Reboot (Take 1) was presented in “Reboot, Part 1: NE Wisconsin 3.0.” Today’s post takes a slightly different approach in explaining why I think a Reboot is needed.
Technology Is Relevant
As technology becomes more relevant to disruptive innovation, the national economy, and the global economy, NE Wisconsin becomes less relevant to disruptive innovation, the national economy, and the global economy. That trend is shown in the chart below.
Factors For Thriving Regional Disruptive Innovation
Nobody has yet figured out a repeatable formula for building a region with fast adoption of emerging technologies, a high level of disruptive innovation, and ongoing creation of new high-paying jobs. But some of the factors which appear to help a region’s disruptive innovation emerge and continue to grow in impact are:
- Tech industry clusters and ecosystems.
- Research universities and exemplary education systems.
- Risk-tolerant regional culture.
- Unique regional resources and competitive advantages.
- Strong network of highly successful entrepreneurs.
- Favorable government policies and regulations.
- High population density and many creatives.
- Diverse population, including motivated and educated 1st-gen American immigrants.
- Uniquely attractive weather, geography and terrain.
Disruptive Innovation Rating For NE Wisconsin
The above list of factors favorable for thriving tech entrepreneurism and disruptive innovation is not definitive or complete, but these are relevant and important issues. Therefore, it seems useful and instructive to look at NE Wisconsin and do an informal rating for the region on each factor.
- Tech industry clusters and ecosystems. NE Wisconsin does not have any tech industry clusters or significant ecosystems. Historically strong industries are paper and forest products, dairy, agriculture, and traditional heavy manufacturing. Technology in NE Wisconsin primarily means IT and MIS, rather than CS, coders, developers, founders and emerging technologies such as nanotech, photonics, microelectronics, robotics, 3D printing or wearable computing.
- Research universities and exemplary education systems. NE Wisconsin does not have any major tech research universities. The overall performance of the region’s education system is good, but there are few if any exemplary schools or school districts that attract families with high potential youth to relocate to their area because of educational opportunities. Nor do the school systems have extensive collaboration with the NE Wisconsin TIE community (Tech, Innovators, Entrepreneurs). Contrast that with Joseph Schumpeter’s education* and the opinion of GE’s CIO, Jim Fowler**.
- Risk-tolerant regional culture. NE Wisconsin has a risk-averse culture. Launching a startup here that does not give you an income equal to or greater than a good-paying “normal” job or having to shut down your startup means you failed, rather than meaning you may have learned how to do better on the next startup. Most potential investors for startups in the region want a guaranteed return that is higher than investing in the stock market or other traditional investment options. They are not interested in investing in startups if only two or three out of ten will be successful. And they’re highly unlikely to invest in pre-seed stage startups as part of a serious effort to improve the entrepreneurial culture of the region or to kickstart entrepreneurial swarming.
- Unique regional resources and competitive advantages. NE Wisconsin has only two truly unique regional resources which are known nationally and globally — the Green Bay Packers and the Experimental Aircraft Association. Neither of these are a compelling source of regional disruptive innovation or tech entrepreneurism, although they do present intriguing opportunities that I’ll discuss in a future post.
- Strong network of highly successful tech entrepreneurs. NE Wisconsin does not have a strong network of highly successful tech entrepreneurs (as far as I know) who are actively working to expand the tech entrepreneur community and improve the region’s culture. I’m not even aware of very many highly successful tech entrepreneurs in NE Wisconsin. It’s possible such a network exists, and my lack of knowledge about it is due to me not being a highly successful tech entrepreneur and not being seen as useful to the people in that network. And there may be many highly successful tech entrepreneurs in the region, but they just prefer to stay under the radar. Brad Feld of Foundry Group views a strong network of entrepreneurs who lead programs to be the key to building a highly entrepreneurial region.
- Favorable government policies and regulations. Wisconsin and NE Wisconsin government policies and regulations are generally not strongly supportive of disruptive innovation and tech entrepreneurship.
- High population density, many creatives. NE Wisconsin does not have a high population density, even in its larger cities. The region is not an immigration destination for creatives and does not have a widely connected community of creatives or wide-based regional support for creatives.
- Diverse population. NE Wisconsin’s population is not highly diverse. And the population of the region’s TIE community is even less diverse, being mostly white and male.
- Uniquely attractive weather, geography and terrain. NE Wisconsin does not have any uniquely attractive weather, geography or terrain. It gets very cold in the winter, but there is not enough snow to build a strong snowsports industry. The region does not have mountains or ocean beaches, and it doesn’t have any other spectacular geography that might draw entrepreneurs, creatives or other potential disruptive innovators.
If you add up all of NE Wisconsin’s factors favorable for disruptive innovation, you won’t get a large number. We don’t have critical mass and aren’t at a tipping point for a significant increase in disruptive innovation. That doesn’t mean we can’t have disruptive innovation–it just means we have to approach the topic differently than other regions.
* “…[Schumpeter’s mother] wanted an even larger stage for her talents and her son’s…she arranged for the new family to move to Vienna…a far cry from Graz, or even Triesch. In Vienna she entered [Schumpeter] in a renowned preparatory school…The Theresianum was one of the best and most demanding schools of its kind…His family had leased an entire floor of one of the luxurious apartments situated near the famous Ringstrasse…Schumpeter’s daily walks took him past places steeped in history, and where history was still being made…He did this from the ages of ten to twenty-three…The Theresianum required far more rigorous work than most high schools do today…As at high schools everywhere, then and now, many students tried to idle their way through, doing as little work as possible. But Schumpeter–playful and outgoing as he was–had the true intellectual’s curiosity about the world…For a diligent student like Schumpeter, an education at the Theresianum followed by a degree at the University of Vienna conferred priceless intellectual assets…Both the Theresianum and the University of Vienna emphasized what today would be called “networking.”…In the early stages of his career, Schumpeter was to discover that he too needed noble patronage…”
** “…Kids are the ultimate beta testers…There is a lot of talk about the lack of STEM education in America, and we absolutely have to make a formal, concerted effort to get more hard science into our classrooms. But we also shouldn’t overlook the many things outside the classroom that might kick off an active, lifelong interest in technology…that engage young people with technology in ways that draw on their natural independence and creativity…”
Realistic Expectations For Next 20 Years
With the programs and activities currently in place and likely to develop in NE Wisconsin, realistic expectations for technology, disruptive innovation, and entrepreneurism in this region over the next 20 years are:
- Technology, innovation and entrepreneurism will continue to improve in NE Wisconsin, but at a slower pace than on the West Coast, the East Coast, and in many other regions not on either coast. Examples of non-coast regions where innovation is improving faster than NE Wisconsin are Madison, Milwaukee, Chicago, Minneapolis, Austin, Kansas City, Chattanooga, Ann Arbor, Champaign, Fort Collins, and Provo.
- Very few scalable tech startups will launch in this region and very few successful ones will stay in NE Wisconsin as they grow.
- Minimal and non-coordinated support for technology, disruptive innovation and tech entrepreneurism will be provided by NE Wisconsin corporations, influential individuals, investors, regional governments, or state government.
- There will be minimal NE Wisconsin participation or notable achievements in emerging technologies. There will be few NE Wisconsin ventures leveraging emerging technologies for competitive advantage.
- There will be minimal disruptive innovations developed in NE Wisconsin. Few NE Wisconsin companies will effectively leverage disruptive innovations for competitive advantage.
- The NE Wisconsin TIE community will continue to not be widely and deeply connected, resulting in infrequent opportunities for like-minded people to interact, discuss, collaborate, or cofound startups. The lack of wide and deep connections also results in much less disruptive innovation and hinders the entrepreneurial swarming necessary for creative destruction.
- Most people, especially young people, who passionately want to participate in disruptive innovation will move from NE Wisconsin to another region more supportive of disruptive innovation.
Bottom Line ⇒ NE Wisconsin gradually improves but continues to fall behind other regions.
These expectations might seem overly harsh. Most people in NE Wisconsin do not care about disruptive innovation. Nearly all people in the region who do care about innovation will disagree with this post and point to what they see as examples of improvement and disruptive innovation. Or they will say that this region doesn’t need disruptive innovation to have the best possible regional economy, one that is sustainable and resilient and leads to a bright future for our children and for their children. I respectfully disagree and say significant changes are needed to achieve the regional economy and brighter future we want.
The Next Step for Reboot is to connect people interested in disruptive innovation and a thriving, resilient, sustainable regional economy and have the conversations needed to develop a plan for change.
If you know of examples of disruptive innovation in NE Wisconsin, please send information and links to Bob Waldron at bwaldron (at) gmail [dott] com.
If you are interested in discussing and working on disruptive innovation, contact me.
If you know of NE Wisconsin people potentially interested discussing and working on disruptive innovation, please connect them with me, or send me info about them.