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IT leaders launch Innovation Thursday forum

U.S., ČR officials stress need for start-up support

By Michael Heitmann
Staff Writer, The Prague Post
February 20th, 2008 issue

Innovation is the new buzzword of the Prague business community.
If you don’t innovate, someone else will — this was the common narrative shared by company leaders, scientists and politicians at the inaugural meeting of the “Innovation Thursday” business forum Feb. 14. It was the start of a series of bimonthly meetings organized by the Tuesday Business Network, a Prague-based nonprofit.
The grand surroundings of the 17th-century Wallenstein Palace, now the seat of the Senate, belied the meeting’s frequent cries for innovation and out-of-the-box thinking.
“Make sure you are constantly challenging what you are doing,” said Jane Gilson, general manager of Microsoft in the Czech Republic. The biggest secret behind innovation is that everyone can do it, she said.
Only three basic conditions have to be fulfilled to make a new product a success: It has to be desirable to users, it needs to be viable in the marketplace, and it should be realizable using available technology.
“The IT industry is a great catalyst for innovation,” Gilson added. IT-driven automation then spills over into other industries, like retail. For example, in the United Kingdom, shoppers are accustomed to completing their own check-out and payment thanks to the use of radio-frequency tags at supermarkets. Every resident of Prague who has ever waited in a cashier queue only to have it close right in front of them knows how large an improvement that is.
These days, having a great idea is often not enough. When it comes to funding risky start-ups, venture capitalists (VC) often backpedal, said Yoav Leitersdorf, who recently became a VC himself.
“Early stage venture capital remains a problem worldwide,” he said. Pouring money into a start-up requires a disproportionate amount of risk for most VCs. And many VCs want to cash in on their investment quickly. Leitersdorf requires an exit route within a two-and-a-half-year time frame, for example.
Because VC firms avoid early stage companies, much of this funding is actually drawn with great success from taxpayer money — at least in the United States, said Charles Wessner, director of the board on science, technology and economic policy at the U.S. National Academy of Sciences.
There was much talk at the forum of how the entrepreneurial culture in the United States “is a little more alive and kicking,” as Leitersdorf put it. But one flaw that afflicts both the United States and Europe is that they still view each other as their main competitor, Wessner pointed out.
Europeans should not “feel bad” about missing the Lisbon target to become the most dynamic and competitive knowledge-based economy in the world. If anyone is going to reach that goal, it could be China, he warned.
All of Europe is facing a problem today because its people have, to some extent, lost their ability to take risks, said Jan Mühlfeit, Microsoft’s European chairman. Despite this aversion to risk, Mühlfeit remains cautiously optimistic:
“Be happy, but be a little bit worried,” he said.

Michael Heitmann can be reached at mheitmann@praguepost.com


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