Tweaking Friedman

This article dittos the underlying premise behind one of Tom Friedman's recent provocative ideas about technology, entrpreneurship and innovation. A snip:

Government funds for the VC industry is simply unnecessary. At $30 billion per year, there is no lack of VC capital being deployed in America. The bottleneck in the VC-entrepreneurship equation isn't in the inputs of capital, it's in the outputs. The lack of exits and the dearth of the IPO market is what needs to be fixed to open the floodgates of innovation.

But then I thought - let's not go overboard with our criticism by taking Friedman literally. The guy's a huge fan of global entrepreneurship (I loved it when he referred to the worthy work of the global non-profit, Endeavor, as the "best anti-poverty program of all"). His heart and priorities are in the right place.

So before folks get up in arms about "bailing out VCs," let's take Friedman's comments figuratively. He's dead on when he points out that entrepreneurship is what is going to get us out of this mess. The government shouldn't focus on silly notions of VC subsidies that nobody wants. Instead, the policy agenda to foster entrepreneurship and the flow of capital to entrepreneurs is very clear.

The article goes on to talk about specific policy needs for America's tech based economy. I'd tweak Friedman a little differently by saying he's right on the underlying anti-poverty idea of entrepreneurship. But we need a stronger pro-entrepreneurship in general in America, not just one focused on tech companies. And the problem is about more than the current recession, we need more entrepreneurs for entirety of the forseeable future.

It'll take entrepreneurs to replace the factories lost to globalization, to find ways to reduce our carbon footprint within the coming regulatory framework, to make coal cleaner, to find new ways to use the next wave of the web, etc. Entrepreneurship is just a new app to be used to solve a particular problem. It should be part of our DNA in America.

VC Money Moves towards Green Tech Creating Opportunities for Environmentally Friend Tech

I’m in Texas this week for the annual National Business Incubator Association conference. The theme of the conference is Innovation for a Strong Economy and Healthy Planet. Several of the conference’s breakout sessions are devoted to green energy. These facts reiterate a point I heard an expert on VC financing make recently: the smart money among Venture Capitalists in Silicon Valley is headed towards Green Tech… and I don’t just mean green as in the color of money, I mean green in terms of the environment.

Of course it’s possible that there is as much irrational exuberance in this phenomenon as the IT market of the 90’s or the housing market of the 2000’s, but hey, we’ll let Ben Bernanke worry about that.

Bottom line: if you know of a company working in areas such as the environment, now’s the time for them to get funding.