The Tough Get Growing: How to Succeed in a Down Economy
11/16/2009 6:00 PM KresgeBo Fishback, VP, Entrepreneurship, Ewing Marion Kauffman Foundation; Eugene Fitzgerald, '85, Merton C. Flemings"SMA Professor, MIT Department of Materials Science and Engineering; Helen Greiner, '89, CEO, The Droid Works; Daphne Zohar, Founder and Managing Partner, PureTech VenturesDescription: Stay calm, stick with your vision and business fundamentals, and you'll survive and perhaps even thrive in rough economic times, counsel these entrepreneurial aces. In a conversation with the Kauffman Foundation's Bo Fishback, panelists reflect on their experiences bringing novel tech products to market and new companies to fruition, in good times and bad.
Daphne Zohar attributes much of her company's success to its unusual approach: PureTech Ventures is an institutional entrepreneur that "starts companies from scratch, backwards, looking for an unmet need." Her team investigates thousands of technologies brewing in academic labs, then, says Zohar, "we brainstorm and come up with ideas ourselves, forming a company in a proactive way." Zohar's group seeks out the very best researchers from the start -- the first step in building what she calls an "entrepreneurial trinity: people, money, technology." Zohar has been starting companies since she was a teenager, and is relatively unfazed by the current crisis. PureTech is bullish enough to have started a hair follicle company for such disorders as baldness and acne. It's "an area where there are no solutions, but it's clear that if there were something, a lot of people would be happy."
As a veteran of a half dozen startups, Eugene Fitzgerald has developed a healthy respect for macroeconomic cycles. The contraction of funding opportunities in the current climate may not be such a bad thing. "When you're in a phase with cheap capital around, you could form an idea incomplete on the technological level, and run with itCheap capital biases people toward selling their vision alone." With investors hard to come by, entrepreneurs will have to ratchet down their expectations, and "build companies the old fashioned way, over a longer period of time." A recession focuses people on researching and developing an idea so it "will sell tomorrow." Fitzgerald also sees "lots of opportunity during a time of gigantic changes," if entrepreneurs can remain fixed on an idea, settle for growing slowly, and reach that "magic point" when the economy starts to leap back.
As an 11"year"old Star Wars fan, Helen Greiner was "enthralled by robots." When she started her first company right out of MIT in 1990, she had high ambitions but little commercial know"how -- Greiner lacked even a business plan -- and she saw almost a decade of hard knocks before securing venture capital for iRobot. During this period, which taught Greiner "the value of cash," she partnered with Fortune 500 companies, and found work with DARPA and military contractors as well. All of these proved invaluable opportunities to learn about manufacturing and customers. When Greiner finally introduced her mainstream product, the Roomba vacuum, in the midst of recession, she encountered widespread skepticism. Says Greiner, "If you look at the market opportunity for robots when we started, you would have said zero." But she notes that with disruptive technologies, you "have to use a little bit more imagination" and "do a lot of evangelizing rather than just selling."
About the Speaker(s): At the Kauffman Foundation, Bo Fishback's responsibilities include developing and advancing transformative programs that strengthen entrepreneurial engagement in the economy and help entrepreneurs succeed.
Fishback joined the Kauffman Foundation in 2006 as a director in the advancing innovation area, where he studied the country's best business accelerators and university"based commercialization programs. In 2007, he joined Kansas City, Mo."based BioMed Valley Discoveries, a translational research and development organization affiliated with the Stowers Institute whose mission is to translate basic biomedical research into applications that improve human health.
Fishback has been involved in a range of entrepreneurial initiatives. He is a founding team member of Orbis Biosciences, a drug delivery and particle fabrication company. Fishback is also a co"founder of Lightspeed Genomics, a next"generation genome sequencing company that was spun out of a research program at MIT. In addition, Fishback developed the Equity Simulation Tool, OwnYourVenture.com, an educational tool aimed at helping people understand the impact of raising equity financing.
Fishback received his B.S. in Biomedical Engineering from Southern Methodist University and earned an M.B.A. from the Harvard Business School.
Host(s): Alumni Association, MIT Enterprise Forum
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