innovation renaissance

hjalli@datamarket.net

Innovation Renaissance

Hjalmar GislasonCEO, DataMarket

hjalli@datamarket.net

About Hjalmar

•Started 4 companies in 11 years

•Some have succeeded, others not

•Currently: DataMarket (datamarket.net)

•Never bankrupt, a few happy investors

•Almost 100 man-years

•A few million dollars in foreign currency

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Agenda

•Bubbles and Iceland

•Why innovation?

•Innovation Culture

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1100 years of bubbles

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Arctic trade bubble

•First 300 years - incredible wealth

•Sagas, ships, trade and treasures

•Where did the money come from?

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Arctic trade bubble

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Arctic trade bubble

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Arctic trade bubble

•Debt of Venice to the Pope paid with unicorn horn!

•Burst in the 1200s

•Result: 700 years of misery

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Herring bubble

•1967-1969 herring disappears

•Result: A few years of recession

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Fur and fish farming bubble

•In the 1980s

•Result: Over investment in many rural areas

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Dotcom bubble

•You know this one (actually financial)

•Result: 3-4 years downturn

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Banking bubble

•October 2008

•Result: ???

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Non-bubbles

•1965

•Exports: Fish

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Non-bubbles

•1980

•Currency from: Fish, Aluminum

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Non-bubbles

•2000

•Currency from: Fish, aluminum, tourism

not “export”

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Non-bubbles

•2007

•Currency from: Fish, aluminum, tourism, banking

not “export”

Banking

?

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Non-bubbles

•September 2008

•Currency from: Fish, aluminum, tourism, banking

not “export”

Banking

?

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Non-bubbles

•November 2008:

•Currency from: Fish, aluminum, tourism

not “export”

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Import-Export in short

•Export: Fish, aluminum and happy tourists

•Import: Everything else!

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Iceland’s risk•When one pillar of the economy is hurt,

our standard of living hurts equally

•What if:

•Fishing stocks dwindle?

•Aluminum prices collapse?

•Travel becomes too expensive?

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No more bubbles!

•We cannot afford another crash

•(we don’t even know yet if we can afford this one)

•Icelandic economy must diversify

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Analysis

•Resources

•Fish

•Energy

•Land

•Nature

•Oil?

•What else?

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People

•A major resource:

•Educated

•Hard-working

•Resourceful

•Natural selection...

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Why innovation?

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Yet Another Bubble?

No!

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Why Not?

•Innovation is not an industry

•Innovation is a mentality

•A mentality that needs nurturing

•Innovation is the way to harvest the people resource

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It’s Bubble-wrap

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Diverse Economy•10-20 pillars instead of 2-4

•Realistic?

•CCP equals Iceland’s capelin fishing

•Marel is bigger than ferro silicon

•Össur is bigger than Icelandair

•They were all typical start-ups

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What is Innovation?

•It’s not ideas

•That’s invention

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What is Innovation?

•Innovation is execution

•Turning ideas into value

hjalli@datamarket.net“Genius is 1% inspiration, 99% perspiration”“Genius is 1% inspiration, 99% perspiration”

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Put another way...

•Innovation is a stroke of genius, then a lot of hard work

•Not necessarily by the same people

•You can be a part of innovation, without being an idea-person

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The Innovation Pyramid

•1000 people get an idea

•100 companies are started

•10 succeed

•1 may become a superstar

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100 x 4 = 1 x 400

•100 x 4 becomes...

•10 x 50 and maybe...

•1 x 1000

•Value is created on all levels

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Healthy Economy

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Steps towards:

Innovation Culture

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Nurturing Innovation

•Get out of the way

•Encourage

•Help a little

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But first...

•There are not a lot of start-ups around:

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A Narrow Path...

•...between success and bankruptcy

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The Wrong Reasons

•This path is probably very narrow now

•In some cases for all the wrong reasons

•Immediate action: Make sure we keep the best going!

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Get out of the way

•There is still some capital around

•In ISK

•What better use than fund companies that will make money in foreign currency?

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Get out of the way

•Reward investments in startups, e.g. with tax breaks on returns

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Encourage Innovation

•Innovation culture:

•Social networking, studies, info exchange

•Make innovators role models

•Imprint that “Failure is also success”

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Be a little helpful

•Make sure that current funds continue

•Frumtak, Rannís, development funds

•Innovation on the curriculum

•Tax incentives for knowledge driven industries?

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Recap

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Recap

•Bubbles and Iceland

•Long history

•Three pillars of economy

•Fragile

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Recap

•Bubbles and Iceland

•Why Innovation?

•Harvest the manpower

•Diversify economy

•Sustainable resource

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Recap

•Bubbles and Iceland

•Why Innovation?

•Innovation Culture

•Immediate action

•Get out of the way

•Encourage innovation

•Be a little helpful

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Finally

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Nyskopun.org

•Wiki site (Icelandic)

•Single purpose:

•Help making Iceland the best possible environment for innovation

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BETA