Today is a dynamism day here at KP, whether it’s marketing or technology or business models. Business Week has an interview with Frank Moss, the new head of MIT’s MediaLab. He points out the importance of several things that I think are crucial for dynamic innovation: entrepreneurship, new models of collaboration and invention, and focusing on disruptive change instead of incremental tweaks:
How do you view the nexus between technology and entrepreneurialism?
It is hugely important. In fact, entrepreneurs are really the primary vehicle for innovation in our society. They’ve played an incredible role. Thirty years ago, the primary source for innovation was large corporate labs. That is where all of the money went. Then, 20 to 25 years ago, the source of ideas and creativity shifted to venture funds and startups.
Over the past 20 years, we’ve seen the economy and society change due to innovation from small independent efforts outside of corporate labs. Technology has enabled startups to have a big influence, and consequently they have had a tremendous effect in the technology scene today.
What role will startups play in the future?
I see tremendous economic growth from startups from 10 years ago. Entrepreneurs will go from the 1,000 startup ventures funded in the last 10 to 20 years to ideas coming from people working together in network-based environments, using computers to dream up innovations in a way they never did before. It could be people in developing countries with low-cost computers.
The Media Lab has given a start to many entrepreneurs. What would be your advice to would-be entrepreneurs in today’s environment?
Resist the current temptation to make incremental changes to attract funding. It might get you off the ground, but I don’t think it will get you very far. Today, the funding climate has changed. The successful (entrepreneurs) will look for fundamental disruptive change. I encourage them to take risks, rather than just polish the faucets. There will always be an appetite for game-changing technology.
Note in particular his focus on distributed, decentralized, networked innovation. This way of thinking about innovation taps in to the idea that creativity resides in many distributed individuals, and that a distributed network may do a better job of generating beneficial disruptive change than a centralized, coordinated, top-down lab approach.
I think it makes for an interesting challenge for an organization like MediaLab; at some level, it will be harder to direct and target resources on projects that are likely to be transformational, because so much more innovation will be distributed and not concentrated in big labs. At another level, though, MediaLab can seed particular projects or individuals who are working in a distributed network, and that bottom-up approach might be more likely to lead to successful disruptive technologies than the coordinated large-lab approach.
Thanks to Glenn Reynolds for the link.
UPDATE: Paul at Truck and Barter has a link-filled post on the same question, inspired by an article in the Economist on a recent AEA session on entrepreneurship. Note his link to Chris Coyne’s post at Austrian Economists, where he laments the absence of attention to Kirzner in the Economist article, a lament that I second.