Newt Gingrich comes across on TV as someone who radiates smugness. It’s that sense that he’s not just confident in his own abilities, but extremely satisfied with his talents and his utter superiority over mere mortals like you and me.

I’m no political pundit, nor a psychologist, so I’ll let others analyze whether Newt is presidential material. But good old Newt got me thinking this past week about this specific character trait, and other unappealing elements of personality, that we often see in leaders of the life sciences industry. Bob More, a veteran venture capitalist with Frazier Healthcare Ventures, inspired me to delve into character this week with one recent comment on Twitter.

“Politics pretty similar to backing CEO’s. Newt may be smart and a good debate guy. But Newt=Smug. Never back smug,” More wrote on his Twitter account (@Bobmorevc).

Given how often people harp about the need to find superb management teams for developing new drugs or devices, I followed up with More to hear his thoughts on character traits to back, and to back away from, in life science entrepreneurs.

The No. 1 character trait to look out for, according to More and his mentor Jim Blair at Domain Associates, is trustworthiness. Dishonesty, to them, is the king of all deal-breakers. For example, More says he once worked for six months scrutinizing every imaginable aspect of a prospective investment for Domain, which he was quite excited about. Then at the last minute, the entrepreneur mentioned a slight change to the term sheet.

Bob More

“It felt like one of those things where a real estate agent comes in at last minute, and says ‘Oh, it’s just another $6,000 fee for the house,’” More recalls. He left that meeting with doubts about the executive’s credibility in other situations. When he asked Blair for advice, the response was memorable: “Kill the deal. Life is too short to deal with people like that,” More recalls Blair saying at the time. (Blair confirmed the story, and added that it wasn’t the only time he’s stopped an investment because of character concerns.)

This is tricky stuff, because all kinds of dishonesty unfortunately passes for standard procedure in business—ever hear of an executive resigning to “spend more time with family?” But the honesty thing is worth harping on in this specific context, because it strikes me that life sciences has more than its share of spinmeisters, hypesters, smoke-and-mirrors actors, and worse. One of the sure tests of honesty, More says, is to ask whether an executive will be candid and forthright about bad news in private, so that board members or advisors can work together constructively to solve the problem.

“You can deliver good news whenever, but delivery of bad news should be pretty quick. If you’re hiding bad news or hoping it will go away, it’s not a good trait,” More says. “When people are forthright, it builds trust.”

Then there’s smugness, that arrogance or sense of superiority. Developing innovative new drugs or devices requires a strong ego, high IQ, stamina, an inspiring personality that attracts other people, and other things. Often, that combination spills over into smugness or arrogance. More says he watches for a lot of the same cues that his sister, a teacher, watches for … Next Page »

Comments (9) | Reprints | Share:          

They say the first casualty of war is the truth. Based upon recent events in the U.S. presidential elections, it looks like the truth is a casualty in politics as well. Whether out of desperation, ignorance, or political convenience, current and former contenders for the Republican presidential nomination have been questioning the long-term economic value of venture capital and private equity, which has been wrongly and unfairly labeled “vulture capitalism.”

First, let’s be clear. Venture capital and private equity—while related in that they both involve pools of private capital striving to generate returns for their investors (typically non-profit pension funds, foundations and university endowments)—follow very different approaches in achieving their goals. But neither seeks to undermine employees. In fact, venture capital typically creates jobs over the long term and private equity minimizes job losses.

Venture capital—a key component of the financial foundation for Silicon Valley—is focused on leveraging creative talent, capital, the hard work of employees and entrepreneurial experience to create and grow new businesses based on disruptive ideas. When successful, new businesses and industries are the result—creating new jobs for employees and wealth for investors and contributing to the competitive posture of America. When unsuccessful, the venture capital investors involved and their employee partners bear the costs of the failed effort. There are no government bailouts here—unless the politicians become involved a la Solyndra, the clean tech startup that fell into bankruptcy despite a $535 million federal loan guarantee. A situation like Solyndra is rare, however.

Venture capitalists and entrepreneurs don’t always win in the marketplace, but they don’t quit, either. In many instances, the same investors and talented engineers who failed will form new teams and pursue new dreams—always looking to create value and opportunity from ideas. The innovation flywheel is often successful and very lucrative: According to a 2011 Global Insight study, venture-backed companies accounted for 11.9 million jobs (11 percent of U.S. private sector employment) and $3.1 trillion in revenue in the U.S. in 2010—21 percent of the total US GDP–all based on an annual investment equal to less than 0.2 percent of GDP.

By and large, these are jobs at the higher end of the spectrum with solid, innovative companies—and often those that become global industry leaders, such as Intel, Apple, Google, Genentech, Facebook, Twitter, to name but a few. Ironically, while countries around the world are replicating the U.S. venture capital model and working overtime to encourage innovation and support venture capital ecosystems, U.S. politicos, themselves devoid of any new or creative ideas, have chosen to attack the engine of U.S. technology leadership.

Private equity also plays an important, though different, role in the U.S. economy. It builds and restores established but usually faltering companies. While colorful robber baron images of Gordon Gekko, acquiring functional businesses and breaking them apart for pure financial gain, may still be a popular reference point in today’s media, it is an inaccurate analogy in the vast majority of cases. Like venture capital investors, most private equity investors are paid for building real value, for themselves and their investors, not simply to make a quick buck. They do this by investing in under-performing companies, often in or on the verge of insolvency, in hopes of … Next Page »

Comments (7) | Reprints | Share:          

Microsoft is joining several other notable corporate names throwing their support behind full marriage rights for gay couples in Washington state, a move that could give a final push to gay-marriage efforts at that state Capitol this year.

The companies—including RealNetworks, Concur, and Paul Allen’s Vulcan—announced their support for a possible state gay-marriage law on Thursday. The Seattle Times has a copy of the letter the firms sent to state officials.

Microsoft further explains its position in a blog post by its head lawyer, Brad Smith, who says that granting full rights to same-sex couples would reflect the company’s values and be “good for our business and good for the state’s economy.”

“As other states recognize marriage equality, Washington’s employers are at a disadvantage if we cannot offer a similar, inclusive environment to our talented employees, our top recruits and their families. Employers in the technology sector face an unprecedented national and global competition for top talent,” Smith wrote.

Smith noted that gay marriage is legal in six other states, including Massachusetts and New York. California’s gay-marriage laws are still tied up in court, after one federal judge overturned a previous gay-marriage ban.

In a short statement on its Facebook page, Vulcan said supporting gay marriage “is part of our company’s core values, which include appreciation and support for employees with diverse backgrounds. We believe that everyone has the right to be valued on their merits and contributions, not on their sexual orientation.”

Microsoft’s support for gay marriage in Washington is hugely significant.

Legislators in Olympia are now just one vote shy of being able to pass a bill legalizing civil marriages for same-sex couples, and one of the state senators representing parts of Microsoft’s hometown of Redmond, Republican Andy Hill, has been among the undecided.

As a humongous publicly traded corporation with tens of thousands of employees, Microsoft also has to sound a bit of a cautious note, saying that it respects the views of employees who might disagree with the company’s embrace of gay marriage rights.

“We’re not asking anyone to change their views to conform to the company’s position,” Smith wrote.

Comments | Reprints | Share:          

It’s not just Wikipedia that’s throwing its weight today behind the movement to stop the controversial anti-piracy bills moving through the U.S. Congress.

While the English version of the world’s most-visited encyclopedia site has gone dark for the day to call attention to the perceived dangers of the Stop Online Piracy Act and the Protect Intellectual Property Act, a number of other organizations are stepping into the spotlight, making their case that the laws—which, in their original form, would have given federal prosecutors and courts the power to block access to Internet domains deemed to be supporting “infringing” activities—would deter free speech and undermine the Internet’s technical infrastructure.

Given indications that markup of the bill is being delayed, as well as the Obama Administration’s recently declared opposition to SOPA (the House version of the bill) and PIPA (the Senate version), it’s doubtful that the anti-piracy bills will make it into law this year. But protesters and Internet entrepreneurs are saying today’s actions are necessary to forestall future Congressional action and call attention to the extent of popular opposition to the bills.

Here’s a quick survey of protest actions going on today around the San Francisco Bay Area and Xconomy’s other home cities.

—Hackers & Founders plans a live protest against PIPA and SOPA at San Francisco’s Civic Center Plaza at noon Pacific Time today. The group of programmer-entrepreneurs says it’s joining forces with other groups such as 106 Miles, SV NewTech, SF NewTech, Designers and Geeks, Hacks & Hackers, the Electronic Frontier Foundation, the Internet Archive, and TechNet to stage similar events in New York, Seattle, Silicon Valley, and Washington, D.C. Speakers expected at today’s protest in San Francisco include angel investor Ron Conway, Internet Archive founder Brewster Kahle, TechNet vice president Gideon Lett, and Hackers & Founders founder Jonathan Nelson.

—The Occupy Oakland website used by coordinators of grassroots protests in the East Bay has gone dark for the day—but features a nifty mouse-tracking spotlight that allows you to read a statement explaining the action.

—The 20,000-member New York Tech Meetup group has blacked out its site and is organizing an “Emergency NY Tech Meetup” today at 12:30 Eastern time at 780 Third Avenue in Manhattan, outside the offices of Senator Charles Schumer and Senator Kirsten Gillibrand. Speakers will include Meetup.com CEO and NY Tech Meetup founder Scott Heiferman, NYU media studies scholar Clay Shirky, Grateful Dead lyricist John Perry Barlow, Reddit co-founder Alexis Ohanian, and Tumblr vice president Andrew McLaughlin. New York Tech Meetup chairman Andrew Rasiej said in a statement that the tech community in New York is “appalled” by Schumer and Gillibrand’s support for PIPA.

–A Seattle Against SOPA rally originally planned for 11:30 a.m. Pacific time today has been postponed due to the city’s poor weather, but organizers say they will reschedule the event.

—Google is censoring itself by placing a symbolic black square over its logo. The search and advertising giant has also posted a petition urging members of Congress to vote against PIPA and SOPA.

—Craigslist has interposed a black landing page protesting SOPA and PIPA before users can reach its online listings (which are still accessible).

—Flickr, the photo sharing site owned by Yahoo, offered users the ability to black out up to 10 photos each as a symbolic way to”deprive the web of the rich content that makes it thrive.”

… Next Page »

Comments (1) | Reprints | Share:          

Some interesting news tidbits in Boston-area mobile and marketing/ad tech today.

—Zmags, the Boston-based mobile and social commerce company, has raised $7 million from Square 1 Bank and existing investors OpenView Venture Partners and Northcap Partners. Zmags makes a software platform to help brands and retailers design marketing and merchandising campaigns across mobile devices, tablets, and Web. The new money roughly doubles the amount Zmags has raised to date; the company expects to close an additional growth equity round this year. Last May, CEO Michael Schreck spoke with me about the firm’s transition from digital publishing to commerce, and about mobile marketing trends over the past decade.

—Jumptap, the Cambridge, MA-based mobile advertising firm, has been working with Mitt Romney to create and run targeted campaign ads (at the zipcode level) for the Iowa Caucus and New Hampshire primaries. The company says Romney is the first candidate to run mobile ads in both sites. We’ll be watching to see how mobile technologies influence the upcoming presidential election.

—Apperian, the Boston maker of a mobile-app platform for businesses, is powering AT&T’s new mobile application management product. The software helps companies and other organizations create, distribute, and manage secure mobile apps. Apperian has worked with AT&T for the past several years, but the new announcement could be an important validation of where Apperian stands in the market.

Comments | Reprints | Share:          

A new decade of “smart health” arrived in 2011.

Granted, it wasn’t always easy to discern – what with the noisy background of healthcare legal challenges and political one-upmanship. Fortunately, even while various policies continue to be ironed out, a set of resilient entrepreneurs have been busy making sure we get smarter about our health.

The idea of interactive health – where consumers play an active role — seemed far off when I completed my PhD in molecular biology in 1994. In fact, the healthcare and medical communities have been among the laggards in transitioning to the digital age.

While traditional scientific entrepreneurs continue to make great strides in our understanding about disease diagnosis and treatment and genetics, a new breed of digitally-savvy, health-focused entrepreneurs have arrived on the scene. They are focused on dissecting and disseminating a vast and growing body of health knowledge and distilling it in ways that are meaningful to both clinicians and consumers alike.

Who are they? People like:

• Ron Gutman, an entrepreneur we seed funded last year after he explained his vision of “trustsourcing” versus crowdsourcing for relevant health information. His company, HealthTap, announced this week a new round of financing and is now connecting consumers with more than 6,000 leading U.S. physicians and 500 healthcare institutions from mobile devices or the Web with its new Q&A model.

• Aza Raskin, the former Creative Lead for Firefox and a founding member of Mozilla Labs, who this year turned his attention to bringing the kind of innovation we expect from the Internet world to health care. He is a co-founder of MassiveHealth, which recently launched “The Eatery,” an iPhone app that tracks and analyzes overall eating patterns to provide a big-picture breakdown of the best ways to improve your habits.

• Halle Tecco, one of the founders of Rock Health, a seed-accelerator we work with along with others in the venture community. Its mission: catalyze innovation in the interactive health space. Along with Rock Health, we believe mentorship and operational support – in addition to funding – is where entrepreneurs can benefit most.

At this week’s mHealth Summit in Washington DC, Kathleen Sebelius, the Secretary of the U.S. Department of Health and Human Services, described in her keynote a “remarkable future” where control over a patient’s own health was always within their control. This wouldn’t be possible without advances in web and mobile.

We anticipated that same future a few years ago, which is why we have been active investors in this area. My colleagues and I believe the next big healthcare breakthroughs will be a direct result of “smart health” – brought to us by the exponential growth in web and mobile technologies and the ingenuity of consumer-centric entrepreneurs. (No politicians required).

Comments (1) | Reprints | Share:          

The state of Washington is chipping in $5 million from a federal jobs program to put the finishing touch on a new $25 million investment fund that will look to spin more startups out of research labs at the University of Washington, Washington State University, and other local research institutions.

Gov. Chris Gregoire is announcing today the state’s contribution to what’s being called the W Fund. The program, administered by the Department of Commerce, is one piece of a broader five-year, $19.7 million plan the state has devised to make it easier for small businesses to get access to credit. The two other parts of the program will provide direct loans to businesses in underserved communities such as Indian country, and help facilitate bank loans for small businesses that aren’t quite in position to borrow today, says Commerce director Rogers Weed.

We first reported on the development of the W Fund in October 2010, back when it was tentatively being called the Husky Bridge Investment Fund. Linden Rhoads, the vice provost who runs the UW Center for Commercialization, said at the time the fund had secured $13 million toward a goal of creating a $20 million pool to invest in university startups. The vision is to help business students gain experience by vetting company ideas from university labs, and then potentially gaining real-world experience by helping entrepreneurial faculty to turn their ideas into real companies. The money for the W Fund is primarily coming from wealthy individuals and foundations seeking a return on their investment, and seeking a way to help startups gain further venture capital financing.

Rogers Weed

The state has found its way to participate by routing money it has obtained through the federal Small Business Jobs Act, passed in September 2010. The state won’t take any equity stakes along with the investors in the W Fund, but it will be in a position to get its money back from the W Fund investors, plus interest, if the investments turn out positive, Weed says.

Now that the state has gotten involved, the W Fund will expand its focus from the University of Washington to other research institutions around the state which have ideas for companies in the high tech, biotech, and cleantech industries.

“They’ve broadened what they’ll look at in terms of deal flow in return for us coming in as a partner,” Weed said in an interview Friday at his Seattle office.

Rhoads, who has led the effort to build the fund, said in an e-mail: “We believe that this will be a $25M fund that begins considering investments in February.”

Since this is part of a federal jobs act, I felt it was only reasonable to ask Weed how many jobs he expects will be created by these various programs. He offered what he called a conservative range, of 4,000 to 4,500 jobs statewide through direct, indirect, and what economists call “induced” employment because of the increased spending from the other jobs.

“This issue of access to credit and investment capital is a crying need I’ve been hearing about for two years now,” Weed says. “I don’t know how many jobs it will create, but the important thing is that small business will have more access to credit and capital at a critical time.”

Comments (3) | Reprints | Share:          

In the long-running debate over online sales tax laws, one of the most laughable ideas has been that calculating sales tax rates all over the country is somehow a difficult job for big e-commerce companies like Amazon.com.

You know, the same company that adds enough servers every single weekday to run a circa-2000 version of itself. The same company that knows every item I’ve ever perused, and can tell me what fellow shoppers bundle and buy. The same company that gives away streaming movies and takes a loss on full-color touchscreen tablets just to get people in the buying mood.

But that’s been the basic argument against various cash-starved states’ attempts to pass “Amazon laws” deputizing online retailers as new tax collectors. A longstanding U.S. Supreme Court decision, enacted before the Web was a force in retail, held that figuring out sales tax rates for thousands of jurisdictions nationwide would put a burden on interstate commerce. And that is something only Congress is allowed to do.

That could be happening sometime soon. As we’ve discussed, Amazon is putting its weight pretty heavily behind a new online sales tax system being debated in Congress. The latest evidence of the Seattle company’s dedication was on display today, as VP Paul Misener testified at a U.S. House committee hearing on the issue.

In his prepared remarks, Misener acknowledges the obvious fact that software has solved the problems with national sales tax collection: “With today’s computing and communications technology, widespread collection no longer would be an unconstitutional burden on interstate commerce, and Congress feasibly can authorize the states to require all but the very smallest volume sellers to collect.”

He also shouts out Avalara, the Bainbridge Island, WA-based company that has been a leader in supplying online sales tax software to retailers, particularly small and medium-sized sellers. As CEO Scott McFarlane recently told me, all the talk of sales tax collection being some kind of unfathomable dark art is frustrating for the entrepreneurs trying to solve the problem.

“What chafes me is when people say that there’s not a solution out there, it’s too hard. The reality is, it isn’t. It’s a statutory requirement. We have the technology,” McFarlane said.

It’s encouraging to see so much progress being made on an issue that’s lingered, probably needlessly, for so long. Amazon’s sometime foe at the National Retail Federation, which represents a lot of the big brick-and-mortar retailers, also is behind the recent push to enact a national online sales tax system.

The fight for now seems to be over which businesses to exempt from such a system. The bill Amazon’s supporting gives a pass to sellers making less than $500,000 a year in revenue, and Misener’s testimony calls out $150,000 as an even better figure. eBay, in its own testimony today, wants a much bigger small business exemption—eBay’s Tod Cohen threw out several suggested thresholds, from $5 million up to $30 million.

There is the matter of a little election about a year from now, which could see big changes in who’s in charge over in the other Washington. It’s not clear whether this issue will be resolved before the political climate gets hot and heavy—if you were running for re-election, would you want some opponent running ads about how you voted for an Internet sales tax?

Comments (2) | Reprints | Share:          

The Federal Communications Commission gave AT&T and T-Mobile USA a little kick on the way out the door today, releasing its staff report on the companies’ proposed $39 billion merger. AT&T and T-Mobile parent Deutsche Telekom pulled their merger application last week (on Thanksgiving!), choosing instead to focus their regulatory fight where it really matters—the antitrust lawsuit from the Justice Department.

The companies didn’t want the FCC report to be made public, but they lost that battle, so we now have some extremely detailed reading to dive into. You can check it out for yourself over at the FCC site. The document is chock full of technical detail and legal analysis, but it really boils down to a broad rejection of the claims made by the two companies to support their deal.

The upshot is on pages six and seven, where the staff report tears apart the justifications for the buyout. There are three basic areas of concern—first and most broadly, the report says the effects on competition would be too severe, with a higher likelihood of coordination among the remaining players and questions about the markets for handsets along with roaming, wholesale, and other wireless services.

The report also slaps aside the economic and engineering models that AT&T and Deutsche Telekom used to claim that the buyout would drive down wireless industry prices and network costs. And finally, the report says any savings from the combined operations of the two carriers could result in poorer customer service rather than lower prices, and wouldn’t drive any increase in jobs.

Of course, lots of the really interesting information is redacted—but I did find one fun spot where someone messed up and forgot to white out some things that are marked confidential. It’s in the footnotes on page 12, where the commission is discussing T-Mobile’s strength as an independent competitor.

“Indeed an email exchange argues that ‘T-Mobile’s 4G network is much faster than AT&T’s network,’” the unredacted material says, citing December 2010 email between Paul Weisbecker of AT&T and Kelsey Joyce of T-Mobile. Here’s a screenshot of that passage, in case it gets pulled later:

As you can see, a second area that appears to be unintentionally published immediately follows that, saying that T-Mobile’s network expansion “puts T-Mobile ahead of its competitors in terms of network speeds.” That citation points to Network Business Quarterly, an industry report by the analysts at Technology Business Research, so I’m not sure why it would have been designated for redaction in the first place.

The report’s discussions of small, regional wireless carriers has some new weight amid the New York Times report that AT&T’s hope now is to carve off chunks of T-Mobile  to prop up a new No. 4.

The discussion on pages 33-38 of the FCC report lays out just how tiny these small wireless providers are in relation to the big guns—if measured by revenue, the three largest of those also-rans only makes up about 6.5 percent of the national wireless market combined, compared to T-Mobile’s 11 percent.

“To provide service comparable to a nationwide provider, and thus be able to compete effectively and prevent competitive harm, a regional provider would most importantly need to obtain a nationwide spectrum footprint and the resources to build it out,” the report says. “In only one of the top ten markets to Leap, MetroPCS and U.S. Cellular, the largest regional firms, have half as much spectrum combined as T-Mobile’s spectrum holdings.”

That’s a pretty big gap to make up with pieces from a dismembered T-Mobile. If AT&T can get a deal in place with the feds to make a new fourth-place carrier, this report would provide plenty of ammo for evaluating whether the deal passes the smell test.

Comments | Reprints | Share:          

After a year of epic battles with politicians and brick-and-mortar competitors, Amazon.com has made sales-tax policy a relatively sexy topic in the business world. But another Seattle-area technology company has been working for years to navigate complex sales tax systems—and it’s growing like a weed.

That company is Avalara. Started by an accountant/developer and based on Bainbridge Island, WA, the company provides web-based software that helps businesses automatically calculate and pay sales taxes with precision, no matter where the sale takes place.

How big a problem is that? There are about 11,000 different taxing districts in the U.S. alone, with overlapping boundaries, shifting rates, and long lists of exemptions. Selling the same item to two homes in the same neighborhood could actually mean charging two different amounts for sales tax, if they’re on opposite sides of a tax boundary. And retailers are deputized as the tax collectors, taking in all the revenue up front and sending the government its cut.

It’s the kind of complex, constantly shifting set of data that has been practically begging for a software solution for years. But even businesses that were already using accounting software to keep their books traditionally had to punch in the nitty-gritty details of sales tax data manually.

Avalara makes it automatic by tracking the sales tax zones nationwide, tying them to a sale’s location, and plugging in the information exactly where it’s needed in accounting or e-commerce software. And since the Internet has expanded the sales footprint of virtually any business, making it possible for even a small retailer to find customers nationwide, making those calculations has become increasingly necessary.

It’s also downright fun, if you ask the Avalara guys. Even though their particular island is of the more frigid San Juan variety, the company embraces a pretty lighthearted culture that counters the potentially dry subject of sales tax policy. The executive team donned tropical shirts for their official headshots, and when we met recently at the company’s Seattle office, CEO Scott McFarlane’s shirt stripes, watch face, and laptop skin were all being employed to display Avalara’s signature bright-orange color scheme.

“Some people want to put a computer on everybody’s desktop. I just want to calculate everybody’s transactions,” McFarlane says with a powerful laugh.

Avalara got its start in 2004, and now has about 250 employees worldwide. The company, which has raised $21 million in financing this year, is led by three co-founders: CEO McFarlane, technical chief and board chairman Jared Vogt, and tax chief Rory Rawlings, the accountant-developer who has also been instrumental in helping to develop national sales tax policy through the Streamlined Sales Tax initiative.

Avalara’s rise has been quick enough to land it on the Inc. 500 list of fast-growing companies in 2010. It made the larger Inc. 5,000 list this year (No. 682), with last year’s revenues pegged at $16.7 million. This year, the business will grow again by 50 to 75 percent, McFarlane says, putting Avalara’s sales in the neighborhood of $25-$30 million. … Next Page »

Comments (5) | Reprints | Share:          

You could feel Herman Cain’s presence last week on the biotech beat. And there was a lot of grousing about it.

Cain, the Republican presidential candidate known for his simple 9-9-9 tax plan and some dubious extra-curricular activities, didn’t attend the Personalized Medicine Conference at Harvard Medical School. But a former advisor to President Obama, Ezekiel Emanuel, was there channeling his inner Cain, delivering a simple, blunt message to top biomedical researchers, business executives, and investors.

The word from Emanuel, the University of Pennsylvania bioethicist and player in the landmark healthcare reform law of 2010, boiled down to this: Personalized medicine is a lot of hype, it will add costs to the healthcare system, and we can’t afford it. What personalized medicine ought to offer, he said, is a “1-100-0″ plan. That means treatments that are truly tailored for a single individual; almost 100 percent effective; and have almost zero side effects.

That’s fantasy, of course, which Emanuel knows quite well. He was being purposefully provocative, and said so. In a roomful of like-minded people having a garden party, he was happily playing the role of the skunk.

Personally, I thought Emanuel gave a brutally honest message that a lot of these people need to hear. It could have been perceived as a rallying cry to come up with new innovations for health that truly reduce, instead of add, costs to the system.

But that’s not how the message was perceived. Everywhere I went the rest of the two-day meeting, people were grumbling about the nerve of this guy. One prominent executive complained that Emanuel shouldn’t have been invited. Emanuel’s not an economist, what does he know? He’s relying on faulty data! What about innovations that improve patient outcomes, helping people live longer and better lives? Isn’t that worth it?

“There seems to be a lot of angst about what’s going on here, but these are still early days,” said Brook Byers, the champion for personalized medicine at Kleiner Perkins Caufield & Byers, during a moderated chat later in the day. “These things take a while. I’ve been doing this long enough to have been through a lot of things in computation, healthcare, and biotech. But personalized medicine is a way of thinking.” And then he made a vague reference to Emanuel that everyone got. “I think the day got started off a little weird,” he said.

Brook Byers (right) pictured with Pascale Witz of GE Healthcare's Medical Diagnostics business, and Raju Kucherlapati of Harvard Medical School

And with that, the room burst out with a round of supportive laughter. It felt to me like a group hug, as if the crowd were saying, “Right On. Tell Him How It Is, Brook.”

Byers didn’t directly attack anything Emanuel said earlier in the day, and he did stress how important it is for entrepreneurs to work closely with payers on measuring the value of new products. But if the crowd of several hundred people in a comfy Harvard auditorium really wants to make a difference in creating innovations for personalized medicine, I’d suggest they’d listen carefully to Emanuel, and a number of health economists who are making basically the same point. The U.S. healthcare system is badly broken, and it can’t go on paying for all these wonderful life science innovations the same way it has for the past 30 years.

As I said in this space a couple weeks ago, I’m inspired by some outstanding personalized medicines that have been approved by the FDA for cancer patients in the past few months. These are superbly effective drugs for small, genetically distinct populations of patients that are worth the hefty price tags they are commanding. These treatments are paving an important road scientifically, and with regulators, which other drugs ought to be able to follow for years to come.

But these innovations need to be taken in context. The U.S. now spends $2.6 trillion a year on healthcare, and that number increases by $100 billion a year, as Emanuel pointed out in one of his recent New York Times columns. That means the U.S. healthcare sector, by itself, is roughly equal in size to the economy of France—the fifth largest economic power in the world. To shave even 1 percent of U.S. healthcare spending per year, you need … Next Page »

Comments (6) | Reprints | Share:          

Looks like Amazon’s pugnacious bet on national sales tax reform is paying off.

The Seattle company (NASDAQ: AMZN) says it is strongly supporting a proposed national law that would force online retailers to collect local taxes on more of their sales, ending a longtime loophole originally meant to help catalog businesses. The National Retail Federation, which has battled with Amazon on the sales tax issue, also is on board with the bipartisan Senate proposal announced today (the federation represents lots of brick-and-mortar retailers).

So how’s that a win? Amazon has gone to some pretty extreme lengths to avoid being deputized as a tax collector for state and local governments, insisting that its shipping centers are different companies and even shutting down entire networks of third-party sellers when state lawmakers pass “Amazon tax” bills.

That behavior has caused a lot of turmoil for the ecosystem of smaller businesses that rely on Amazon. One example is the story of Shopobot, a comparison-shopping startup that relocated from the San Francisco Bay Area to Seattle earlier this year specifically because Amazon axed its affiliate program in California.

But Amazon has said for a long time that it favors a national solution, rather than a hodgepodge of different state rules. Specifically, the company has supported something called the Streamlined Sales Tax project, in which states agree to a common set of sales tax definition and practices.

The common standards are important because each state taxes things differently—sometimes wildly so.

Cue up today’s bipartisan Senate bill, which uses the Streamlined Sales Tax program as a centerpiece of any national tax system for online sales.

So, while any retailer would certainly enjoy the fact that it didn’t have to act as a big tax collector, and could price its products a little better to boot, Amazon clearly knew the days of tax-free Internet sales weren’t going to last forever. It placed its bet on a national system, and made some pretty belligerent moves to reinforce that preference.

And it looks like that strategy is paying off.

There’s no guarantee that this bill will actually become law, of course—the federal lawmaking process is both arcane and volatile, and any tax vote will be a tough one in this economic climate. But it’s got a lot of the hallmarks of something that could pass.

An interesting side note: Shoppers in Washington state already pay sales taxes on Amazon purchases, because the company’s headquarters are here. But the state also says it’s only collecting taxes on about half of the online and mail-order purchases by people living here, and that adds up to some big numbers.

If the new Senate proposal becomes law, Washington officials estimate that state and local government treasuries could raise about $242 million annually. That comes at a time when the state has been cutting billions from spending on education, health care, and other expensive government programs.

Comments (4) | Reprints | Share:          

[Editor's note: Cross-posted from The Economist, 11/2/11]

New York Mayor-entrepreneur Michael Bloomberg, not known for shyness, recently proclaimed New York City as America’s new entrepreneurship capital, roaring past Boston in venture capital and soon to leave Silicon Valley in the dust as the “go to” destination for entrepreneurs. Indeed, the world media are awash with proposals to kick start entrepreneurship as a strategy for economic revival, with support for venture finance at the heart of many programs. Yet the title of Harvard’s Josh Lerner’s recent book, “Boulevard of Broken Dreams,” is no coincidence, because proclamations are one thing, actual success is quite another.

Fortunately, there is a lot of experience around the world about what works and what doesn’t. Here are some practical principles that the Babson Entrepreneurship Ecosystem Project have been identifying and developing for public leaders who have, correctly in my opinion, identified entrepreneurship as an essential plank in economic policy.

1. Be clear that the objective is to foster an entrepreneurial finance ecosystem, not to directly provide capital to entrepreneurs. Over time, a healthy entrepreneurship ecosystem makes available capital to ventures that deserve it, while denying it to ventures that do not. This does not mean that governments need to revert to selecting the deserving. This idea has regained currency recently, but we learn time and again (Solyndra anyone?) that it does not work. It does mean that the availability of capital, and other resources, needs to be part of a natural process in which the ecosystem elements—in this case, deal flow and capital—continually evolve and adjust to each other, a concept that is consistent with Smith’s “invisible hand.” But the concept goes further by suggesting that enlightened and skillful leadership can play a critical role in encouraging the evolution of a self-sustaining ecosystem, but leaders have to understand how and when to get in, and how and when to get out.

2. Stimulate financing, but stay off of ventures’ balance sheets. Presence of government and government-owned entities as direct debt or equity holders of ventures should be a red flag. The only reason government should be on a venture’s balance sheet is in the rare case when it is absolutely necessary to entice private, profit-oriented entities to get involved as the natural selector of investment targets, and in those cases, government should have a clear plan to get out. Governments can, as have Israel, Finland and some other countries, provide smart, off-balance sheet funding in the form of repayable grants, matching grants and so forth. But presence on ventures’ balance sheets ultimately leads to a conflict of interest between governments’ social priorities and obligations, and the need to provide a positive return to invested capital. Overall, there is evidence that a moderate amount of this kind of financing can be beneficial, but as it gets to be too great, the benefits rapidly turn into liabilities.

3. Make sunset clauses for financial support programs the rule, not the exception. Permanent, or evergreen programs of government-supported venture capital, loan guarantees, startup grants, angel tax credits and so on, risk becoming white elephants and/or political assets, not economic ones, and in the process risk squandering public funds. Sunset clauses, or “sell-by dates,” help focus policy-implementation programs on (a) achieving results, and (b) creating self-sustainability by building capacity and mutually reinforcing systems (for example, by showing private sector players that they can actually make profits.)

4. “Pulse” incentives to foster discovery. An implication of sunset clauses, in general, is that if providers and consumers of risky capital can “discover” that it is profitable to engage, then they will accelerate self-interested behavior when the “visible hand” is removed. Seeing if providers and consumers of entrepreneurial capital “discover” the correct pricing mechanisms to allow them to engage in a profit-seeking transaction is one test as to whether the problem is really a market failure or not, and is not just … Next Page »

Comments | Reprints | Share:          

The past week in tech headlines was dominated by our leading alpha geek: Microsoft co-founder and chairman Bill Gates. Gates stopped by the University of Washington to give a short talk about the future of computing, and how he sees cheap, powerful storage and processing revolutionizing everything from robots to disease eradication (the part about malaria went on for kind of a long time).

But the most interesting part of the evening was surely the Q&A portion, in which Gates sat on stage with the UW’s Ed Lazowska to field questions on just about anything from students in the crowd. Gates seemed to rather enjoy the give-and-take, even when a young woman asked him how she could get rich.

As you’ve probably read by now, Gates marveled at how strange it was to be a billionaire, and said that once you get past a several million-dollar fortune, it’s really just more responsibility about how to give it away. “Once you get much beyond that—you know, I have to tell you, it’s the same hamburger,” Gates said to laughs. The UW now has the whole lecture up online.

Elsewhere around town:

—PopCap Games mobile chief Giordano Contestabile reminisced about the inglorious past of mobile gaming, when all games on cell phones were basically hokey ways to get people to send premium-priced text messages. As Contestabile said on Twitter, “When mobile games were crap.” Now it’s quite a different story, of course, and Contestabile is one of the people in the driver’s seat pushing the boundaries of how games will evolve.

He’s also joining us Dec. 6 for Mobile Madness Northwest, our half-day forum presented with the Washington Technology Industry Association at F5 Networks in Seattle. Early Bird pricing only lasts until Nov. 15, so get your tickets now.

—Online real-estate brokerage Redfin added $14.8 million in venture funding, with designs on expanding the business into new markets around the U.S.. The round was led by new investor Globespan Capital Partners.

—Speaking of venture deals, we looked at September’s fundraising for Washington-based companies in technology, biotech, and clean energy and found a total of $32 million had been raised, according to data from our partners at research firm CB Insights. Medical companies led the pack, with $12 million for RF Surgical Systems and $10.6 million for Theraclone Sciences.

—More turmoil at Clearwire (NASDAQ: CLWR), which saw board member Benjamin Wolff resign. Wolff is a close associate of Clearwire founder and former chairman Craig McCaw. The Kirkland-based wireless provider has been on a roller coaster ride lately—mostly down—as it and majority shareholder Sprint figure out how to navigate Clearwire’s expensive changeover to a new type of broadband technology.

—The state of Washington has been cutting millions from education budgets in the past several years as its treasury deals with low tax revenue. So there was one spot of good news for students shouldering larger tuition burdens: The rollout of open-source course materials for the most common community and technical college courses, called the Open Course Library. The project is jointly paid for by the state and the Bill & Melinda Gates Foundation.

Comments | Reprints | Share:          

How’s the life of a billionaire? “Quite strange,” says Bill Gates, who fielded questions from University of Washington students on Thursday evening as part of a lecture on the future of computing.

Gates’ talk, at a packed hall in the UW’s computer science building, focused on some areas where he thinks cheap, powerful computing will have a major impact on society, including education, disease, and robotics.

Gates recalled spending time on the UW campus as a young man, back in the days when computers were huge, powerful machines locked up in big research facilities.

“At strange hours you could essentially break in and use computer time,” Gates said. “I never did get a degree here, or anywhere else. But fortunately for me, my addiction to computers became easier to satisfy.”

Given the chance to ask Gates about anything, students treated the evening like a visit with the oracle, asking the Microsoft co-founder to expound on problems with the political system and the tax code, predict the future of computer interfaces, and more.

Gates didn’t disappoint, giving long answers that included some glimpses at his personal life, such as meeting his daughter’s boyfriend’s parents over Skype and being such a bookworm as a kid that “I had to have a quota about how much I was allowed to read.”

The webcast will be archived online by UW, but here are the highlights from where I sat:

BEING RICH
A student from Beijing said her dream as a child was to be one of the richest people on Earth, so she asked Gates “what is one word of advice that you would give to someone like me to become someone like you?”

“I didn’t start out with the dream of being super-rich. And even after we started Microsoft, and the guys who ran Intel—Gordon Moore and those guys—were billionaires, I was like, ‘Wow, that must be strange.’ And so—it is, it’s quite strange,” he said to laughs from the crowd.

“But I think most people who’ve done well have sort of found something that they just are kind of nuts about doing. And then they figure out a system to hire their friends to do it with them. And if it’s an area of great impact, then sometimes you get financial independence,” Gates said.

“But wealth above a certain level, really, it’s a responsibility that then you’re going have to either, a.) leave it to your children, which may or may not be good for them, or b.) try to be smart about giving it away.

“So I can understand wanting to have millions of dollars, because there’s meaningful freedom that comes with that. But once you get much beyond that—you know, I have to tell you, it’s the same hamburger. Dick’s has not raised their prices enough,” Gates said to laughs. “But, you know, being ambitious is good. You just have to pick what you enjoy doing.”

MONEY & POLITICS
Asked if he thought there was a societal problem of wealth being concentrated in the hands of too few powerful forces with an outsized ability to influence politics, Gates pointed out that worldwide poverty is getting far better over time. But he also acknowledged … Next Page »

Comments (16) | Reprints | Share:          

I took the family to Boston on vacation in September. During the time away, I read Patrick Moore’s book “Confessions of a Greenpeace Dropout: The Making of a Sensible Environmentalist.“

Dr. Moore was one of the original founders of Greenpeace in the 1970s. I heard him speak recently. While he remains a passionate advocate for the environment, his commitment to science has put him at odds with many in the environmental movement. He seems to me to be a man who has the vision of a radical environmentalist-but now embraces unusual solutions that are more often associated with the radical right. He makes you think.

Moore, a Ph.D. in Ecology from the University of British Columbia, parted ways with Greenpeace in the 1980s when the organization began to take positions that, according to Moore, were more religious in reasoning than scientific. He said that the environmental movement had “abandoned science and logic in favor of emotion and sensationalism.”

Patrick Moore

One key example he cites of this anti-scientific reasoning was the Greenpeace campaign to ban the use of chlorine.

It didn’t matter that about 85 percent of our medicines are manufactured with chlorine chemistry or that the addition of chlorine to drinking water represented the biggest advance in the history of public health. By 1991, four years after I left, Greenpeace had adopted a resolution calling for an end to “the use, export, and import of all organochlorines, elemental chlorine, and chlorinated oxidizing agents,” stating, “There are no uses of chlorine which we regard as safe.” They might as well have called for a ban on living because it is not safe either.

A disillusioned Moore goes on in his book to make the case for forestry, hydroelectric and nuclear power, genetically modified food, and fish farming as being pro-environment. Like I said, he makes you think.

Of course, when it comes to ignoring science, neither side is without sin. I mention the trip to Boston, because during that time Republican Presidential candidate Michele Bachmann made her claims about the HPV cervical cancer vaccine. She said that the vaccine is a danger to society and could have negative effects on public health. She supported her claim by citing a conversation with an outraged parent who passionately argued that her daughter had become mentally retarded as a result of taking the vaccine.

Michele Bachmann

Now drugs and vaccines are not to be treated as if they were candy. They are controlled substances. If not used properly, they can be dangerous. But these vaccines have been studied in thousands of people around the world. Safety continues to be monitored by the US Centers for Disease Control (CDC) and the US Food and Drug Administration. More than 35 million doses of HPV vaccine have been distributed in the United States. The best science available shows that there are no serious safety concerns.

On the other hand, cancer is bad. The CDC says that most sexually active people will get HPV at some time in their lives, though most will never even know it. Every year, about 12,000 women are diagnosed with cervical cancer and 4,000 women die in the U.S.

I would guess that both Ms. Bachmann and Greenpeace advocates don’t like to be associated with each other. I would also guess that both are very committed to their causes and want to do the right thing-both for 12-year-old girls and for the environment. But in many cases, these advocates have let their passions overcome their intelligence.

Science is rarely clear. A really smart scientist once put it to me this way: “Is it possible that Martians will visit the earth tonight? Yes. But that doesn’t mean we should set another place at the dinner table.”

Definitive knowledge is in short supply. Throughout history, there are many examples of accepted scientific truisms being proved false.

We should make decisions based on the best available knowledge. Is it possible that there are unknown side effects from the HPV vaccine? Of course, but the best science available informs us that those risks are miniscule compared to the risk of cervical cancer. For my wife and me, this was a no-brainer decision when my daughter was that age.

As complex as medicine and biology are, the challenges in understanding the environment are no less daunting. We need to recognize that a lot of smart and able scientists are working diligently to better understand how to achieve environmental goals that, in the end, all of us share. I have no doubt that these scientists will learn things that will challenge conventional wisdom. We must continue to challenge ourselves and our understandings.

No one wants 12-year-old girls to get cancer. No one wants to ruin the environment. While we all have strong opinions on what is right, we must endeavor to be reasonable-and skeptical-even of ourselves. There are times when the facts, the science, or the situation changes and, as reasonable people, we need to change our minds.

Comments (3) | Reprints | Share:          

Thong Le, the well-wired venture investor at Seattle-based WRF Capital, is stepping up to become chairman of the Washington Biotechnology & Biomedical Association, the state’s trade organization that represents biotech and medical device companies.

Le will formally replace medical device entrepreneur Tom Clement in the volunteer chairmanship at the WBBA’s annual meeting, which coincides with Gov. Chris Gregoire’s Life Sciences Summit on Nov. 18. Clement, the founder of Kirkland, WA-based Pathway Medical Technologies, is now taking on a new entrepreneurial challenge as CEO of a couple different startups, Aqueduct Neurosciences and Cardiac Insight. He will stay on the WBBA’s executive committee.

Le, 35, has made himself into one of the best-connected people in the local life sciences community since he became a managing director with WRF Capital in 2000. At WRF, he has overseen portfolio investments in Corus Pharma, Alder Biopharmaceuticals, Halosource, Hyperion Therapeutics, Uptake Medical, as well as Accelerator, the venture-backed life sciences startup nurturer. He’s a graduate of Harvard University, and is the Pacific Northwest regional director for the Harvard Alumni Association.

“I’m really thrilled Thong is willing to step up. He’s a very smart guy, a careful thinker and has a lot of energy,” Clement says. Le says he doesn’t see any major strategic changes coming to how the WBBA does business. The role, he says, is about “providing a lot of guidance and support for the president.”

“I’m coming at an exciting time for the organization, with a lot of good things happening in the community,” Le says. “Despite the difficult economy, we’re still a bright spot within the economic ecosystem of the state. Our job is to figure out how we can continue to foster that. We want to help member companies be more successful.”

Clement has been chairman since August 2008, and has overseen the leadership transition at WBBA that occurred later that year when Chris Rivera was brought in as president. Le and Rivera have worked closely for years, not just through WBBA activities, but also through WRF’s investment in South San Francisco-based Hyperion Therapeutics, where Rivera was previously the CEO.

Here’s what Rivera had to say in an e-mail yesterday:

“He is extremely smart, creative and has tremendous industry connections. Since he is an investor in the sector, I think that he brings a different viewpoint to the WBBA. Much of our efforts have been to help support the growth of the sector in WA. We try to do this by the following; 1. Commercialization/Translational research—through our pro-bono consultation, we have helped >55 new companies this year alone, with Chris Porter, Stewart Parker’s and Christiana DeloRusso’s help. 2. Access to Capital—WINGS, VIP Forums and LSINW are our main vehicles. 3. Talent—recruitment, retention and development of the talent needed to grow the sector. 4. Policy—both in Olympia and DC. And, 5. Purchasing Programs—our members have purchased >$30M through our contracts and saved > $4M this year alone.

“Thong is and has been one of our community leaders, will bring some new ideas to the Association, and will help us continue to meet our Mission; help grow life sciences in WA state.

Comments (4) | Reprints | Share:          

The FDA has spent decades talking about how its job is to make sure all kinds of U.S. medical products are safe to use, and effective. Now it’s coming out with a new strategic outline on how it intends to do all that same stuff, while also spurring the development of more innovative drugs and devices that will help the U.S. hold onto its competitive advantage in the life sciences.

The FDA commissioner, Margaret Hamburg, today is releasing the 40-page overview with a decidedly non-adversarial title of “Driving Biomedical Innovation: Initiatives for Improving Products for Patients.”

While the full report has some defensive notes in it about how the FDA has already been trying to stir innovation for years through its 2004 Critical Path Initiative and other vehicles, it acknowledged a number of complaints that entrepreneurs, big companies, and investors have leveled against the agency for years. It cites the common beefs about how the agency can be unpredictable; not so good at helping small businesses navigate its processes; not exactly on the technological cutting edge; and inefficient. The FDA now says, after hearing input from various outside groups for months, that it wants to reform by improving its outreach to small businesses; creating a fast approval pathway for certain targeted therapies; improved data sharing; scientific training; and streamlining of processes and regulations.

It cites the familiar refrain to all industry observers about how the government and industry is pouring $95 billion a year into biomedical R&D, and getting fewer returns in the form of novel new products to help patients.

There’s a political backdrop to all of this, of course, as the President and the Congress are deeply worried about the stubbornly high jobless rate. Pharmaceuticals, biotech, and medical devices are three industries in which the U.S. is the undisputed world leader—yet there’s almost universal scorn for an FDA that has become so cautious and bureaucratic that it is stifling those industries and sending much of the U.S. competitive advantage overseas. Some prominent venture capitalists, and industry trade groups, have been pressuring people in the White House and in Congress for months to shake up the FDA, which I wrote about here back in April.

FDA commissioner Margaret Hamburg

The FDA talks like it has been listening. Hamburg wrote in the report that the agency “is working to position itself not only as a positive driving force in the ecosystem as a regulator, but also to facilitate medical product innovation.”

And Kathleen Sebelius, the U.S. Secretary of Health and Services of which the FDA is a part, added in a statement that: “The Obama Administration is committed to encouraging the entrepreneurs and businesses that are modernizing and strengthening our health care system. The innovation blueprint is another part of our effort to help businesses grow and keep Americans healthy.”

The blueprint is fairly vague in parts, and Hamburg notes in her introduction that it is an ongoing initiative and that it will be expanded.

One venture capitalist, Bob Nelsen of Arch Venture Partners, said he’ll need more assurance the FDA reforms are meaningful.

“It is a positive step that the FDA in recognizing that innovation matters. The verdict is out as to whether they will really change, so I will look for data. The FDA is under bipartisan pressure to re-think their policies that are leading the US to lose its huge advantage in medical devices to Europe, and [prompt] biotech investors like me to start investing in China,” Nelsen said in an e-mail.

“We no longer can justify investing in huge public health priorities like diabetes and Alzheimers, that cry for innovation investment, as a direct result of FDA policies that are muddled, unclear and don’t take patients into account. There is a dialog, and that is certainly a good thing, but as recently as two weeks ago Margaret Hamburg blamed the slow pace of drug approval on the lack of good science, not the FDA, which was a fall out of your chair moment, so we have a long way to go,” Nelsen said.

Still, the FDA document states repeatedly that the agency wants to be more supportive, and cites some of President Obama’s more business-friendly initiatives, such as the “Startup America” program which seeks to encourage high tech entrepreneurship as well as the “Strategy for American Innovation.”

Here’s the quick rundown on some of the programs the FDA has sketched out in its report, which it says should help spur more biomedical innovation:

—The FDA plans to establish a … Next Page »

Comments (9) | Reprints | Share:          

No particular group, right or left or somewhere else, is immune from the sense that change is accelerating at an ever faster pace with each passing year. The experience of too-rapid change, whether trivial or profound, is a characteristic of modernity. Information technologies are perhaps the sentinel sources and examples of what Alvin Toffler called “future shock” in 1970, right around the time that a young Bill Gates programmed a GE computer his school purchased using proceeds from a rummage sale. Information scientists cite Moore’s law, the idea that computing capacity doubles every two years.

We’ve all experienced the anxiety, frustration, and even resentment that accompanies the introduction of a new version of a software product on which we depend, or the realization that people younger than ourselves have adopted a new technology that makes the pace and style of their lives seem very different from our own.

Reservations about rapid technological change are widely shared regardless of political party or philosophy. In America the tension between approval of science and worry about the rapid changes it can bring bubbles up in special ways when moral or cultural choices seem to be involved. We’ve seen this tension play out time and again in our seemingly endless controversies about the teaching of evolution, reproductive rights, the moral status of the human embryo, the origins of the universe, and nearly all the issues of science that relate to human values.

Sensitivities about science are understandable. People rightly feel that high stakes are involved when science pushes familiar boundaries, and most of all when it seems that our customary and largely workable moral framework is being challenged. Americans seem especially touchy about such challenges. Ours is in many ways a deeply conservative country where the vast majority (generally around ninety percent) consistently report that they believe in God. The prominence of faith among Americans becomes even more striking when compared with modern western Europe, the historic source of America’s core Enlightenment values of rationality and science. There, the proportion of believers is around fifty percent. Americans admire science but also treasure traditional values, which are in some ways threatened more by science than any other institution; our attitudes tend to assemble at the extremes. In this sense, America is both the principal product and the main stage for the ongoing drama of the Enlightenment. Here are these universal values of truth, freedom, and equality founded on reason rather than the authority of a church or sovereign rulers. But is reason enough, or does it threaten those very values?

The ever-quickening pace of discovery in biology is an especially volatile source of “wedge” issues in our politics because it puts into question our familiar values about life itself. These questions are particularly clear when human dignity seems to be threatened, as critics … Next Page »

Comments (2) | Reprints | Share:          

Between the FutureM conference, Web Innovators Group, Mobile Monday, the Entrepreneur Walk of Fame, and the MIT tech festival t=0, there wasn’t a lot of time for Boston techies to breathe last week.

To keep you up to date, here are some high-level takeaways from FutureM, the sprawling MITX event that was really 50-plus separate events, focused on the future of marketing—and with a lot of Boston-area companies represented. This is just a small sample of what I saw and heard from a few panels and gatherings:

1. Ad tech sucks. For consumers, that is. Lots of startups and big companies are trying to make it suck less. That was the message from Sim Simeonov, the entrepreneur and angel investor behind Shopximity, a young Boston-area startup that’s trying to improve consumers’ shopping experience using display ads.

2. The frontiers of mobile marketing are automation, engagement, and transparency. Automating the marketing process is key in a world of near-unlimited Web content and cheap ad prices. So is getting (and keeping) people’s attention. “The trend we’re going to see is around making it more clear why [a consumer] would want to explore an ad,” said Lars Albright, a veteran of m-Qube, Quattro Wireless, and Apple. (His new startup is called Session M.) It remains to be seen whether a billion-dollar business can emerge from this sector, however. Albright would bet on Apple’s iAd network reaching $1B, while Paul McNulty of IBM’s enterprise marketing division (he’s from Unica) said, “I don’t know if [a marketing automation company] is the horse I’d bet on as the next EMC.” (I took that to mean because there are lots of different companies with complementary strengths, it’s hard to imagine one big category winner.)

3. “California is a one-night stand, while Massachusetts is a long-term relationship.” That was Senator Karen Spilka (D-Mass.) summarizing the views of a panel of entrepreneurs and investors on building companies in the Bay State versus Silicon Valley. “We’re still number one in education,” she said. “And number two in [venture capital] as a small state is pretty good.” (Alas, non-compete laws are also part of the long-term relationship here. Interestingly, Brian Shin of Visible Measures noted that his thinking on non-competes has changed, presumably from positive to negative: it sounds like he originally thought they would be helpful in retaining a core group of top employees in the state.)

4. Diversity in tech is a challenge and an opportunity. Investor Eric Paley of Founder Collective noted that young entrepreneurs in New York and Silicon Valley “can rattle off names of success stories.” Whereas in Boston, people don’t hear much about companies like EnerNOC, Acme Packet, EqualLogic, and Unica, “because we’re so distributed” across different sectors, he said. “It’s the diversity and the modesty.” Case in point: On the panel, Paley asked Brian Shin if he knew of Unica, the marketing tech firm that would be bought by IBM for $480 million last year, back when Shin was starting Visible Measures in 2005. “I didn’t know any company,” Shin said. On the other hand, he said that “because there is diversity, you can find [a mentor] who’s done something big in almost anything you want to do.”

5. Connecting students with startups, perhaps with VC or government support, is key to the state’s tech future. It’s a well-known issue: top kids go to school in Boston and then leave for the West Coast or New York to join hot startups, or they become business consultants. “We should be insanely aggressive about internships,” Paley said, for undergrads, grad students, and MBAs alike. That means championing broad efforts to get young people who are interested in entrepreneurship (there seem to be more and more lately) to work at local companies for the summer. That echoes something Jon Pierce told me a few months ago: “Working at a startup is the best education you can have as an entrepreneur.”

Comments (2) | Reprints | Share: