Obama Gets Serious About Innovation With Cleveland Entrepreneurs

By Carol Tice

President Barack Obama has been out meeting with entrepreneurs before, but usually just a few at a time, as he did last summer in Seattle. But in mid-February, Obama had his first major small-business confab with more than 100 Cleveland-area business leaders. The event -- a followup to the State of the Union Address dubbed the Winning the Future Forum -- also featured a half-dozen cabinet members and other top-level administration advisors. One star-quality guest was AOL co-founder Steve Case, who is chairing the president's new initiative, Startup Partnership America.

I had a chance to speak with several attendees about the event, who described it as a great opportunity to reach top-level administration officials and tell them about entrepreneurs' real-life issues. Sure, it was also partly a media opportunity for Obama to get out the message that he cares about small business...but there was real substance to the meetup as well.

After Obama gave an opening speech, the forum divided into small breakouts on topics including entrepreneurial endeavor, youth engagement, export, workforce development, access to capital, and clean energy. While the entrepreneurs had to pick a breakout and stick to it, Obama was free to roam through the various sessions, reports John Dearborn, CEO of JumpStart, a Cleveland nonprofit that assists small business owners.

It was definitely not an audience made up entirely of friendly Democratic business owners, either. Some participants expressed serious disatisfaction with the way Obama has treated entrepreneurs so far.

In the breakout sessions, administration officials took notes on what entrepreneurs said they'd most like to see the White House do to assist them. For instance, new patent-reform legislation, Patent Reform Act S23, was a major concern expressed by Cleveland Medical Devices CEO Robert Schmidt.

"People don't understand how onerous it is," he told me. "It will price independent inventors out of the market. The price to protect an invention will be $250,000-$500,000."

Schmidt would also like to see more research and development funding from the Small Business Innovation Research (SBIR) program and other federal R&D efforts go to small companies instead of large corporations. He says that though 38 percent of engineers and scientists work in small businesses, less than 5 percent of federal research money goes to smaller enterprises.

"The people who produce the most wealth and create jobs, we underfund by an order of magnitude," he says. "Then we're surprised when we don't have jobs."

Getting the government-contracting system to run better was an issue raised by several participants. Synergy Marketing Strategy and Research CEO Rachel Talton asked for reform in the process of obtaining federal contracts, to make it easier for small businesses to apply. Others asked that the government pay its contracts faster, as its slow payments can cause cash-flow problems for small business owners.

Possibly the best news out of the conference is that it wasn't just a venting session. Participants report they are expecting to hear back from administration brass on their ideas. Talton's company plans to help the White House with research, and she says officials were huddling with her immediately after the forum concluded.

JumpStart's Dearborn took notes for the administration in one of the breakouts, and says he was asked to hand them in immediately. He high-tailed it back to his office and typed up his notes, sending them off to the White House at 10 pm. We'll see what comes out of this interesting exchange between Cleveland's small-business community and Obama's team in the coming months.


What do you think the government should do to help small business owners? Leave a comment and let us know.

Obama photo via Flickr user aflcio

How to Spot a $100 Million Idea

By Carol Tice

Every entrepreneur would like to discover the next big idea. New, great businesses are launched every day. But how do you know when you've hit on a winning idea?

In his recently released book How They Did It: Billion Dollar Insights from the Heart of America, serial entrepreneur Robert Jordan interviews the founders of 45 top companies that created $41 billion in value.

What do their successes have in common? Jordon identified these key traits:

Identify a big problem. Great products often solve a very real problem for customers. Think of the celphone. Businesspeople struggled to stay in touch with their customers when they were out of the office. Solving that one revolutionized the telecommunications industry and made innovators mega-billions.

Think needs, not passions. Many entrepreneurs try to turn their personal passion into a business and fail. But when you focus on meeting other people's needs, you can really see your business take off. For instance, Feedburner founder Dick Costolo realized people were creating blog content but had no easy way to distribute it to interested readers. The result: Google bought Feedburner for $100 million.

Be hands-on. Jordan found successful big-company founders were tinkerers and doers. The entrepreneurs were out experiencing and trying things, not sitting at a desk thinking.

Collaborate. Two or three heads really are better than one. Many companies gelled after several founders put together their strengths and ideas. Think Microsoft's Gates and Allen, or Steve Jobs and design genius Tim Cook. Apple would be nothing without their combined effort. He warns not to be self-involved or a loner -- get others onto your team.

Sell your idea. Every founder Jordan spoke with had gotten out on the front lines and tried to sell their product or service. That up-close contact with customers often inspired innovations that changed the offering and made it a big success.

To these strategies for finding the $100 million idea, I'd add -- look for the gap in the market.

So often, great companies are started by entrepreneurs because they tried to find something they needed in their own life -- but couldn't. Then they researched and found what they needed didn't exist anywhere. So they created it.

I recently got to talk with the actress Tiffani Thiessen, who created a new line of baby-room furniture and bedding after being unable to find anything she liked in the usual sea of baby-blue and pink. She collaborated with HGTV designer Lonni Paul to create her line, PetitNest, which was the hit of the Las Vegas Market furniture show last year.

What's your $100 million idea? Leave a comment and tell us about it.

Illustration via stock.xchng user raja4u

Insights on Innovation

The world is changing very fast. Big will not beat small anymore. It will be the fast beating the slow.
Rupert Murdoch

When you innovate, you've got to be prepared for everyone telling you you're nuts.
Larry Ellison

Innovation distinguishes between a leader and a follower.
Steve Jobs

How does your company do innovation? Is risk-taking tolerated at your company? What BIG ideas are you encouraging? Is innovation coming out of marketing, operations, finance, IT?

In This Economy, It's Innovate...Or Else

by Carol Tice

It's fitting that I'm sitting down to write about innovation now, as August is National Inventors Month. It's a great time to be thinking innovation for other reasons, too.

Last fall, the president announced a major initiative to try to rocket the U.S. back to prominence in innovation. His Strategy for American Innovation initiative raised federal funds for research and development to a historic high, $18.3 billion.

The president also continues to work to make the Research and Experimentation Credit permanent. Lots of small businesses don't even know about this great tax-credit program, which has been limping along on annual renewals year to year since 1981. The credit basically rewards companies that grow their research budgets. From an established base level of innovation spending, this tax break allows you to claim 20 percent of qualified additional expenses for research.

It's a complicated credit, but worth it -- it refunded $5.6 billion to businesses last year.

Whether you do big research or not, innovation should be part of your company's culture, says Alexander Hiam, author of Business Innovation for Dummies.

"You need to innovate to succeed in your working life," he says. "The creative, forward-thinking people are the ones who make their mark and get ahead. It's often risky to try new things or propose new approaches, but it's even more risky to play it safe and close your mind to creative change."

With all the changes our economy has wrought in our culture the past couple of years, standing still is definitely not an option. Innovation is what's for dinner now.

What are you doing at your company that's innovative? Leave a comment and let BVR Times readers know about it.

Photo via Flickr user hughelectronic