Lack of Collaboration Infecting San Diego’s Innovation Economy

Published in San Diego Union-Tribune, August 10, 2015

You can store grain in it or you can store information in it. In one, you can get the grain out of the silo and bake bread with it. But in the other, information is trapped forever, slowly rotting from lack of oxygen — or so it seems. The information silo — also known as an insular management system incapable of reciprocal operation with other, related information systems — is alive and well and is infecting the innovation economy in San Diego.

Today is rant day. I am on a bender of late, wondering why we have such an uncollaborative technology ecosystem. There are approximately 35 distinct organizations tasked in varying degrees with trying to make things better. This number includes 17 not-for-profit technology incubators (each with an executive director), seven technology industry groups, and then there is everything from CONNECT to EDC to SANDAG to SDVG.

The most recent turf war involves UCSD and USC, arguing about which one owns the Alzheimer’s database. So, here’s a dumb question. Since it’s a database, what if you both shared it? I know each university wants to take credit and get more research dollars — power and prestige. But guys, I don’t really care who figures it out. All I care is that I can remember what I had for breakfast when I am 80.

I am not smart enough to tell you which organizations need to stay and which need to go — but I am dumb enough to know we probably have more than we need.

And the corollary to that is we do not use the money efficiently. The “usual suspects” get asked by every organization for support — and after a while, the suspects say enough is enough. In kindergarten, we are taught to play nice with all the members of the group. When did we unlearn this? In the future, I am personally going to see if I can assist with some silo-destruction, stay tuned.

Now a shout-out to the “I don’t look like Mark Zuckerberg” contingent of tech entrepreneurs. You do not need to drop out of college to start a company. The UC Berkeley Haas School of Business recently did a study and discovered the average founder (venture backed) is 38, with a master’s degree and 16 years of work experience. This is in stark contrast to the current paradigm promoted by Silicon Valley. It seems diversity (age, gender, experience) might be good for business.

Roy Bahat, who runs Bloomberg’s tech investment fund, says, “A small number of data points captivate our imagination — but the truth is — we might be wrong.” The current venture world relies heavily on referrals. You need to know someone who knows someone who can get you the investor meeting. That does not sound like the most efficient way to find the right customer. So Bahat and Bloomberg started a program called Future Founders. They studied lots of data, and what they found was a bit unsettling. Diversity matters. While only 12 percent of current founders are women, when they did their study, it turned out that 20 percent of potential founders were women.

Only 53 percent of founders have technology backgrounds, which is good news for those of us who can’t code. And as for Peter Thiel and the glorious college dropout diaspora, the number was “statistically negligible.”

Here is the kicker. If you worked at a venture-backed company, (whether you failed or succeeded) you were the most likely to start a company. If you were at General Motors for 30 years, not so likely.

Predicting whom to back is not so easy. Thomas Thurston, managing director at WR Hambrecht, says, “Everyone can put in whatever data they want.” (Thus, the risk of hammers looking for nails). And finally, from David Leonhardt, Upshot columnist for The New York Times, “Startup investing depends too much on timing, luck and human judgment. But a more diverse set of founders might be financed by doing more than waiting for a kid in a hoodie to show up at the door.”

If we could really know what an entrepreneur looks like — well, that’s the whole point — we can’t. But I think looking in all the wrong places might be a good start.

Neil Senturia, a serial entrepreneur who invests in early-stage technology companies, writes weekly about entrepreneurship in San Diego. Please email ideas to Neil at neil@blackbirdv.com

Rule No. 431: A future founder might be hiding in plain sight.

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