Innovation Renaissance

Innovation Renaissance
Hjalmar Gislason
CEO, DataMarket

About Hjalmar
Started 4 companies in 11 years
Some have succeeded, others not
Currently: DataMarket (datamarket.net)
Never bankrupt, a few happy investors
Almost 100 man-years
A few million dollars in foreign currency

Agenda
Bubbles and Iceland
Why innovation?
Innovation Culture

1100 years of bubbles

Arctic trade bubble
First 300 years - incredible wealth
Sagas, ships, trade and treasures
Where did the money come from?

Arctic trade bubble

Arctic trade bubble
Debt of Venice to the Pope paid with unicorn horn!
Burst in the 1200s
Result: 700 years of misery

Herring bubble
1967-1969 herring disappears
Result: A few years of recession

Fur and fish farming bubble
In the 1980s
Result: Over investment in many rural areas

Dotcom bubble
You know this one (actually financial)
Result: 3-4 years downturn

Banking bubble
October 2008
Result: ???

Non-bubbles
1965
Exports: Fish

Non-bubbles
1980
Currency from: Fish, Aluminum

Non-bubbles
2000
Currency from: Fish, aluminum, tourism
not “export”

Non-bubbles
2007
Currency from: Fish, aluminum, tourism, banking
not “export” Banking ?

Non-bubbles
September 2008
Currency from: Fish, aluminum, tourism, banking
not “export” Banking ?

Non-bubbles
November 2008:
Currency from: Fish, aluminum, tourism
not “export”

Import-Export in short
Export: Fish, aluminum and happy tourists
Import: Everything else!

Iceland’s risk
When one pillar of the economy is hurt, our standard of living hurts equally
What if:
Fishing stocks dwindle?
Aluminum prices collapse?
Travel becomes too expensive?

No more bubbles!
We cannot afford another crash
(we don’t even know yet if we can afford this one)
Icelandic economy must diversify

Analysis
Resources
Fish
Energy
Land
Nature
Oil?
What else?

People
A major resource:
Educated
Hard-working
Resourceful
Natural selection...

Why innovation?

Yet Another Bubble?
No!

Why Not?
Innovation is not an industry
Innovation is a mentality
A mentality that needs nurturing
Innovation is the way to harvest the people resource

It’s Bubble-wrap

Diverse Economy
10-20 pillars instead of 2-4
Realistic?
CCP equals Iceland’s capelin fishing
Marel is bigger than ferro silicon
Össur is bigger than Icelandair
They were all typical start-ups

What is Innovation?
It’s not ideas
That’s invention

What is Innovation?
Innovation is execution
Turning ideas into value

“ Genius is 1% inspiration, 99% perspiration”

Put another way...
Innovation is a stroke of genius, then a lot of hard work
Not necessarily by the same people
You can be a part of innovation, without being an idea-person

The Innovation Pyramid
1000 people get an idea
100 companies are started
10 succeed
1 may become a superstar

100 x 4 = 1 x 400
100 x 4 becomes...
10 x 50 and maybe...
1 x 1000
Value is created on all levels

Healthy Economy

Steps towards: Innovation Culture Innovation Culture

Nurturing Innovation
Get out of the way
Encourage
Help a little

But first...
There are not a lot of start-ups around:

A Narrow Path...
...between success and bankruptcy

The Wrong Reasons
This path is probably very narrow now
In some cases for all the wrong reasons
Immediate action: Make sure we keep the best going!

Get out of the way
There is still some capital around
In ISK
What better use than fund companies that will make money in foreign currency?

Get out of the way
Reward investments in startups, e.g. with tax breaks on returns

Encourage Innovation
Innovation culture:
Social networking, studies, info exchange
Make innovators role models
Imprint that “Failure is also success”

Be a little helpful
Make sure that current funds continue
Frumtak, Rannís, development funds
Innovation on the curriculum
Tax incentives for knowledge driven industries?

Recap
Bubbles and Iceland
Long history
Three pillars of economy
Fragile

Recap
Bubbles and Iceland
Why Innovation?
Harvest the manpower
Diversify economy
Sustainable resource

Recap
Bubbles and Iceland
Why Innovation?
Innovation Culture
Immediate action
Get out of the way
Encourage innovation
Be a little helpful

Finally

Nyskopun.org
Wiki site (Icelandic)
Single purpose:
Help making Iceland the best possible environment for innovation

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Innovation Renaissance

by Hjalmar Gislason on Nov 15, 2008

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Innovation Renaissance — Presentation Transcript