Runway Incubator | The Innovation Blog

The Role of Government in Supporting Innovation

Posted by Runway on Nov 24, 2015 10:56:57 AM

  145921We had a group come in from Sweden  on Friday, and some of the folks were interested in talking about the role of government in supporting innovation. I’ve gotten this question a few times from government officials over the years. At the crux of every inquiry is the question of how silicon valley became “silicon valley”, the land of dreams, unicorns and awesome satirical TV shows. Believe it or not, there are a ton of people around the world thinking about this question. It affects things like jobs, policy, budgets, etc. I’ve spent a while thinking about this and keep coming back to the same conclusion. What you need is a group of smart, creative, ambitious people who have the headspace to build innovative products and services.

 

I know there are a lot of buzzwords in there so I should unpack that. I think that there’s something special that happens when you get a group of smart people together who want to build something, and you just leave them alone for a while. It seems like there is a direct correlation between high caliber educational institutions and innovation. But I don’t think the educational institutions themselves are providing the framework for building products and companies. I think it’s the loose working day (let’s face it, you’re in class for about 12 hours a week) and the fact that everyone is living and working together that gives rise to creation. And I don’t even think that what’s created needs to be commercially viable. Most great movements are started by small groups of people who are creating cool things for each other and don’t care about making money. Bitcoin, personal computing, etc.

 

So what can governments do to help? Well, I think anything that aids the above would be a step in the right direction. Which means, putting smart and ambitious people who are interested in building something together for a while and leaving them alone. And then not being overly concerned about what they’re creating. This could mean providing something similar to a Fulbright Scholarship to promising young people who could receive a minimal stipend while they work on their ideas. It could mean creating government sponsored academies that don’t have traditional curriculum and are more about working together on cool stuff. And any “classes” should be led by current or former entrepreneurs or inventors, not academics. Most important, whatever they do, they shouldn’t burden the founders with going into debt, or insist on owning IP or taking equity positions in the companies they support. The financial return any government should come in the form of increasing GDP, jobs etc. as an eventuality of success. Notice I haven’t mentioned anything about VCs investing into the ecosystem, and that’s because I think venture capital will always flow to innovation centers over time.

 

Will these ideas work? Is this enough? Is there actually anything a government can do to help promote a startup ecosystem? I don’t really know. But I like the idea of governments supporting things like what we’re doing here at Runway. And I like the fact they’re taking the time to stop by and ask.

 

Matt Walters
Runway

Written by Runway

Topics: Business