice-weekly, Lotto-style drawings for a progressive $100 to $150 million mega-jackpot. The odds that a member with matching numbers could win the million dollars were therefore determined by the number of other qualifying entries—and according to the company, only 464 people qualified for the first $1 million drawing on March 2, while 1,300 qualified for the March 9 drawing, and 1,726 qualified for the March 16 drawing.

Under the new rules for the weekly sweepstakes, published on the company’s website, the chances of winning the weekly $1 million prize are much smaller than that. In fact, it’s possible, perhaps even likely, for the new process to produce no big winner at all. Under the new rules, members who qualify for the million-dollar sweepstakes through the thrice-weekly drawings are now assigned a unique number between 0 and 249,999. The company then selects a random number in that range, and if there is an entry matching that number, that member wins. (The $1 million prize is payable as a lump sum of $420,000 up front, or in 41 equal payments of about $24,390 over 40 years, according to the rules). If there’s no matching entry, the company picks one of the qualifying entries at random for a $1,000 prize.

In effect, then, the company has replaced its $1 million guaranteed prize with a $1,000 guaranteed prize. “The $1 Million drawing will continue to have the best odds to win $1 Million of any sweepstakes and in the coming weeks we will be offering more prizes and deals,” the company said in the e-mail newsletter.

It is not clear what provoked the change. When I asked Miller in February how long the company could go on funding a million-dollar weekly prize, his answer was as follows: “The company is structured in a such a way, and has sufficient funding, so that even if we grow at a glacial pace that’s far below what any model of the marketplace would predict, we will still be able to fund the weekly $1 million jackpots for almost as far as the eye can see.”

The eye must not have been able to see very far, and at least one customer is not happy about it. Leslie Sault of Virginia Beach, VA, says she cancelled her Jackpot Rewards membership last week after reading about the change in the newsletter. “I am no expert, but for some reason the term ‘Bait and Switch’ comes to mind,” Saul told Xconomy.

Jackpot Rewards launched with $16.7 million in financing, with Fidelity Magellan Fund legend and philanthropist Lynch as one of the leading backers. The company’s own philanthropic intentions are a big part of its marketing pitch. According to Miller, the idea for Jackpot Rewards came up in discussions among a group of Boston area businesspeople, including Lynch and himself, who had set out to create new models for raising money for charities. “What we were looking for was a way to create an economic engine for the common good,” Miller said in February.

Update, April 8, 2008: We’ve published a followup interview with Jackpot Rewards CEO Jim Miller, who says the company is scaling back the weekly jackpot in order to spend more subsidizing the product discounts available to program members.

Also, I spoke with Richard McGowan, a Boston College statistics professor and an expert on the gaming and lottery industries. He says that even with the recent changes, the odds of winning the Jackpot Rewards million-dollar drawing are still “a lot better” than the state lottery.

“In terms of lotteries, [Jackpot Rewards] is the best thing going,” McGowan says. “The odds are not great, but most people play their dreams, and when you think about it, this gets you a lot closer to your dreams than some other sweepstakes.”

Update, April 9, 2008: The Jackpot Rewards story has now been picked up by the Boston Globe, the Boston Herald, and Mass High Tech. The Herald’s story is the best, observing: “…although it’s backed by former Fidelity money management guru Peter Lynch and former Boston advertising ace Jack Connors—and it promised to donate half of its profits to children’s charities—it was the hype of a weekly $1 million winner that garnered media attention for Jackpot Rewards….Its reversal calls into question whether that lucrative incentive was a marketing ploy to attract members, but Miller says the policy change is a matter of a young company adjusting to customer requests.”

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They say one good deed begets another. Apparently one good charity story also begets another.

The day after Rebecca published her piece last week on Givvy, the Framingham, MA, startup planning to offer online tools to help people track their charitable donations—and the very same day I wrote about Newton, MA, startup Jackpot Rewards, which plans to give away half of its profits to children’s charities—a public relations exec in New York wrote to tips@xconomy.com to let us know about yet another Boston-area company planning to use the power of the Web to orchestrate more effective fundraising for charities. This one is called Good2Gether. And it could prove to be the most powerful of the three, in terms of sheer ability to transform people’s charitable instincts into action.

The Cambridge, MA-based startup is constructing what you might call a “hyperlocal giving aggregator”—an advertising-supported, keyword-based widget designed to appear alongside news stories on the websites of major regional media organizations, where it displays information about local non-profit fundraising campaigns or volunteer opportunities related to each article.

Say you’re living in San Francisco and you’re reading a story in SFGate, the San Francisco Chronicle’s regional Web portal, about a string of tornados striking somewhere in the Midwest. Good2Gether’s widget might give links to a local Red Cross chapter organizing a blood drive to help the victims, or to a local Humane Society chapter collecting money to help displaced pets, while at the same time showing an ad for State Farm insurance.

It’s one of those virtuous circles that the Internet is so good at completing: the non-profits get to make their pitch to a lot of readers, the newspaper website gets some ad revenue, and the advertisers get the glow of being associated with a humanitarian cause. The SFGate example is hypothetical—but the real system is scheduled to go live in eight major media markets this year, starting in Boston in April. (Good2Gether says it can’t yet reveal which Boston media outlet will run the widget, but the San Francisco Chronicle and the Houston Chronicle have already announced that they’ll participate.)

Good2Gether is the brainchild of Gregory McHale, the former CEO of electronic-whiteboard maker Virtual Ink and also the founder of cMarket, a 50-employee Cambridge company that’s the main provider of infrastructure services for the online auctions that thousands of non-profit organizations around the country use these days to raise money. McHale told me that the idea for Good2Gether came from his conversations with cMarket’s users about their frustrations getting the word out about their fundraising and volunteer needs, especially to younger crowds.

“I was meeting with non-profits all the time and listening to them about all the money they have to spend on marketing to their current constituencies, and about their terror about the crew of millennials coming at them just over the horizon,” McHale says. “Millennials,” also known as Generation Y, are young people born between 1980 and 1995; raised on the Internet, these folks are proving unresponsive to the communications channels that non-profits have traditionally used to raise awareness, such as print newspapers, local television, direct mail, and telemarketing.

“So on the one hand, you have lots of non-profits that are trying to reach people, including young people,” says McHale. “On the other hand you have these websites run by newspapers, radio stations, TV stations, college papers, and magazines that have millions of viewers but are desperate for …Next Page »

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The idea of sponsoring a weekly $1 million sweepstakes isn’t exactly high-tech. Neither is the idea of giving consumers cash rewards for their purchases, or the concept of committing a portion of your company’s profits to kids’ charities. But mash these things together—and put the whole thing on the Internet, where viral marketing and other network effects can really kick in—and you’ve got an intriguing Web 2.0 business plan that just might end up generating a lot of money for children’s health and education.

That’s the hope at Jackpot Rewards, a Newton, MA-based startup launching today with backing from some of the region’s most notable business leaders and philanthropists, including former Fidelity Magellan fund manager Peter Lynch and Hill Holliday founder Jack Connors. The basic pitch to users is simple: In return for a $3-per-week membership fee, users get quarterly checks amounting to 12 percent of their purchases at more than 550 participating online retailers, such as Best Buy, Barnes & Noble, GAP, Land’s End, Nike, Overstock.com, and Target. As an enticement to join, members also get to pick Lotto-style numbers that are entered into a thrice-weekly drawing for a progressive jackpot worth $100 million to $150 million. If at least two of their six numbers come up in a Monday, Wednesday, or Friday drawing, members are also entered into a Sunday drawing where someone is guaranteed to win $1 million—a prize paid out in the form of an annuity financed by the aforementioned membership fees.

Those are the mechanics, anyway. If a Visa or a Publishers Clearinghouse came out with a similar cash-back/sweepstakes program, the world would probably yawn. But Jackpot Rewards has an intriguing backstory that may increase both its appeal to consumers and its chances of success. Frankly, it’s one of those sounds-to-good-to-be-true tales that activated all of my skeptical journalistic instincts when I first heard about the program—but after getting the whole story last week from CEO Jim Miller, a former telecom entrepreneur with a history of raising scholarship money for at-risk inner-city youth, I’ve adopted an attitude of watchful optimism.

It all centers around two facts: One, that Jackpot Rewards will donate half of its after-tax profits to children’s charities, and two, that everything about the company, from the structure of the rewards program to the rules of its sweepstakes, is designed to maximize the amount the company is able to give away. In that sense, Jackpot Rewards is part of a corporate-philanthropy and social-entrepreneurship movement that goes back decades. But few social entrepreneurs in history have hatched schemes as high-stakes or as brazenly consumer-oriented as the Jackpot Rewards program, which has been four years in the making.

“What we were looking for was a way to create an economic engine for the common good,” says Miller. “So we asked ourselves, what is something that can create a massive network effect that will drive large numbers of consumers to participate? Well, you will find that over 50 percent of consumers participate in some kind of rewards program, whether it’s a cash-back card like the Discover card or one of the frequent-flier-miles credit cards that a lot of people carry. And sweepstakes are considered one of the most effective …Next Page »

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Think about the causes that are closest to your heart—the environment? The wellbeing of children? Social justice? The fate of NBC’s critically acclaimed “Friday Night Lights?” Now think about the charitable donations you made last year. Even if you’re one of those incredibly organized people who has already gathered all of his 2007 receipts into neat piles and deposited them with the accountant, chances are you can’t really say just how well, or poorly, your charitable spending aligns with your beliefs and priorities. Givvy founder John Treadway thinks you’d feel better and make better decisions about giving—and ultimately, give more—if you had easy access to that and other information.

Treadway is building Givvy to provide online tools that give individual donors “more control and more empowerment over why, when, where, and how they give to charities.” What does that mean, exactly? I’d love to tell you, but the company is so brand spanking new (as in, founded in December, moved into its office in Framingham, MA, the week before last) that its only product right now is the intriguing, if coy, musings of its founder. (Delivered in person and via the Givvy blog.) Still, Treadway is giving away just enough to that you can imagine a Web portal that might help you plan, track, organize, and analyze your donations. Given the nagging guilt I feel over the fact that most of my own giving is done essentially at whim, usually in response to an over-the-transom appeal that happens to be particularly clever or resonant, I find the idea appealing.

A veteran of product management and business development at firms including Sybase, Powersoft, and Object Design, Treadway spent the last few years working on Digibug, a photography e-commerce services provider that he founded in 2003. When it became clear that the company wasn’t viable (Treadway says it will be sold or folded in the next couple of weeks) he started cooking up his plan for Givvy. The startup’s cofounders, Seth Lipkin and James Andrews, are developers that Treadway knew from his Digibug days. Givvy is operating on a bootstrap so far, Treadway says, and plans to try to drum up about half a million dollars in seed financing once the alpha version of its technology is ready, which should be next month.

Treadway promises to make more concrete details public once he’s produced something that people can get their hands on, but in the meanwhile he shared a few more tidibits: Givvy will target a broad audience of givers including “Xs, Ys, Zs, and boomers,” he says. It will incorporate lots of Web 2.0 features—user generated content, comments, and the like—as well as much of the same sort of tax data on charitable organizations that sites like Guidestar.org offer for would-be donors looking to peek under nonprofits’ hoods. But at Givvy’s core, Treadway says, will be very specific tools for “people who want to get a lot more systematic about how and what and where and why.”

There’s that “why” again. I told Treadway that when he says Givvy is helping people understand, among other things, why they’re giving, it almost sounds like therapy. “We can call it charity therapy,” he allows. Very wealthy individuals, he points out, often have lengthy conversations with their advisors about how they want to shape their financial legacy. “Why can’t the average person have the same thought process and discussion about what they want their legacy to be?” Treadway asks. “We expect it will be therapeutic, though that’s not the intention,” he adds. “But we want people to look back at the end of the year and feel good about what they’ve done.”

Treadway is, of course, saying close to nothing about how Givvy intends to make money amidst all this giving and feeling good. “I can tell you one way we’re not going to make money—we’re not going to touch a dime of the donations that go through the system,” he says. Beyond that, all he’ll cop to is the general notion that there are three ways to make money online: ads, subscription or user fees, and commerce. “It will be in one or more of those three categories that we will make money,” he says.

Givvy will be ready for a controlled beta test by the end of the second quarter, Treadway says. Meanwhile, I’m off to think about whether I’ve really been putting my charitable money where my public-health-concerned mouth is. Now where did I put those receipts?

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