Innovation

As I get closer to a go/no-go decision on a project, I’ve been thinking about the difference about my vision for the project and the supportive innovations to enable the core innovations

The vision combines (in unequal parts) product, core innovation as I imagine it, the application of that core innovation, design, marketing,  developer ecosystem, and business development. The core innovation enables everything else, but it’s the application of the innovation that makes it meaningful, useful, and in this case, fun.

This week we’re testing initial approaches to the implementation for our specific application, and that’s where we’ll develop the enabling innovations, which is basically where the rubber meets the road.

The difference is that the enabling innovation happens at the source of real problems only encountered in the making of something, and in a project like this just getting the essence of it right isn’t enough; it also has to be safe, the components have to be cost effective at volume, and it has to produce a result that’s as good or better than people expect.

Over the past 30 years the US has outsourced so much tech that we no longer make most of what it appears we need in this project. So when we outsource the manufacturing of, say, computer chips  and microcontrollers, we also lose out on the innovations developed during new designs and even the manufacturing processes–where the rubber meets the road. And this is the fun part, which means we’re missing out on some of the fun of developing new things.

Everything is cheaper than if it were made in the US (likely), but we also don’t fully know what the conditions are in the plants that make them now–I have a lot to learn about that in a short time. This is old news, but it’s new to me, and I’ll write a bit more about what I learn in the process.

Technology for Tech’s Sake

I’m a technologist and I spend a fair amount of time every day thinking about, researching, or testing new applications of technology.

So when I say you don’t need certain technologies, or can do with less, it’s not because I’m out of touch, certainly, or don’t know the arguments for applications of tech, or because I’m biased for or against tech: I’m not.

If I do have a tech bias, it’s toward utility, or utility vs today’s cost, downstream impacts, tomorrow’s maintenance, etc.

That said, The Atlantic published an article in 2017 about something that’s been on my mind a lot lately: do we really need to computerize everything?

Do we need an Internet of Things, and if so, how broadly should we apply the technology?

Do you really need your refrigerator to order replacement cheese for you?

Do public facilities need automated flushing, and is the solution causing different problems that effectively obviate the rationale for the original solution?

We’ve long been in the because we can phases of technology, where tech is incorporated into products for the primary purpose of appearing to be competitive, cutting edge, or, more rarely, useful. The author posits (without citation of stats):

“Toilets flush three times instead of one. Faucets open at full-blast. Towel dispensers mete out papers so miserly that people take more than they need. Instead of saving resources, these apparatuses mostly save labor and management costs.”

The answer, of course, is no, we don’t need to technologize everything, but we will, because tech companies and the media that covers them will it to be so:

“Technology’s role has begun to shift, from serving human users to pushing them out of the way so that the technologized world can service its own ends. And so, with increasing frequency, technology will exist not to serve human goals, but to facilitate its own expansion”

So how much is enough?

I just got off a call with a company I’m helping, and like all of us they’re experiencing a lot of technological noise from consultants, social media sites, ad networks, Google, and their own, un-curated digital creations in the form of products, product information, and a few dozen important marketing phrases.

What is important? It’s sometimes very hard to understand what’s important once the precarious success you’ve developed but don’t quite understand feels like it’s dependent on everything you’ve tried to far, when it’s all so interconnected. You’re too close to it when you’re in it, and it’s a dark, murky mess.

We design our lives this way, we choose the murkiness, slowly, over time.

I depend on my phone because I’ve designed my world that way, not because the dependency is also necessary. Connectivity is intrinsic to my way of working, because I can, not because it’s the only way to accomplish what I need to.

So how do we clean it up? How do we turn tech back into a tool to advance our needs rather than to merely accelerate its primacy?

Start over, start clean. Start with the core, without technical dependency, then build back up.

Take the sensors off the toilets and faucets–go back to what worked for hundreds of years. Cut extraneous language from your website. Narrow your messages to a single core message, supported by three or four tightly related and slightly expansive phrases that spark thoughts of benefits.

Get a flip phone. Leave the smartphone or tablet in your bag, or at home. How many emails need immediate responses? Not that many. Pull the smartphone out for the one emergency email, but otherwise leave it. Delete apps. Reduce, reduce, reduce, eliminate.

I’m designing a few versions of a new something, and I ask a few critical questions about each feature: do we really need it, how much does it cost, how does it increase complexity (each feature creates complexity and dependencies), and can we do without it? Is it tech for tech’s sake?

I can’t say I’m always on the side of what makes the most sense, because like most people I can buy into the arguments about better, faster, cheaper, easier to maintain, focus more on your work and less on the crap because the innovation saves us time and money.

But it’s not always the case, and sometimes it feels like we just need to stop.

Projects vs. Startups

Yesterday I spent some time thinking about the difference between my successful starts and my projects, which I’ll call R&D that never makes it to market.

The start is the most fun, and it can also be the hardest part; it’s certainly the most important:

talk with likely customers and figure out the market, understand the opportunity, develop vision, design the product, figure out the sourcing if it’s a physical product, figure out best methods and user interface if it’s a software product (and both if it’s both hardware and software), refine the product, find early customers, test, refine, improve, iterate all of that while you also develop the brand, the marketing language, figure out the best sales approach, sales system, sales language, customer support, etc.

During that time you’re setting up internal systems of communication, accounting, legal, HR, etc, but mostly you wing it until you have more than a few people.

And, of course, you have to figure out how to pay the bills. You can take an asset-backed loan like I did for the food company, or invest your own money (same), or raise money from investors–likely friends and family or angels at the super early stage, depending on the luck of your birth and path since then.

And you want to partner with the right people–hire the right people, start with the right people…getting that right throughout the life of the company defines the life of the company.

So last night I took an inventory of the companies and projects I’ve started. There’s a difference: projects never make it to the company stage.

A company (my definition–yes there are shell companies ) has customers, revenue, and employees depending on it for income. That could be you, or your first hire, or your co-founder. Otherwise it’s just a full-time R&D effort, likely self funded.

My projects, well. I’ve started a lot. Russ Ryan from ChiliSoft once said to me with some amount of frustration “you never finish anything.” That still bugs me to this day, because he was somewhat right. But that’s not my job; my job is to start things, I say to myself, defiantly. But not exactly. When you’re a founder, your job is to start something and set it up for a safe landing. You don’t have to land the plane, but it should have what it needs to get there, and it sure as hell needs to be flying.

I’ll bet a lot of founders disagree with that. For me, the job is to get it so it’s moving in the right direction: excellent product, broad but specific vision, branding, early customer base with no limit on the horizon, repeatable, growing revenue, a strong early team, and the capital to get it to the next stage, if not to profitability.

So my projects are a source of frustration and I’ve been trying to figure out exactly why I didn’t launch them. Here’s a list:

  • Project management. I developed this as an internal tool for Mission Research when we were initially building GiftWorks. It was terrible, but useful. Post a document or photo, make some comments, select who would be notified of the post with a link back to it, and that’s it. That was in 2002, before Basecamp and other PM tools. But it wasn’t our focus, and it just sort of died at some point, likely because it was a good idea but not the purpose of the company.
  • Focus. I developed this after leaving GiftWorks in 2008. I have ADD and get distracted by shiny things like the interwebs, so I built something that allowed me to turn parts of it off, track my activity, show me charts of just how much time I spent on FB and other sites, and it worked pretty well. But I didn’t have a model, and it didn’t work well enough that I felt I could release it. And I didn’t have a team–sometimes that sense of obligation to others pulls you through.
  • Jawaya. This was the collaborative search engine, and maybe the project that came closest to becoming a company. It surfaced your endorsed results to other people searching for the same stuff so they’d have to work less to find it. It was hard to explain, and I didn’t have a simplified way of showing it because it was complex and investors would ask “but why doesn’t Google just turn this on as a feature”, and of course Google never did, because it’s not their model and not simple.But my job was to convince investors and then users of the value of it. At its peak we had maybe 100 users and it wasn’t their default for very long. So I raised a little capital, used contractors, didn’t have employees, no paying customers, and it petered out. Not a company.

There are a half dozen other startup ideas I pursued. The mobile platform was the most recent, and that got zero traction with investor and was absolutely the kind of thing that needed investment first.

At the moment I have three projects: two are software, one is hardware and software. I am definitely moving the hardware/software project forward, but I’m not sure it will be a formal company (it certainly could).

The software projects are just to help me learn, but I’m not particularly passionate about either of them. They’re useful, and it’s fun to learn.

So what are the missing pieces for me to go from idea to project to startup company?

  • clear idea of the product and market (what are you selling, to whom, for how much, how often, etc)
  • capital to get it rolling, or high enough sales to get it rolling on its own
  • a team to work with. This might be the most important part for me, because it helps remind me of the importance of making things work.

Team + capital + product + market.

Reinvention

It’s been more than a year since the last loaf of bread left The Lancaster Food Company bakery. The half life of grief might be about six months, but the final final move-out wasn’t until February of this year; the main was November 30th of last year. So I’m crossing a threshold about now, looking forward more, but still examining what went wrong, what went right.

It’s a lot less painful when I remember three things: we did a lot of good for some people, I did everything I could, as did my partner, and people weren’t buying enough what we were selling fast enough.

The regrets pop up now and again, but less frequently, and I’m learning to just welcome them in, serve them tea, then send them on their ways. One regret is foundational: we didn’t ask ourselves what the best possible product line would be. I did question bread because of the reliance on plastic, but that’s not the right business model question, but this is:

If we’re going to make food so we can hire people and build a sustainable company, what is the optimal choice given shelf life, the time it takes to produce a batch, and cost of distribution?

The rest is standard–competition, branding, sourcing, etc.

The shelf life of our bread was 10-14 days, depending. Each batch took about 6.5 hours to complete. And with bread you have to take unsold product, then try to monetize it to recover losses. It’s a very, very tough business. As much as we loved the products, and miss them, not enough people were buying them frequently enough.

A better choice would have been a product with a shelf life of, say, 6 months, that took an hour or two to make. Product expiration risk goes way down, distribution opportunities go way up, distribution costs go down, and it takes less labor per batch. That’s one reason we added cookies–longer shelf life, shorter production time.

Alas, it’s over, and after another six months I might have enough clarity to document the lessons learned, but for now I’m looking forward.

Which leads me to “reinvention.” I don’t think reinvention is the right term; a person commits themselves to a path, accumulates knowledge, skills, bruises, and insights along the way, and then applies that and their core spirit and personality to a new path. And maybe they learn new skills that ultimately illuminate that path, but they’re still the same person with the same combination of vision, skills judgment, ethics, and drive, with perhaps more insight.

Me? I’ve been a songwriter and musician and still am. A sound engineer, a recording engineer, a gaffer. A dishwasher, waiter, paperboy, junk food retailer (in school), line cook, food deliverer, panel assembler (for 31 minutes), proofreader, computer designer, computer builder, computer deliverer, computer installer, networking technician, programmer, software designer, software salesman, software CTO, CEO, VP of Applications, marketer, project manager, bread delivery specialist, brand ambassador, taste tester, business developer, communications manager, garden manager, elected official, fundraiser, venture capital wrangler, Board member, volunteer, and likely many things in between.

I’ve done some of these very well, some poorly; some I’ve hated, and some I loved.

And now I’m working on what’s next, more than a year later, starting from scratch, but full of energy and ideas and moving ideas to plans, thinking about my future, my values, my people, what I care about and don’t, and the situations and steady state I’d prefer in my life.

Wouldn’t it be nice for someone to recognize your value and just reach out and find a place for you that works for everyone? From what I’ve heard from colleagues who’ve been through this, it just doesn’t work that way. You sometimes get lucky, but typically serial entrepreneurs are that way partly out of necessity, especially when you’ve had a failure. Nobody wants you.

So you pick up your pieces, find bits of duct tape and glue to get yourself back together, dust yourself off, and get back to work. You hustle. It’s taken me a while to get past the depression that comes with the grief, and now I’m cranking pretty hard on all fronts, but yeah–it’s been a grind.

I’m applying for jobs, but rarely get an interview, so I’m starting a consulting business while I develop a side project that has serious potential, though it’s not a serious contribution to the world. Maybe it’ll bring a bit of happiness somewhere, but it’s not a world-changing product or company.

I have a running list of what I’d like to work on next, and next to that a list of principles I’d like to live by, and so far nothing on the first list lives up to those principles. It doesn’t mean I won’t do them–I need to make a living. But I haven’t landed on the one thing that will get me up in the morning with energy, drive, vision, and a sense of mission. Not yet, anyway.

That said, I’m looking for someone who can help me develop a circuit board. Ping me if you know of anyone (preferably in Grand Rapids or Lancaster). I’m digging in again, and it’s always more fun to work with an expert than to try to become one. 

Immersive Entrepreneurs & What's Next for Me

I’m an immersive entrepreneur.

Not all are; some want to know the basics of what they need to know to sell their products or services, and that’s enough, which is a very good thing because it means a lot of business keeps moving that way.

But innovation can only occur at the point of the problem, which we can perhaps envision, but most of us learn more by working on it in real time, in the room, experiencing the problems and obstacles that serve as the sand in our oyster (broad discovery can happen anywhere, as can vision).

We have to touch it, toss it up and down, stare at it for hours, ask it how it’s doing, what its lineage is, how its ancestors were made, what went wrong and why, how often.

We need to know the smell of the room, the noise in the hallway, the motion outside the window–the environmental stuff when it’s relevant. The bottom of a delivery van gets hot to the touch on a hot summer day–you might not want to pack the floor with boxes of chocolate chip cookies (gooey learning by experience). What’s the innovation need in that case? Smarter packing, or a cooled or insulated van floor.

There are downsides to being an immersive entrepreneur, especially if you’re also an innovator with vision, working outside of your primary personal skills.

The Immersion
A year ago I started kicking an idea around a quite brilliant friend of mine had. He had a great start–the tech was functional and I know his history so I know it would only get better; everything’s programmatically possible with him.

It was exciting. I saw it as a broad platform for mobile development, with its own ecosystem of developers and third party software companies depending on it. So I dug into it, taught myself the tech, went deeper and taught myself some of the underlying tech, built a few samples, and learned what else was out there.

There were dozens of mobile dev platforms but no clear leader. I wondered why, and concluded there is a lot of noise in that market, none are easy from start to finish,  documentation generally sucks, and (this is the key) most of the platforms served as lead generation for services for themselves rather than focusing on making each customer/developer successful.

I found little appetite for investment because we’d have been a late entrant into a crowded, noisy market. And I had immersed myself completely: developed spreadsheet business models, charts comparing competitors, a new UI and UX for the product, designs, platform charts, and learned new frameworks, took courses, etc, etc.

I was all in.  But the tech wasn’t quite ready,  and my friend had no time outside of work and family, so the capital was crucial for creating time and space to work. With even a small success it would have been a significant win for investors, but I couldn’t make the case, possibly because of my five-year detour sinking all my dough into baking bread to hire people.

The upside?

Well, I learned the tech. I’m able to build React websites and React Native apps. I got back in touch with my inner Node and Express, and nicely satisfied with the Mongo wrapper Mongoose.

And I relearned the importance of immersion, as well as the cost: I risked my own time and opportunity to immerse myself in a project where I depended on someone else who wasn’t fully available, and, even knowing that, dove in deep to learn as much as I could, because the vision was powerful and the tech compelling.

Plus it tapped into two of the things that drive me: to make the world an easier place to live and work, and to build something valuable at a large scale. It takes a lot of belief for me to go that far into something, and I don’t regret it. There was something powerful there.

Growth Consulting
I immerse similarly when I help my client companies to grow; I can’t do that well without understanding their markets, how they make their products, who it helps and how, etc. They get that for free–I can’t work any other way.
 
My main gig is consulting to startups and established companies on anything from growth strategies (marketing strategies, sales systems, analytics) to capital and accountability. More on this later, once I get the new site up. This format is out of date. But I’m not 🙂

What’s Next
The ideas list is long, but there’s one project I’ve wanted to do for quite a while, so I’ve been digging in … (if you know what product I’m talking about please don’t mention it in the comments).

Years ago I had an idea for a common consumer product, designed in an uncommon way, that might scale because the underlying idea has broad applications. And as usual I thought it was unique, but found recently there were hobby attempts over 10-15 years ago, but none with a goal to ship a commercially viable product.

Going to market is a lot tougher than proof of concept.

So I’ve been immersing myself in the product design world once again, this time learning basic electronics, the joy and pain of Arduino, electronics supply chains, etc.

And of course I had to choose a product where I’m not an expert at the base tech! I have to learn everything and depend on someone else with experience and judgement to help me make the right choices. Again 🙂  Which is also fun, but one day I’d love to just make something without having to be an apprentice. Sigh…the generalist’s lament.

Anyway, we’ll call that a side hustle until I know I can pull it off profitably, which means costing out parts, assembly, regulatory stuff, etc, which means studying, learning, and asking experts. It takes time–that’s even before optimizing.

Ideally, what’s next will be something I really believe in that will help the world. The side hustle won’t address that, but it will be fun and profitable, so it’s a nice interlude until the next next big thing.

Momentum is Fleeting

p.p1 {margin: 0.0px 0.0px 0.0px 0.0px; font: 12.0px Helvetica}

Doors opened. Conversations happened. Approving nods all around. Emails flew about.   Lunches, then dinner some nights. People showed up and stayed. You soaked it all in, counted your cards, dreamt of what could be next. 

It was a grand time.

After the break, silence. Doors closed. Conversations stopped. No meetings, no nods. Emails dried up. Bag lunch, leftovers. Nobody showed up. You soaked it all in, no cards to count, wondering if this is how it all falls apart.

Momentum is fleeting. Don’t take it for granted. Those balls you were juggling are now hanging in the air all by themselves, stuck in the magic of the moment. The magic leaves, the balls fall down. And you pick ’em back up again and try to remember how you made it happen.

When you know there’s momentum, seize it. Carpe diem. Hoo-rah. Hop on the desk. Make your stand. Round everyone up and ask them to join you. Sign ’em up. Take pictures. Slap backs. Share apples. High fives all around. Keep that momentum going. 

Strong Opinions, Strongly Held

I really like smart, polite people who mean well. I’ve heard the phrase from a number of smart polite people that they believe in the phrase, “strong views (or opinions), weakly held.” 

When I first heard that I nodded in agreement and considered its wisdom. It implies a willingness to cooperate, to not be blinded by your own beliefs to the detriment of progress. 
And I’m sure it works in certain groups—collaborators working on improving the status quo–in certain situations. And yet it can sound like “yeah I have a strong opinion about this, but I don’t really care that much about the outcome.” 
There’s another group of people–a smaller group, I’d bet. These people have strong opinions, strongly held. 
Steve Jobs didn’t hold his strong opinions weakly. Nor did MLK. Nor did Sara Blakely, the now-billionaire founder of Spanx. Nor did John Lennon, or Basquiat, or Miles Davis. 
Weakly held opinions lead to weak outcomes, the muzak of outcomes. I don’t see the use of having a strong opinion about something but saying “meh.” 
How does that serve society, or companies, or movements? We need strong opinions, strongly held to change the world to the better. We don’t need to lower the bar to the acceptable outcome that weakly held opinions lead to. 
Be opinionated. Stick with it. And yes, be right, be informed, know your stuff, but don’t give in just because it feels good to the group. Leaders have a tough job, and holding strong, well-informed opinions makes that job a bit easier. 
It’s also the only thing that’s moved us forward: tenacious, visionary people with very strong opinions about their part of this world. 

Search & Privacy

I’ve been using DuckDuckGo.com (DDG) for search recently instead of Google because of its privacy features–it doesn’t track you or store your searches. And generally I find it to be useful, delivering relevant content better than or equal to Google’s relatively commercial content.

When I want to shop for something, I go to Google because it’s a strong engine for that–it’s a commerce discovery platform when it comes down to it. Or Amazon.

DDG doesn’t track anything, which is meaningful these days when every site and likely every agency tracks what you’re doing.

I still think there’s a space for curated search, which is what I attempted to do with the unfortunately named Jawaya, a social search or curated search engine of sorts. And I’ve been building a similar tool for myself as a side project that will approximate that. It’s much more powerful with a network of people curating search results. So I might open it up at some point to see if that still holds true.

I think the key with any future social media is that user-generated content should live with the user, and not the service. What I’m building will have a combination of local storage and a cloud database on a per-person basis, anonymized and accessible only by that user. They’ll be able to optionally contribute their work (curated content) to the network, which improves the results for everybody else. All of the data will be encrypted.

That data should be theirs and should be portable–it should be that way for Twitter, Facebook, etc. But their models don’t support that and I doubt they’ll ever move in that direction.

One of the reasons I’m using DDG is because it doesn’t track you, but one of the shortcomings is it doesn’t track you–you lose out on some of the positive results from that tracking, like relevant retailers finding you. It’s not a big loss.

But what would be powerful is an ad system where my anonymous data could be exposed to an ad network, and I’d get ads on that basis (the site would need a revenue source and I doubt people would pay much for it), rather than getting ads on the basis of data held by Google or others. I’m not sure I’m being clear here, but maybe it’s this, and maybe someone’s already thought of it:

  1. store anonymous, portable data, either locally or on the cloud
  2. send keyword data to ad network 
  3. ad network matches relevant ads
  4. site displays ads to anonymous browser. I think. 
So I’m keeping this in mind as I build a simple tool. I’m using React Native for the mobile app, React for the web app, and Node/Express/Mongo/Mongoose for the back end. It’s fun getting back into it, and especially fun to learn new tech by applying it to an idea I never quite finished. 
Oh–I almost forgot: go check out http://www.duckduckgo.com and give it a chance for a month or so. It’s run by Philly-based entrepreneur Gabe Weinberg, who also wrote a helpful book for startups. 

Self-Sustaining, Regenerative Tech Ecosystems

This is a repost from 2011. As I’m diving back into tech, it feels like a good time to revisit this as I’m now based in the MidWest, which, quite broadly, sports a lot of tech companies and some interdependent ecosystems.

The capital for startups is here, but I’m at the beginning of a raise and am not sure if it’s like Central Pa capital–slow, small amounts at low valuations–or competitive with NYC and the Valley.

* unfortunately we lost comments from the original post when I disabled Disqus a few years ago, from Arnold Waldstein, Brad Feld, and a few others. Brad referenced it in one of his posts on startup ecosystems. 

—————————

This post is conjecture from my observations and personal experience, without citations, and was about software ecosystems, though it could be applied to other sectors

For as long as I’ve been in tech I’ve heard the term “ecosystem” applied by people in regions outside of the Silicon Valley tech ecosystem to their own regions–aspirationally applied.

Most of them don’t have functioning, self-sustaining, regenerative tech ecosystems. 
What’s the difference? 
Pennsylvania’s a decent example of aspirational efforts to create 

self-sustaining, regenerative tech ecosystems (in the name of complexity, let’s give that an acronym: SRTE and pronounce it ‘SIR-tee’). 

I’m making this term up, though I imagine someone else has come up with a better descriptor. 
The Ben Franklin Technology Partners Program has created some successes and I like the people I know working in it, but it hasn’t created a single SRTE (to my knowledge). So what has it created? 
  • a form-heavy, long process for applying for inadequate funding
  • a bureaucracy for monitoring investments that includes documentation and reporting outside of the normal course of business
  • a network of support professionals and advisors, some of whom are very good and appropriate for startups, others who are not
  • a few great location-based services, including the incubator at Lehigh
  • a number of success stories, and more on the way, in addition to a greater number of failures, which you’ll see in the normal startup world too
But it hasn’t generated ecosystems. And I think that’s partly because its model is not set up to do that, though it’s what everyone would love to see.

*2019 note: Ben Franklin has really stepped up and is a now solid player in Pa– I’m proud to have started one of its success stories.

Let’s define SRTE.
A self-sustaining, regenerative ecosystem has these indicators:
  • new startups formed by former employees of earlier startups
  • new startups staffed by former employees of other startups
  • new startups funded by investors and/or employees of earlier startups with part of the proceeds from earlier successes
  • through at least two cycles
Nowhere in there is a long application process followed by inadequate partial funding with substantial non-standard reporting requirements. 
The most important quality: ‘regenerative’:
  • new startups formed by former employees of earlier startups
    • people learn by doing. The majority of startups fail, and without some level of exposure to building and scaling a startup, first-time founders have higher chance of failure
  • new startups staffed by former employees of other startups
    • this is the key indicator that you have a true “ecosystem”: when you have enough viable, growing startups that employees start hopping from one to another, it’s clear there’s something positive going on–there’s energy in the system when there’s healthy movement between startups.
  • new startups funded by investors and/or employees of earlier startups with part of the proceeds from earlier successes
    • the system generated dollars that can be plowed back into the next cycle of startups without seed/early stage capital from outside the region–that’s self-sustaining.
  • through at least two cycles
    • it must be long enough to get beyond the ‘not dead yet’ stage to ‘thriving’. 
So if you’re building a tech startup, why would you choose Pennsylvania or other “flyover” states? 
  • Family: home is home.
  • Relationships: building a new network of supporters elsewhere isn’t easy
  • Easy access to your market (true for some, not all)
  • You want to help create a SRTE and believe that it’s important and possible. 
Why would you choose to leave? 
  • Capital. PA ranks horrendously low in investing in tech startups, especially in mid-state companies.
  • Talent. You can find developers here, and you can find smart people here, but finding smart people who’ll take the risk of joining your early-stage startup is the tough part. We have a more conservative workforce that values stability, and I’ll suggest, perhaps wrongly, but in my experience the sense of urgency and ambition is less than what I see in the ecosystems like NY and the Bay.
  • Energy. There’s some some something going on in a true ecosystem, and you can feel it, you’re revived and propelled by it, you give to it and it gives more back, breaking all laws of physics along the way.
  • Partnerships. It’s tough to develop the relationships that lead to partnership discussions, and phone-based partnership development is simply not the same. It takes a lot more work and travel, and you miss out on the random, incidental introductions you get in the true ecosystem. 
If we really want thriving ecosystems in PA, we need to invest in those SRTE qualities. Philly seems to be on its way, but it’s missing significant capital flow,* and doesn’t have enough exits creating enough wealthy founders and employees to fund the next round of companies ( *this has changed significantly since 2011). 
One or two hits isn’t likely enough (Diapers.com was a great one for Philly and I’m looking forward to seeing whether that trickles down); some capital and employees need to be put right back into the ecosystem. 
I would argue against continuing the BFTP program in its current form, and instead choose two or three regions for a 10-year SRTE plan, and focus all energies on that. 
I’d choose regions with one or more recent successes, and organize capital and resources to create at least one successful, self-sustaining regenerative tech ecosystem. I do think having a loose incubator would help, but that it shouldn’t be some overbuilt institutional building, it should be an old tobacco warehouse or the like, and simply provide: 
  • hi-speed internet access
  • a Makerbot. Just for fun, if not actual prototypes. 
  • bunch of Arduino kits
  • printers, including a large-format printer
  • desks
  • 2 small conference rooms
  • bathrooms
  • a bit of a lounge area
  • common kitchen
  • scheduled evening classes by participants, local experts, and mentors
  • And some capital–not a huge amount per startup.
This would cost very little. Let’s do some math (this is off the cuff–flag it if it’s off substantially):
  • 20 startups
  • $25,000/startup (seed only for now)
  • space, etc, which if you live in PA, is cheap and available outside Philly and Pittsburgh. 
  • The list of stuff above
So roughly, $500k to invest, maybe $100k on top of that. Maybe. Likely less. 
To keep the promising startups going, you need additional investment, though I’d hope the startups would have a business model and revenue to shoot for. Quick pseudo-math:
  • half (generously) will survive
  • 8 will have it together enough to take additional capital
  • add 12 months of capital, say with average salaries of $60k
  • 3 people per startup
  • so rounding way up for taxes, marketing, etc
  • $250k times 8 = $2.0 million. 
So now we’ve risked $2.1 million per region. Out of that, we’ve created some jobs and opportunities, with 8 companies funded enough to prove out their models. Start the cycle again every year with a new crop. 
Of those, 4 will attract additional capital, 2 will shut down, and 2 will plod along. And of the 4, one will have a decent exit, and the others might be break-even or 2x to 3x. But the one that makes it will return at least 100% of the entire investment
So let’s do that annually for 10 years and round up to $3 million. I’d choose three areas: Lancaster, Harrisburg, and Bethlehem. That’s $9 million/year or $90 million total, all of which you’d likely make back. Maybe more–we’ve got some innovative people here. 
The one thing a light incubator like this creates is its own little ecosystem, where startups help each other, and you get the vibe and feel of a some-something going on. That helps, it’s energizing, and uplifting.
But I just get the sense we’re too process-oriented here, and have spread resources pretty thin to serve too many regions without much to show for it in terms of significant success and they key outcome we had hoped for: self-sustaining, regenerative ecosystems. But we could try. 

2020: When the EV Breaks Out

EVs make up a relatively tiny part of US auto sales, but the Tesla 3 outsold all other luxury cars and almost outsold the Toyota Corolla. It’s still too pricey, but it’s coming down this summer and there’s a new, lower-cost model on the way.

More Affordable
GM’s Bolt EV gets about 240 miles of range, and costs about $36,000 before incentives, which total $9,000 (including rebates in some states) until April, when the federal incentive is cut in half. It’s a great car, but for me the seat isn’t comfortable.  The range is enough to allay your range anxiety; you can drive from Lancaster to NYC and back without recharging, depending on how you drive. You can charge while you’re there in one of the hundreds of charging stations, many of which are in parking garages.

New and Interesting
Hyundai is coming out with the Kona, which has a range of about 240 miles; it’s like the Honda HRV, a small crossover with a good amount of space relative to the Bolt (guessing). Hyundai isn’t producing many of them yet.

Kia is expected to come out with the Niro EV, a close cousin of the Kona. Nissan just improved the range of the Leaf to 225 miles (optional), and the big news is VW announced that all car lines will have a long-range EV option.

EVs are Mainstream and Taking Over
In short, we’re here. Electricity is cheaper than gas, even at today’s low gas prices. 2020 will be the year the general public recognizes renewables are cheaper than fossil fuels. (If I were a responsible blogger I’d provide links, but alas).

Energy companies would be wise to move aggressively away from fossil fuels and toward renewables. They’ve been dabbling, but they’re not trying to disrupt themselves. That’s a mistake–they’ll become the Kodak of energy, in a sense, if they don’t move fast.

Used Market
You can buy a used 2013 Leaf now for $7,000, with a range for 80 miles–with heated seats! Every two-car family should get one for local trips. How often do you drive 80 miles in a day? 40 up, 40 back? No often, even on a day heavy with errands. You’ll save 75% on fuel, and have a peppy, fun, reliable relatively spacious second car for cheap.

Downside: Unemployment in the Auto Industry
The biggest negative impact will likely be on the US auto industry supply chain and after-market retailers. EVs have something like 18,000 fewer parts than gas cars. Gas cars aren’t going away entirely just yet, but fewer will be sold, and the decline is going to accelerate between 2020 and 2030 so rapidly there will be major upheaval in these markets.

Imagine a 20% decline in production of new parts–pistons, casings, bolts, screws, linings, exhaust, spark plugs, etc, etc, etc. They can’t simply shift production to electric motor parts–there just aren’t many parts in an EV.

Which means tens of thousands of people are going to lose their jobs–possibly millions–over 20 years. They should start looking for another job now, while there’s still time. It will be a sea-change shift, and we’ll be better off for it: better air quality and  water quality; less asthma and less disease caused by chemicals like benzene (from gasoline), etc. Gas stations should aggressively start adding charging stations –and lots of them–and cafes to capitalize on the longer charge times of long-range EVs.

Other Thoughts
The one benefit a gas car has over an EV is refueling time, which will change in the next several years, but right now it’s at least a 20-minute wait to recharge a Leaf to 60 miles. Cars with greater range take longer to fully charge; the Bolt takes an hour and twenty minutes. Hence the cafe opportunity 🙂

You can get a Tesla Model S for under $30,000, if you’re willing to buy used. It’s a beautiful luxury car, and happens to be electric. Fast, spacious, comfortable, and amazing. Sigh.

I sold my Leaf last year for $7k. I’ve driven a gas guzzling SUV (Ford Escape, 23 mpg) for road sales and I hate that I burn gas, but I needed the range and couldn’t afford a Tesla (and can’t see driving a luxury vehicle).

So, yeah, I’ve loved electric cars since the 90’s. I’m one of those slightly obsessed people and almost built my own with a local EV builder.  I look up prices every couple of days, read EV news, spot the EVs on the road, look at industry stats, etc. I’m addicted to this great idea finally coming to fruition. The first EV was built in the early 1900’s…it’s been a very, very long road to getting to public acceptance. And we’re just about here.

And yes I’d work in the EV or solar industry if I had the right opportunity. I’m super excited about micro-grids and the potential for people to organize their own power sources, cooperatively in neighborhoods. A friend of mine turned me on to some new ideas around that, and it’s exciting. Lots of hurdles, of course–local, state, and federal laws, working with physical stuff like, well, stuff you have to install.

EV Sites I read
Inside EVs (pure EV site)
Green Car Reports (mix of EV and Hybrid, not dedicated to EV, sadly. Hybrids burn gas–they are polluters and resource hogs. But better than full ICEs. )
EV-VIN  (current lease deals, links to other sites)

That’s what’s on my mind this morning.