by Greg Neichin
| February 29th 2012
What types of “innovation” should markets and society value?
What types of products, services, and businesses can justifiably be labeled as “innovation”?
I mindlessly use the word “innovation” tens of times every single day without pausing enough to ponder these fundamental questions. Heck, I’ve helped architect a product called i3 for “insight into innovation”, regularly assist clients build “innovation sourcing” teams, and help host a conference with an “innovation showcase” (don’t forget to join us in San Francisco on March 26-28th!). I really should have a thoughtful opinion here.
On one hand, having spent most of my career as an entrepreneur, I think that there is a fair argument to be made that the answer to the question, “what is innovation?” should be “who cares about semantics!” Let’s go out and build new stuff. If it replaces the old stuff, makes for a profitable business, and nets a good return for investors, we can call it whatever we want.
On the other hand, I think we, especially in some corners of the U.S. entrepreneurial community, have forgotten what innovation truly looks like. Jon Gertner presents his case for a definition of “innovation” in this …
The Solyndra debacle is no surprise to this cleantech venture capitalist. The inherent conflict between trying to get money out of the U.S. Treasury as quickly as possible to stimulate the economy and, at the same time, have government agencies that are ill-suited at making business decisions do just that was nothing other than a recipe for disaster.
Anytime a government program is giving money to the private sector with the intent of getting the money back, the program is doomed to failure. Bureaucracies, politics and the lack of a profit motive simply don’t allow government to succeed in business. Anyone who was surprised that politics played a role in the loan decision for Solyndra (and almost certainly other awardees) is very naïve.
Even if, by some miracle, the government could make good business decisions void of political influence, such programs are still doomed to failure because the public and media won’t allow for even one loan or investment to fail. In venture capital we make investments that don’t succeed and we fail often. Yet, we are still successful on the whole. Our successes more than compensate for our failures. The government has no ability to operate this way. Even if a program like the DOE …