Copyright 2011 The FactPoint Group
March 18, 2011
Prepared for VIA’s Exploring Social Innovation program
San Francisco and Stanford University
Tim Clark, Partnerwww.factpoint.com
+1-650-233-1748
Exploring Social Innovationin the San Francisco Bay Area
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Agenda: Silicon Valley Goes Green and Social
What is Social Innovation? VIA’s Ties to Social Innovators The Recipe for Silicon Valley—including Stanford
UniversityThe PayPal Mafia: Networking and Mobile
Entrepreneurs Mixing models: How Silicon Valley goes Social Trends in Silicon Valley Is the Future Social? Q&A
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FactPoint Background
Help high-tech clients identify and address market opportunities. Founded in 1992.
Custom research, not reports, focused on specific benefits (ROI/TCO)
Areas of focus: Cloud computing, open source software, security, cleantech, financial studies.
Asian clients: Hitachi, NTT Data, NTT Labs, NEC America IBM Japan Nomura Research Hewlett-Packard Japan Fujitsu Research Ricoh
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What is Social Innovation?
Social enterprisesMicrofinance
Kiva Microplace/eBay
Social entrepreneursSocial sector innovationCleanTech/ Green
businessCooperatives
Buyers Sellers (agriculture)
Social mediaFacebookMySpaceTwitter Wikipedia YelpBlogs and wikis
User Generated Content
Yes, freeBut quality?
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Cloud computing: [Every thing]-as-a-Service
“A style ofcomputing in whichdynamically scalableand often virtualizedresources areprovided as aservice over theInternet. Users neednot have knowledgeof, expertise in, orcontrol over theTechnologyinfrastructure in the"cloud" that supportsthem.“
-- Wikipedia
Source: Appirio, 2009
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VIA’s Social Innovator connections
Tom Lo (former board member)
Then
Now MicroPlace (eBay
company) Invest wisely. End
poverty.
Andy Cohen (former board member)
Tom Fricke (Indonesia, 1974)
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The recipe for Silicon Valley Intellectual capital, initially from universities such as
Venture capital 3000 Sand Hill Road, Menlo Park Invest in start-ups, aiming for 10X returns Cash out in IPOs or acquisitions (UC-
Berkeley)
People: Innovative, talented risk-takers Technical, marketing or business skills
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Companies with Stanford roots Hewlett Packard—Bill Hewlett, David Packard (1939) Cisco—Started with Stanford network (1984) Netscape—Jim Clark (1994) Yahoo!—Jerry Yang, David Filo (1994) Google—Sergey Brin, Larry Page (1998)
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What does these people have in common? Sergey Brin, Google co-founder Jerry Yang, Yahoo co-founder (ex-CEO) Andy Grove, Intel co-founder Elon Musk, PayPal and Tesla co-founder
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Waves of innovation The Internet wave—Netscape, Yahoo, Google (mid-1990s) The dot.com bust (2000-2001) The Web 2.0 wave / social media Mobility wave: SmartPhones and iPad (tablets) CleanTech Social Innovation
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PayPal Mafia: Mobile people, personal networking PayPal CEO/Founder Peter Thiel earned $68 million from
eBay buyout. Invested in Facebook, LinkedIn, Yelp, IronPort Engineers and web designer Chad Hurley, founded YouTube. Elon Musk, forced out of PayPal after losing an internal fight,
co-founded Tesla Motors and also founded private space exploration company SpaceX.
Engineer Russel Simmons and Jeremy Stoppelman, VP of Technology, founded Yelp in 2004.
Product manager Premal Shah became founding president of Kiva.org
EVP Reid Hoffman founded LinkedIn in 2002 and was an early investor in Friendster, Six Apart, Zynga, Flickr, Digg, IronPort, Nanosolar, Ning, Technorati, etc.
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Trends in Silicon Valley Consolidation—big companies grow by buying smaller ones Cloud computing—Software-as-a-Service (SaaS), On-
demand Open Source—Users get source code to software Mobility—Beyond voice and data to mobile data Green IT—Save the environment, save money CleanTech—Electric cars, solar, energy conservation, etc.
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Open source’s appeal: It’s not only about costCost counts, of courseFor customers, access to code eases integration
issues.Some see code access as an insurance policy
against their vendor going out of business.Search for commercial open source business
model fixated Valley in last 2-3 years.
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Mobile computing: Smartphones and iPads
Smartphones are boomingApple iPhone—Most covetedGoogle Android—Growing fastest RIM Blackberry—Market leader for number in usePalm—Relaunched by Hewlett-Packard for tablet too
Apple iPad Boom in a category that has often failed before Many copycats
Specialty devices Amazon Kindle
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Green IT: Sprinkle a little Green on software Web meetings: Adobe,
Cisco Webex, GoToMeeting Power management
software: Cassatt --sold Automated systems
management: KACE --sold Digitize paper processes:
SpringCM on Accounts Payable
Telework: Secure remote access and workflow—SonicWALL, Adobe
How telecommuting pleases workers… More flexibility Less stress Work-life balance Control of time Lower commute costs More time at home
…and employers too Lower absenteeism Higher productivity Better job satisfaction Higher retention rates Lower training costs Easier recruitment SonicWALL, 2008
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Silicon Valley Goes Green and Social
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How Silicon Valley can go green and social
Software engineering talent Venture capital financing Entrepreneurial talent Political/governmental savvy Global market
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Barriers in Silicon Valley
High costs Global competition—China in solar Manufacturing issues
Labor costs Supply chain
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Mixing Models: How Silicon Valley goes social Hewlett, Packard and Moore Foundations Google.org—is it CSR or philanthropic? eBay co-founder Pierre Omidiyar, Omidiyar Foundation Cypress Semiconductor, T.J. Rodgers, incubated and spun
out SunPower, solar company Applied Materials, Santa Clara, chip equipment to solar cells eBay acquired MicroPlace (micro-finance) VIA: Nonprofit runs for-profit operations in travel, typesetting
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Where the green companies are
AutosTesla Motors, Palo Alto, manufacturer of electric carsBetter Place, Palo Alto, recharging stations for electric cars
Energy efficiencyNovaTorque, Sunnyvale, efficient motors (ex-VIA founder) People Power Co., Palo Alto, open source software to manage energy use of appliances
Smart grideMeter, San Mateo, software for smart grid dataSilver Spring Networks, Redwood City, hardware and software for smart-grid networksTrilliant, Redwood City, technology for smart-grid communication
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Ways to go Green
Energy generationBloom Energy, Sunnyvale, on-site power generation using fuel cells
SolarAusra, Mountain View, large-scale solar panels (acquired February 2010 by French nuclear company Areva)Akeena, Los Gatos, installs solar panels SolarCity, Foster City, installs solar panels Solyndra, Fremont, manufactures solar panels
Green building materialsSerious Materials, Sunnyvale, energy-efficient drywall, windows,
Food materials World Centric, Palo Alto, biodegradable containers, utensils
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Lessons from Silicon Valley There is no stigma in failing. Instead, what did you learn? Serial entrepreneurs are valuable—and pampered It’s a small, small town—personal connections matter With venture capital, you must build the business model and
the technology to scale. Small is not beautiful. Doing Well vs. Doing Good—Can they be the same? Location matters:
Irish Innovation Center, San Jose: Danielle McCormick left Dublin a year ago to found myCubi.com. "If you want to create a global brand, you have to be in Silicon Valley."
VCs hate to travel—poor, poor Chicago
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How Stanford University fits in Source for engineering talent Source for business talent Center for Design Research—design for extreme affordability Center for Social Innovation
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Questions for ESI participants Is failing in a social enterprise a negative? Where do you find personal connections for social
enterprises? Must a social enterprise scale/grow large to be successful? Can you do well while doing good? What would you do after your first social enterprise
success?
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Exploring Social Innovation
ThanksThanks
Tim Clark, [email protected]
+1 650-233-1748