Why Ukraine Needs Entrepreneurs KnowledgePassion FireAnatomy of an Entrepreneur
Agenda: Entrepreneurship & Innovation Potential: you have to do something with your potential The myth about “good ideas” Why US continues to lead the world in innovation? Other examples: Israel, India, Ireland… How Silicon Valley drives innovation Criteria for driving success? The “Developing” World Where is Ukraine today? KMCore
The Myth about Ideas? No shortage of ideas Ideas can come from anywhere Innovation is the “profitable implementation of ideas. Actual implementation of ideas that create social and economic value Example: Google – 20% of engineers time allocated to work on personal ideas #1 success factor: management team which can drive growth
The Case of Silicon Valley Long standing “Culture of Innovation” (does this exist in CIS?) Silicon Valley has 20% of the world’s software/hardware firms Ranked #1 for World Competitiveness 800 US VC firms - 70% in Silicon Valley More than 30 Angel Investor Groups planting seeds Silicon Valley reinvents itself: clean-tech, green-tech, biotech….
Entrepreneurship in Silicon Valley The GDP in Silicon Valley more than 3X national average 1% of US population generating 5% GDP Best conditions to commercialize ideas regardless of social status or background 2009 Global Insight study: VC backed companies created 12.1 million jobs - generated $2.9 trillion revenues Unique complex, innovative capability - financial, economic and social ties
The Developing World Developing world approaching rich countries for innovation New business models, no legacy – new types of innovation 22,000+ multinationals based in developing world Multinationals expect 70% growth in developing world 40% growth from two countries: China and India 100% of university graduates in India fluent in English Largest English speaking country in the world? CHINA More internet users in China than entire US and all of EU Wipro India reverse outsources to Egypt But ! Renault and Indian partner to build cheaper ($2199) car than Nano Tata Nano $2500
Why Technology is Important – some Facts India – more than 10 million trained IT specialists Taiwan – technology makes up 50% of the economy Ireland – exports $1B of Software China – attracts more foreign direct investment than US Israel has more than 4000 tech companies and 100 VC’s Israel has 70 companies traded on NASDAQ US venture capitalists invested close to $18 billion in 2010 Combined revenues of companies created by the VC industry contributed 17.6% of US GDP in 2009
USA Still Attracting The Best Talent 1/3 of silicon valley engineers skilled immigrants Many become future entrepreneurs Ecosystem of VC’s, investment banks, law firms, consultants and accounting firms Complex relationships with global giants such as Google, Intel, Cisco, Hewlett Packard People “incubated” in large companies, go and start new companies – often competing or innovating (creating a cycle of innovation)
Global US Companies Founded by Immigrants Intel Corp. - Andy Grove – Hungary Google - Sergey Brin – Russia Sun Microsystems - Andreas Bechtolsheim - Germany eBay - Pierre Omidyar - France Yahoo - Jerry Yang – Taiwan Paypal, Slide - Max Levchin - Ukraine
Ukraine Should Be Interested inEntrepreneurship and Innovation! Promotes productivity and economic growth Addresses societal needs Supports national and global markets Creates new, high-value, knowledge based jobs Creates new wealth (regardless of social status) Advances competitive advantage Creates a higher standard of living
Government Policy Impact on Building an“Innovation Society” Promoting competition, stimulating small business Creating conditions for attracting investment Encouraging internet deployment Improving Telecom/Internet infrastructure Education system producing specialists required by business Proactive: Ireland, Israel, India even Russia (Skolkovo?) So, how much is the Ukrainian government doing?
Innovation is a critical factor of competitiveness and growth for Ukraine Conditions should be created for venture capital and entrepreneurial activity to thrive Incubation and support of small businesses will drive innovation Ukraine has to compete globally for financial and intellectual resourcesThe Road Ahead…
Designed by Apple in California.. but… Assembled in China?
Will Ukraine in the the next 25 years… …Decide to competewith China on an ‘Assembly Economy’?
…Or “compete”with California on a ‘Design Economy’?
Where are Ukraine’s Silicon Valley, Stanford, Google, Apple …?Google Stanford KMCore USA Oracle
Through Creation and Support of Small Business and Entrepreneurship We can and must foster an “Innovation Culture!” ‘assembly’culture ‘design’ culture
Here’s to the crazy ones, the misfits,the rebels, the troublemakers, theround pegs in a square hole, theones who see things differently.They push the human race forward,and while some may see them ascrazy ones, we see genius, becausethe people who are crazy enough tothink they can change the world, arethe ones who will do it. Apple Computer advertising, 9/27/97 (quoted from Guy Kawasaki’s book Rules for Revolutionaries)
KMCoreKM Core is a Technology Investment Company based in Kyiv, Ukraine whichcapitalizes on the history of science and R&D in Ukraine, Russia and CIS.We believe that innovation exists everywhere and strive to turn potentialinto successful and growing businesses. I invite you to visit our web-site to see our portfolio of investments www.kmcore.com