TSMC Conference 2009

COLLABORAZIONE, INNOVAZIONE, RICERCA E
IMPRENDITORIALITA'
Alberto Sangiovanni-Vincentelli
The Edgar L. and Harold H. Buttner Chair of EECS
University of California at Berkeley
Co-Founder, CTA and Member of the Board
Cadence Design Systems
Comitato Esecutivo, Istituto Italiano di Tecnologia
Comitato Scientifico, CNR
Advisory Board (Walden International, Sofinnova, Innogest,
Xseed (MDV))
Investment Committee (Fondo Atlante, Fondo Next)
Copyright: Alberto Sangiovanni Vincentelli 2011
OUTLINE
• Collaboration, Research, Innovation and Venture Capital
• Technological Opportunities driven by Collaboration and Research:
The New Innovator!
Copyright: Alberto Sangiovanni Vincentelli 2011
Collaborate to Innovate:
the Quest for the Virtual Corporation Manager
• Firms will focus more sharply on what they do best, and they will enlist a
growing diversity of suppliers for the rest. Organizations will increasingly
look outside their walls not just to reduce costs but for innovation – in
processes, product and service differentiation – to free up resources,
transform their businesses, and facilitate sustainable competitive
advantage. As supply networks become more global and complex,
winning will depend on transparency, trustworthiness, and reciprocity. In
a word: collaboration. (Alan McCormack et al. (HBS))
• The ideal collaboration model is the Virtual Corporation where the
different firms involved in collaboration act as if they were division of the
same corporation (or even better!!).
Copyright: Alberto Sangiovanni Vincentelli 2011
Silicon Valley: The Land of Innovation
Copyright: Alberto Sangiovanni Vincentelli 2011
Silicon Valley: Role of Universities
Copyright: Alberto Sangiovanni Vincentelli 2011
Factors in Success
Infrastructure
– Legal and financial services
– Excellent Universities
– The simultaneous presence of large, medium and small companies
– The “network”: both inside and outside company boundaries
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Copyright: Alberto Sangiovanni Vincentelli 2011
The role of VCs in the Industrial Innovation Landscape
• As a complementary lens on technological and market change
– VCs see the world differently
• As a window on global technology development
– Technology is global and driven by local/regional needs
• As a supplement to or portfolio hedge against internal R&D programs
– Not even the best and biggest corporate R&D can cover all possibilities
• To drive new/expanded market development or other strategic (non-R&D)
objectives (Intel; Microsoft)
• Explicitly to develop risky new ideas that will initially flourish better outside the
corporation (Cisco)
– A form of outsourcing of innovation
• The best VCs adhere to "simple" fundamentals:
– world-class leadership and team;
– large, growing market;
– defensible big idea;
– rigorous application of best innovation practices
Copyright: Alberto Sangiovanni Vincentelli 2011
Risk Factors in Evaluating Startup Opportunities
•
•
•
•
Execution Risk
Market Risk
Technology Risk
Variable Factors (dependent on sector or specific opportunity):
– Future Financing Risk
– Regulatory Risk
Copyright: Alberto Sangiovanni Vincentelli 2011
Liquidity and Returns
• Exit options
– IPO vs. M&A (see chart, next slide)
– Bankruptcy vs Shut-down
• Typical venture portfolio performance:
– Historical data:
– Out of every 10 investments
• Half do not return capital
• 1 returns >10X
• Rest return 1-10X
Source: M. Borrus, Xseed
Copyright: Alberto Sangiovanni Vincentelli 2011
U.S. Venture Capital Investment
1995–2008
$120,000
105,140
$ Million Invested
$100,000
$80,000
54,102
$60,000
40,609
$40,000
14,894
$20,000
8,031
21,100
21,941 19,730
22,422 22,968
26,449
29,406 28,298
11,271
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
$0
Source: PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report; Data: Thomson
Financial
Copyright: Alberto Sangiovanni Vincentelli 2011
Venture Exits—IPOs and M&A
by Year, 1991–2008
600
M&A
Number of Issues
500
IPO
400
300
200
100
0
M&A
IPO
91
17
156
92
76
181
93
74
220
94
100
166
95
97
202
96
116
270
97
164
136
98
209
77
99
240
260
'00
317
264
'01
353
41
'02
318
22
'03
290
29
'04
339
93
'05
350
57
'06
368
57
'07
355
86
'08
260
6
Year
Source: NVCA, Thomson Reuters
Copyright: Alberto Sangiovanni Vincentelli 2011
2008-2010 Exits: Heating up Again (LinkedIn Story)
Copyright: Alberto Sangiovanni Vincentelli 2011
Portfolio Progress
8 companies
past seed stage
1,700+ ideas/
researchers
canvassed
~950 resulting start-up
ideas analyzed in detail
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Companies funded
16
Live
2
Shut Down
DigitAB
StemCor
[ 13 ]
What Drives Venture Returns?
• Market growth not absolute size
• Efficiency of capital deployment
• Irrational exuberance in exit markets
• A handful of big winners
And most of all
• Fundamental Innovation—The (Tech) world isn’t “flat” (next
slide). Great Universities play a role!!!
Source: M. Borrus, Xseed
Copyright: Alberto Sangiovanni Vincentelli 2011
The (Tech) World Isn’t Flat:
Boston
(Medical, HiTech
Harvard, MIT)
Distribution of most referenced patents
Oregon, Washington
(Microsoft, Intel
U. Wash, Toronto)
Illinois
Michigan
(GM, Ford, Chrysler, (Motorola,
U. Illinois)
U. Michigan)
Silicon Valley
Source: ATP and George Mason University
LA, S. Diego
(Qualcomm, Defense
UCLA, UCSD)
Texas
(Houston, TI, Freescale
U. Texas)
Copyright: Alberto Sangiovanni Vincentelli 2011
Consequence: VC Investment by US Region (2008 vs. 2007)
California (Especially Silicon Valley) Rules!
$ in Millions—All Results Rounded
# of
Deeds
0
California
3,000
New York
295
199
Texas
146
172
Washington
164
175
Colorado
100
97
$1,203
$1,130
$1,299
$1,469
$955
$1,382
$813
$610
90
92
$708
$632
171
159
$603
$819
47
57
$491
$489
Virginia
81
94
$499
$557
0
2,091
3,110
15,000
$2,974
$3,714
Minnesota
Top 10 Total
12,000
1,552
1,624
405
Pennsylvania
9,000
$14,264
$14,735
Massachusetts 446
New Jersey
6,000
2008
2007
5,000
10,000
15,000
20,000
30,000
$23,069
$25,595
Copyright:
Alberto
Sangiovanni Vincentelli 2011
Source: PricewaterhouseCoopers/National Venture Capital Association MoneyTree™
Report;
2008
Human Resources in Highly Innovative Ecosystems:
Meritocracy to the Hilt!
• Biggest challenge is to acquire and retain highly-skilled workforce
• Play on compensation based on bonuses, restricted stock and options as
well as special claused for acquired talent via acquisitions such as
earnouts and no compete agreements
• Hiring and compensation is mostly decided by technical leaders and
agreed upon by HR, HR guidelines may be violated if a good case is
mounted
• HR mostly focussed on internal issues: administration of the process, say
on exec compensation, participate on the compensation plan set up at
the Board level
Copyright: Alberto Sangiovanni Vincentelli 2011
Factors in Success 1
People and Technology:
• Scientific and Technology education
• Centers of excellence in research
• Talent pools (people form Universities and companies interested in highrisk high-reward activities)
• Ability to attract the “best” to the region (infrastructure for families and
continuous learning) but attention to moving social and financial costs
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Copyright: Alberto Sangiovanni Vincentelli 2011
Pasteur’s Quadrant
Considerations of Use?
NO
YES
Pure Basic
Research
(Bohr)
YES
Use-Inspired
Basic Research
(Pasteur)
Quest for
Fundamental
Understanding?
NO
D. Stokes
Pure Applied
Research
(Edison)
Copyright: Alberto Sangiovanni Vincentelli 2011
University-Industry Relationships
• Professors are promoted on the basis of their contributions in all areas,
including professional activities
• Reciprocal respect and attention to respective roles
• Unrestricted grants: “speed not patents”
• Transfer of technology through visiting professionals and summer
students
• Formation of new companies favored
• Companies compete fiercely on talents out of University
• Educational agenda left in the hands of University
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Copyright: Alberto Sangiovanni Vincentelli 2011
Factors in Success 3:
The Valley “Culture”
•
•
•
•
•
•
•
Move fast
Leverage all you can
Do not be afraid of making mistakes
Learn from your errors
If you fail, try again
Re-invent yourself and your company constantly
Grow grow grow ……
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Copyright: Alberto Sangiovanni Vincentelli 2011
Israele
Sistema
scolastico e
universitario di
eccellenza
• Più start-ups dopo USA (più
seed investments di USA in
valore assoluto)
• Quasi 100 VC, ~10 miliardi di
dollari under management
• Governo imprenditore (Yozma,
incubatori, Life Science VC)
Imprenditorialità
• Più alto numero di Nobel pro capite (più
che tutta l’area euro)
• 4 università nelle top 100 in scienze
- N° 3 in pubblicazioni scientifiche pro
capite
- N° 1 in laureati pro capite
• Più di 1.700 laureati all’anno in Life
Sciences
Cultura
orientata
all’innovazione
e alla crescita
globale
• Più alto numero di aziende
quotate al Nasdaq dopo
USA
• Più alta spesa di R&D sul
PIL
• PIL 1948-2008: x50 (come
Cina, >Giappone, Corea)
• Global view
Copyright: Alberto Sangiovanni Vincentelli 2011
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Haifa
Herzliyya
Tel Aviv
Gerusalemme
90 KM:
Stesso
Range as in
Silicon
Valley
Copyright: Alberto Sangiovanni Vincentelli 2011
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Italy Innovation 40-60% below comparable nations
EU 27 “European Innovation Scoreboard”
0,50
0,55
0,35
Source: European Community:“European Innovation Scoreboard 2008”
Copyright: Alberto Sangiovanni Vincentelli 2011
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R&D Gap is in the Private Sector
R&D as% of GNL
State and P.A.
Private Companies
Svezia
Giappone
Stati Uniti
)
Germania
Francia
Canada
UK
Italia
0
1
2
3
4
Fonte: Intesa Sanpaolo, Servizio Innovazione della Divisione Corporate su dati OECD 2005 - The Economist - August 2007
Copyright: Alberto Sangiovanni Vincentelli 2011
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Why should we worry about High Tech?
SUNRISE INDUSTRIES?
SUNSET INDUSTRIES?
Innovation and high tech can be as high in
New economy as in old economy!
Process vs Produc!
Copyright: Alberto Sangiovanni Vincentelli 2011
OUTLINE
• Research, Innovation and Venture Capital
• Technological Opportunities driven by Collaboration and Research:
The New Innovator!
Copyright: Alberto Sangiovanni Vincentelli 2011
The Enabling Technology: The Emerging IT Scene
Infrastructural
core
Sensory
swarm
Mobile
access
Copyright: Alberto Sangiovanni Vincentelli 2011
Predictions
EE Times,
January 07, 2008
• 5 Billion people to be connected by 2015 (Source: NSN)
• Web2.0
– The “always connected” community network
• 7 trillion wireless devices serving 7 billion people in 2017
(Source: WirelessWorldResearchForum (WWRF)
– 1000 wireless devices per person?
[Courtesy: Niko Kiukkonen, Nokia]
Copyright: Alberto Sangiovanni Vincentelli 2011
The Birth of Societal IT Systems:
Complex collections of sensors,
controllers, compute and storage
nodes, and actuators that work
together to improve our daily lives
Copyright: Alberto Sangiovanni Vincentelli 2011
The Cloud
• A multi-year tectonic and disruptive shift
• Proprietary Bottoms up analysis leads to $100bn opportunity
• Themes driving the shift:
1.
2.
3.
4.
5.
6.
7.
Cloud and Mobile…made for each other
Cloud interoperability
Security as a Service
Mega-bandwidth and Intelligent Networks
Collaboration & Social Networking
Platform as a Service
Private Clouds: Old wine in new bottle
Copyright: Alberto Sangiovanni Vincentelli 2011
The Cloud!
• Going back to centralized computing from distributed computing…like utilities
• Delivering personal (e.g., email, word processing, presentations) and business apps
(e.g., sales force automation, customer service, accounting) over the internet via a
subscription model.
• Cloud computing has been made possible by the shift to Internet built on Web-based
standards and improvements in hard drives, processors, and Internet speed
• Transfer of capital, implementation and maintenance risk
Copyright: Alberto Sangiovanni Vincentelli 2011
Massive Resources are Virtualized
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Copyright: Alberto Sangiovanni Vincentelli 2011
Challenge of Integrating Intermittent Sources
T. Boone Pickens Wind Farm
Sun and wind
aren’t where
the people –
and the
current grid –
are located!
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Copyright: Alberto Sangiovanni Vincentelli 2011
www.technologyreview.com
The Big Switch:
Clouds + Smart Grids
Computing as a Utility
Energy
Efficient
Computing
Embedded
Intelligence in
Civilian
Infrastructures
Large-scale industrialization
of computing
Computing in the Utility
Copyright: Alberto Sangiovanni Vincentelli 2011
Energy + Information =
Third Industrial Revolution
Jeremy Rifkin
“The coming together of distributed
communication technologies and
distributed renewable energies via an
open access, intelligent power grid,
represents “power to the people”. For a
younger generation that’s growing up in a less
hierarchical and more networked world, the
ability to produce and share their own energy,
like they produce and share their own
information, in an open access intergrid, will
seem both natural and commonplace.”
Copyright: Alberto Sangiovanni Vincentelli 2011
Towards Integrated Wireless Implanted Interfaces
Moving the state-of-the-art
in wireless sensing
clock
regulator
Tx
LNA
memory
DSP
ADC
electrodes
[Illustration art: Subbu Venkatraman]
Power budget: mWs
to 1 mW
Copyright: Alberto Sangiovanni Vincentelli 2011
Engineering Tomorrow’s Designs
Synthetic Biology
The creation of novel biological functions and tools by modifying
or integrating well-characterized biological components into
higher-order systems using mathematical modeling to direct
the construction towards the desired end product.
“Building life from the ground up” (Jay Keasling, UCB)
Keynote presentation, World Congress on Industrial Biotechnology and Bioprocessing,
March 2007.
Development of foundational technologies:
Tools for hiding information and managing complexity
Core components that can be used in combination reliably
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Copyright: Alberto Sangiovanni Vincentelli 2011
Microbial Synthesis of Artemisinin
Off-the-shelf parts?
HMGS
tHMGR
atoB
AcCoA
HMG-CoA
BioShack
idi
PMK
MPD
MK
ispA
ADS
AcAcCoA
Mev
Mev-PP
Mev-P
DMAPP
IPP
AMO
FPP
CPR
Artemisinin
Copyright: Alberto Sangiovanni Vincentelli 2011
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A Roadmap for Synthetic Biology
• An educational program (Berkeley (lead), Harvard, MIT and Stanford)
– To train the next generation of bioengineers
• A research program
– To determine how to set standards
– To learn how to develop standard components
• A BioFAB
– To construct biological components and offer them open source
• Applications
Copyright: Alberto Sangiovanni Vincentelli 2011
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Applications of Synthetic Biology
Energy Crop
•
•
•
Water saving
No fertilizer
Doubled photosynthetic efficiency
Biodiesel and biojet fuel
•
No compromise
•
Fully compatible with existing infrastructure
Natural product drugs
•
Capture all of the chemistry in nature
•
Construct a microbe that can
produce any natural product
Copyright: Alberto Sangiovanni Vincentelli 2011
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Amyris
• Amyris had its technological foundation in 2001 in the Keasling lab at Berkeley, when
Jay Keasling and his team of post-docs pioneered a methodology to produce
isopentenyl pyrophosphate, at rates with commercial potential, from yeast-fermented
sugars.
• Keasling’s magic bug, genetically enhanced from a soup of DNA obtained from bacteria
and the plant world, is a five-carbon base chemical and a high-value target in the world
of what is now known as the field of renewable chemicals — its a path to isoprenoids,
which are themselves a family of some 50,000 molecules that have applications or
pathways for pharmaceuticals, fragrances, cosmetics and fuels.
• Keasling filed the patent in 2001, and Amyris itself was eventually formed and funded by
2006 with $14.1 million in Series A investments from Kleiner Perkins and Khosla
Ventures among other early backers.
Copyright: Alberto Sangiovanni Vincentelli 2011
• IPO in 4° Quarter 2010
• From 680Mil cap to 1.265Bil today
Copyright: Alberto Sangiovanni Vincentelli 2011
The SCIENCE-Application Dilemma
Raffaello Sanzio, The Athens School
Copyright: Alberto Sangiovanni Vincentelli 2011
Teamwork!!!
Copyright: Alberto Sangiovanni Vincentelli 2011
Educational Challenge
Copyright: Alberto Sangiovanni Vincentelli 2011
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