Game Changer Insights Detail
5 big questions on innovation
Steve Hoffman, Co-Founder & Captain
Steve Hoffman is a virtual midwife to the future of humankind at Founders Space. “Captain Hoff” doesn’t just predict a world in which computers replace accountants and IOT chairs automatically adjust to your personal dimensions, but he actively selects and empowers the tech innovators who are shaping these kinds of revolutions. Named a Top 10 incubator in its first year of active mentorship, the Silicon...
Full profile »
How is your team changing the game within your industry sector?
We've been innovating on the incubator/accelerator model. Instead of just adopting the standard 'Y-Combinator' model, which is meeting start-ups once a week for 3 months followed by a “Demo Day,” we spent 18 months interviewing start-up founders and asking them what they'd like us to do differently. Here's what we learned:
a) Three months is a long time to wait for a Demo Day. Most start-ups apply to their accelerator several months in advance, and then if they get accepted, it’s another 3 months until they actually get to pitch investors on Demo Day. That means that many start-ups must wait 6 months or so from the time they first apply until they are in front of investors. In half a year, everything changes: competitors, market conditions, funding trends, etc. A start-up can miss their window by waiting. Founders Space solves this problem by having Demo Day at the end of the first month.
b) The second issue founders have with the traditional model is being committed to stay in Silicon Valley for 3 months during a program. This is a big issue, especially if the start-up is coming from overseas and has employees, family and customers back home. Founders Space solves this problem by having a more condensed, intensive program. Instead of having mentoring and training sessions one or two days a week for three months, Founders Space has them every single weekday for four weeks, followed by Demo Day. This way startup founders can move quicker and get the same benefits.
c) Lastly, the Y-Combinator model ends after three months, leaving start-ups on their own. It turns out start-up founders have more questions after Demo Day than they do before. But most programs end after Demo Day. Founders Space solves this issue by allowing startups to continue to attend all mentoring sessions and workshops for an entire year after Demo Day. This way startups can receive on-going support when they need it most.
We work with a lot of corporations who say they are innovating, but when we ask them to sacrifice revenue, they recoil. The one strategy that we propose to our partners is to reward innovation with virtual dollars. These dollars count as real dollars, but they aren't actual revenue. This way managers can justify spending time on innovative projects.
What are some of the biggest impediments to innovation in your organization or industry sector?
We often find that founders who have a good idea – but not a great one – will get too stuck on it and keep hammering on it, as rivals pass them by. Acceleration needs to be that, and we push them hard to identify the best ideas they have – and if they’re pushing a boulder up a hill, they should stop, and switch to something else. Also: Most people see a model or idea that works and then they copy it, making some incremental changes along the way. True innovation means rethinking everything and challenging all the assumptions you have.
You need to question every aspect of your business. Why do we do it this way? Why is this the model? What if we tried this? And then you have to take risks. You have to be prepared to fail over and over until you discover a new way of doing it. Most managers in large corporations are risk averse. That's how they got to the position they are in. They don't want a series of failures attached to their names, so naturally they go for the safe bets. But safe bets don't transform a business. Risk does.
How has innovation become engrained in your organization's culture, and how is it being optimized?
When we started Founders Space, we felt that we had to develop something new. There are thousands of accelerators out there, and we didn't want to just follow the herd. So we've been constantly experimenting and pushing ourselves to come up with new ideas that get better results for ourselves and our start-ups. It's a continual learning process, as we change and improve our model and program every quarter.
What technologies, business models, and trends will drive the biggest changes in your industry over the next two years?
The startup ecosystem is constantly changing. Large corporations are now jumping into the startup game in a much bigger way with open innovation, intraprenuership, incubators and funding. We are launching new services to partner with global corporations and help them collaborate with startups. This is the biggest change we see on the horizon, and it's the biggest opportunity. We just launched a new service called Founders Edge, which does exactly this: http://www.FoundersEdge.com.
Can you share a specific innovation strategy you’ve recently encountered which you find compelling?
It’s simply inevitable that machines will replace the jobs we do – blue collar; white collar; every collar. Surgeons are going to be replaced by robots, which will do the procedure precisely the right way every time. The tax code is a system of laws to follow and optimize – so there is no reason an algorithm can’t do it far better than an accountant. Legal contracts can all be written by computers. We will get to a very interesting point in society where people will have to ask themselves – what unique value can we provide? One wonderful impact will be in longevity. They are building nano-bots which we can put into our body to repair organs; and smart pills that can measure all the bacteria in your digestive tract, and tell you precisely what drugs or foods you need to take to be healthy and live longer. Ultimately, we will be upgrading our bodies; even our genetics.