TECHONOMY 2013 (Squaring the Circle!)

Co-founder of Twitter to speak at Techonomy

By John Gallagher Detroit Free Press Business Writer

   Some of the nation’s top high-tech leaders will visit Detroit today for Techonomy, a daylong examination of how technology and innovation can help improve economic growth and urban revival.

   Headlining the conference will be Jack Dorsey, co-founder of Twitter and CEO of Square, a digital payment service, who spoke last year.

   Also speaking will be Gov. Rick Snyder and Dan Gilbert, the founder and chairman of Quicken Loans.

   This year’s Techonomy, the second annual in Detroit, will be held at Wayne State University. It will focus on the national lack of educational opportunities.

   A complete agenda can be found at techonomy.com  .

   Contact John Gallagher: 313-222-5173 or gallagher@freepress.com  . Follow him on Twitter  @jgallagherfreep.com  .


TECHONOMY AGENDA (TODAY)

7:45 - 8:30am

Registration

Breakfast & Coffee

Hosted by Detroit Venture Partners

8:30 - 8:45am

Welcome & Opening Remarks

Michael A. Finney, Michigan Economic Development Corporation (MEDC)
David Kirkpatrick, Techonomy Media
M. Roy Wilson, Wayne State University

8:45 – 9:30am

Education 2.0 for Americans 2.0

John Wm. Covington, Education Achievement Authority of Michigan
Marlin Page, Sisters Code
Hector Ruiz, Advanced Nanotechnology Solutions, Inc. (ANS)
Tae Yoo, CiscoModerator: David Kirkpatrick, Techonomy Media

9:30 - 9:40am

What Makes a City Great?

Lessons from around the globe.Patrick Finn, McKinsey & Company

9:40 - 10:05am

City Re-Vision: Towards a Techonomic Detroit

Dan Gilbert, Quicken Loans
Bruce J. Katz, Brookings InstitutionModerator: Edward Luce, Financial Times

10:05 - 10:30am

A Conversation with Governor Rick Snyder

Rick Snyder, State of MichiganInterviewer: David Kirkpatrick, Techonomy Media

10:30 - 11:00am

Networking Break

11:00 - 11:05am

Welcome Back

David Kirkpatrick, Techonomy Media

11:05 - 11:50am

Where Are the Jobs?

Nolan Finley, The Detroit News
Felix Ortiz, Viridis Learning Inc.
Joel D. Tauber, University of Michigan
Carol Williams, Dow ChemicalModerator: Susan Lund, McKinsey Global Institute (MGI)

11:50am - 12:10pm

Keeping the U.S. Competitive in a Hyper-Connected World

Nilmini Rubin, U.S. House of Representatives Committee on Foreign AffairsInterviewer: David Kirkpatrick, Techonomy Media

12:10 - 12:45pm

Everybody’s Starting Something

Jocelyn Benson, Wayne State University
Josh Linkner, Detroit Venture Partners
Andrew Yang, Venture for AmericaModerator: Tom Walsh, Detroit Free Press

12:45 - 1:00pm

The New People Rules in a Virtual World

Keith Ferrazzi, Ferrazzi Greenlight

1:00 - 2:00pm

Lunch

Hosted by Ford

2:00 - 2:15pm

Switch Break

2:15 - 3:15pm

Techonomy Labs

1. Business & the Economy in an Internet + Everything World

Amit Kumar, Bitponics
Michael Mandel, Progressive Policy Institute
Vishakha Radia, Cisco Consulting Services
Greg Ross, General MotorsModerator: Emily Chang, Bloomberg Television

2. Civic Startups: Engage & Improve

Nick Bowden, MindMixer
Lawrence J. Morrissey, City of Rockford, Illinois
Jerry Paffendorf, LOVELAND Technologies
Stephen Walter, Engagement Game LabModerator: Zachary Karabell, River Twice Research

3. Connecting Detroit: 8 Mile to Downtown

Matt Clayson, Detroit Creative Corridor Center
Brandon A. Jessup, Michigan Forward Urban Affairs Group
Catherine Kelly, Michigan Citizen
Brian Mulloy, ApigeeModerator: John Gallagher, Detroit Free Press

4. Reimagining Education

In partnership with Kaplan UniversityCathy Lewis Long, The Sprout Fund
Damien Rocchi, Grand Circus
Annis Stubbs, Teach For America - Detroit
Betty Vandenbosch, Kaplan UniversityModerator: Ingrid Jacques, The Detroit News

5. The 5 Undeniable Rules of Changing Human Behavior

Keith Ferrazzi, Ferrazzi Greenlight

3:15 - 3:30pm

Switch Break

3:30 - 3:35pm

Welcome Back

David Kirkpatrick, Techonomy Media

3:35 - 3:55pm

A New Age of Manufacturing

Rodney Brooks, Rethink RoboticsInterviewer: Zachary Karabell, River Twice Research

3:55 - 4:35pm

Can the Maker Movement Re-Make America?

Matt Clayson, Detroit Creative Corridor Center
Chad Dickerson, Etsy
K. Venkatesh Prasad, Ford Research & Innovation
Marleen Vogelaar, ShapewaysModerator: Lou Rassey, McKinsey & Company

4:35 - 4:50pm

The Push for the Prize

Jean Case, Case FoundationInterviewer: Jeff Green, Bloomberg News

4:50 - 5:30pm

Turbo Charging Detroit’s Techonomy

Session moderated by Jack Dorsey and David KirkpatrickCatherine Kelly, Michigan Citizen
Scott Moloney, Treat Dreams
Alex Southern, GrowDetroit

5:30pm

Closing Remarks

5:45pm - 6:30pm

Reception

Hosted by Quicken Loans

- See more at: http://techonomy.com/conf/13-detroit/agenda/#tuesday-september-17

Capitialism & Innovation (Update: Creating an Entrepreneurial Culture)

ECONOMIC VIEW

Why Innovation Is Still Capitalism’s Star

By ROBERT J. SHILLER

Published: August 17, 2013

CAPITALISM is culture. To sustain it, laws and institutions are important, but the more fundamental role is played by the basic human spirit of independence and initiative.

Enlarge This Image

Morgan Schweitzer

The decisive role of the “spirit of capitalism” is an old concept, going back at least to Max Weber, but it needs refreshing today with new evidence and new thinking. Edmund S. Phelps, a professor of economics at Columbia University and a Nobel laureate, has written an interesting new book on the subject. It’s called “Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge and Change” (Princeton University Press), and it contains a complex new analysis of the importance of an entrepreneurial culture.

Professor Phelps discerns a troubling trend in many countries, however, even the United States. He is worried about corporatism, a political philosophy in which economic activity is controlled by large interest groups or the government. Once corporatism takes hold in a society, he says, people don’t adequately appreciate the contributions and the travails of individuals who create and innovate. An economy with a corporatist culture can copy and even outgrow others for a while, he says, but, in the end, it will always be left behind. Only an entrepreneurial culture can lead.

Is the United States really becoming corporatist? I don’t entirely agree with such a notion. Even so, President Obama has been talking a lot about innovation as a job creator this year, and while some of his intentions may be good, I’m afraid that some of his proposals look a little corporatist, and might suppress individual initiative.

In his State of the Union address in January, for example, the president proposed that the government should create 15 new “innovation institutes,” modeled on a public-private partnership that he helped start in Youngstown, Ohio, that is devoted to developing 3-D printers. There was more in this vein in his administration’s 2014 budget, offered in April. And in a speech on July 30 in Chattanooga, Tenn., Mr. Obama suggested extending the number of innovation institutes to 45, or almost one for every state. The institutes, he said, would be “getting businesses, universities, communities all to work together to develop centers of high-tech industries all throughout the United States.”

Will such measures work? Should the government really be trying to start a 3-D printer center? And why in Youngstown? It is easy to be skeptical of such a plan, especially when it was started in a swing state just before the presidential election. Web sites of the two senators and two representatives introducing bills this month supporting the president’s latest proposals are suggesting, in not-too-subtle terms, that the legislation would bring jobs to their own states.

Successful companies aren’t usually started this way. Professor Phelps, citing a McKinsey study, suggests that in free-market capitalism, “from 10,000 business ideas, 1,000 firms are founded, 100 receive venture capital, 20 go on to raise capital in an initial public offering, and two become market leaders.” It is easy to doubt, as Professor Phelps does, that the odds are favorable for a Youngstown 3-D printer center.

How you view the innovation institutes, and the topic of capitalism and culture, may depend on your own experience. Many people have never seen the hatching of a successful business idea. That makes it hard to judge the subtle changes that may be occurring in the nation’s culture and in its potential for innovation.

My own business experience has certainly helped shape my thinking. Yale, like many other universities, sensibly allows its professors to spend limited time in business, providing the opportunity for faculty members to gain valuable experience outside of the ivory tower and to offer their technical skill to the business world.

In 1991, I started a business with Karl Case, an economics professor at Wellesley College, and Allan Weiss, a former student of mine at Yale. We called it Case Shiller Weiss, Inc., and it was devoted to an innovation we dreamed up. The idea was a new “repeat sale” home price index — which would track the changes in the value of the same houses over time.

At the time, this was an entirely new line of business. And, at first, that posed a problem: we were spectacularly unsuccessful in raising money. We talked to venture capitalists and their committees, to no avail. They just didn’t seem to get our business plan. We must have appeared odd to them — overly academic, perhaps. One remarked that we’d do better proposing a new shopping center.

But we went ahead with our idea anyway. At first, Allan worked without pay. A friend of Professor Case, Chuck Longfield, contributed some money. And in 1995, I took out a home equity line of credit on my house in New Haven so I could personally lend more money to help keep our business afloat. The experience was stressful, especially when adding it to the burdens of my main job, as a professor. I have much to thank my wife, Virginia, for her tolerance of my overwork and my worrying, and for allowing me to put our family savings at risk.

In the end, our business was successful, and I think a big part of it was that we relied on our own ideas and energy and, to a large extent, our own money. In 2002, we sold the business to Fiserv Inc., then licensed Standard & Poor’s to create what are now known as the S&P/Case-Shiller Home Price Indices. In 2006, the Chicago Mercantile Exchange began trading futures on 11 of our indexes. Fiserv sold the index business to CoreLogic early this year.

In short, our business made its mark without any help from the government.

This little real-life experiment convinces me that committees of experts, even at smart venture capital firms, will often not recognize real innovation. I think that America’s business success through the decades has occurred because we have so many people with specialized knowledge who are willing to put their money, time and resources on the line for ideas that can’t be proved to a committee.

THAT experience may also help explain why I think the new crowdfunding initiative, started by the Jobs Act that the president signed last year, is an exciting step forward. It’s all about finding and mobilizing people who really understand specific, hard-to-prove ideas for important investments.

At the same time, other of my experiences incline me to think that government-appointed committees of experts can help set the stage for an entrepreneurial culture, under certain limited circumstances.

Long before I started any commercial ventures of my own, I received some federal government support — in the form of National Science Foundation research grants, awarded to me decades ago as a young professor. They allowed me to do research, and though it was not directly related to my later business endeavors, the process developed my expertise and reinforced a sense of entrepreneurial opportunity.

These grants were awarded competitively, based on the quality of the proposals, and gave me experience with a system focused on creating opportunities for those who try hard. Later, from 1983 to 1985, I evaluated others’ proposals when I served on the foundation’s panel for economics. Observing the process from the government side convinced me that the foundation really works. Maybe it’s because the panelists are chosen from successful scientists, who serve anonymously out of public spirit.

In any case, as Professor Phelps has argued, direct government involvement in capitalism is a delicate thing. The system’s success depends on subtle cultural factors — and these require careful nurturing.

Robert J. Shiller is Sterling Professor of Economics at Yale.

JOHN DEWEY: CAN YOU HEAR ME NOW? (No matter, Technological Disruption has a history of Leveling All Playing Fields!)

Joanne Weiss, The U.S. Department of Education's chief of staff, notes that "the biggest challenge for us is that education has been a place that is wildly resistant to innovation....It was designed very much to resist the status quo so that crazy fads wouldn't use kids as quinea pigs. And the problem with that is now when we desperately are in need of innovation, we have built a system that is really, really good at repelling it."

Spatial Reasoning: Unlocking the Creativity & Innovation Capacity Puzzle (A GIFT that Keeps On GIVING!)

Study Finds Spatial Skill Is Early Sign of Creativity

By DOUGLAS QUENQUA

Published: July 15, 2013

A gift for spatial reasoning — the kind that may inspire an imaginative child to dismantle a clock or the family refrigerator — may be a greater predictor of future creativity or innovation than math or verbal skills, particularly in math, science and related fields, according to a study published Monday in the journal Psychological Science.

The study looked at the professional success of people who, as 13-year-olds, had taken both the SAT, because they had been flagged as particularly gifted, as well as the Differential Aptitude Test. That exam measures spatial relations skills, the ability to visualize and manipulate two-and three-dimensional objects. While math and verbal scores proved to be an accurate predictor of the students’ later accomplishments, adding spatial ability scores significantly increased the accuracy.

The researchers, from Vanderbilt University in Nashville, said their findings make a strong case for rewriting standardized tests like the SAT and ACT to focus more on spatial ability, to help identify children who excel in this area and foster their talents.

“Evidence has been mounting over several decades that spatial ability gives us something that we don’t capture with traditional measures used in educational selection,” said David Lubinski, the lead author of the study and a psychologist at Vanderbilt. “We could be losing some modern-day Edisons and Fords.”

Following up on a study from the 1970s, Dr. Lubinski and his colleagues tracked the professional progress of 563 students who had scored in the top 0.5 percent on the SAT 30 years ago, when they were 13. At the time, the students had also taken the Differential Aptitude Test.

Years later, the children who had scored exceptionally high on the SAT also tended to be high achievers — not surprisingly — measured in terms of the scholarly papers they had published and patents that they held. But there was an even higher correlation with success among those who had also scored highest on the spatial relations test, which the researchers judged to be a critical diagnostic for achievement in technology, engineering, math and science.

Cognitive psychologists have long suspected that spatial ability — sometimes referred to as the “orphan ability” for its tendency to go undetected — is key to success in technical fields. Earlier studies have shown that students with a high spatial aptitude are not only overrepresented in those fields, but may receive little guidance in high school and underachieve as a result. (Note to parents: Legos and chemistry sets are considered good gifts for the spatial relations set.)

The correlation has “been suspected, but not as well researched” as the predictive power of math skills, said David Geary, a psychologist at the University of Missouri, who was not involved in the study, which was funded by the John Templeton Foundation. The new research is significant, he said, for showing that “high levels of performance in STEM fields” — science, technology, engineering and math — “are not simply related to math abilities.”

Testing spatial aptitude is not particularly difficult, Dr. Geary added, but is simply not part of standardized testing because it is considered a cognitive function — the realm of I.Q. and intelligence tests — and is not typically a skill taught in school.

“It’s not like math or English, it’s not part of an academic curriculum,” he said. “It’s more of a basic competence. For that reason it just wasn’t on people’s minds when developing these tests.”

It is also a competence more associated with men than women. In the current study, boys greatly outnumbered girls, 393 to 170, reflecting the original scores of the students in the ’70s. But the study found no difference in the levels of adult achievement, said Dr. Lubinski, though the women were more likely than the men to work in medicine and the social sciences.

Detroit Entrepreneurial Tech Company's (FastCompany Update: @Detroit Bankruptcy)

TECHNOLOGY

DETROIT IS GOING BANKRUPT--BUT ITS TECH COMMUNITY IS GOING STRONG

DETROIT JUST BECAME THE LARGEST U.S. CITY TO FILE FOR CHAPTER 9 BANKRUPTCY. BUT ITS TECH ENTREPRENEURS SAY THERE'S NEVER BEEN A MORE PROMISING TIME FOR STARTUP LIFE IN THE MOTOR CITY.

Yesterday, the city of Detroit filed for Chapter 9 bankruptcy, the largest city in the U.S. ever to do so. By some estimates, the city owes as much as $20 billion. But the news is unlikely to halt the growth of Detroit's burgeoning tech scene, according to some of its entrepreneurs.

"We don't really see this bankruptcy as being anything but a footnote in the newspaper," says Jay Gierak, a founder of the Detroit-based social recommendations site, Stik. "It feels so far afield from the excitement of people moving into brand-new apartment buildings and businesses renting new spaces here."

SAVING DETROIT

• Detroit's Bankruptcy Filing Isn't A Fiasco, It's A Pivot
• How A Young Community Of Entrepreneurs Is Rebuilding Detroit
• Remaking Detroit: Can Creative Companies Save An American City On The Brink?
• A Haunting Look At Detroit, Its Inhabitants, And Its Attempts At Revival
• Meet The Makers: Rebuilding Detroit By Hand
• What Detroit’s Incredible Crime Problems Show Us About The Bleak Future Of Police
• Beautifully Mashed-Up Photos Show The Glory And Wreckage Of Detroit

Stik is one of dozens of Detroit-based tech startups that have called the city's privately owned M@dison Building home. A 50,000-square-foot building that once housed Detroit's first major movie theater, the M@dison Building opened last January and has become an epicenter of the city's tech scene, hosting a bustling mix of about 300 entrepreneurs, investors, and developers, includingTwitter. Several startups that began within the M@dison have grown so much they have begun to move into buildings in other parts of the city.

Gierak and his cofounder decided to move Stik's four-person operation from San Francisco to Detroit in October of last year. Stik, which recently moved out of the M@dison Building into an adjacent space, has since grown to 20 employees. Gierak says he has had little trouble finding tech talent in this city, and he doesn't have to worry about competing with the bloated salary offers and sexiness factor of the Valley's tech behemoths--not just Google,Facebook, and Twitter, but also the startups du jour, such as Airbnb and Square.

"We are the Facebook or the Twitter of the area," Gierak says. "We can get unbelievably good people who are extremely talented and think we're the coolest job in town, as opposed to being the 550th coolest job in town back in San Francisco."

SILICON VALLEY IS A GREAT PLACE TO BE IF YOU'RE IN THE 1% OF TECH STARTUPS. BUT IF YOU'RE IN THE OTHER 99%, YOU SPEND ALL YOUR TIME TRYING TO FIND TALENT, AND NOT ENOUGH BUILDING A BUSINESS." --JAY GIERAK, STIK

Even though the number of startups in Detroit is relatively small--the M@dison Building, one of the city's main tech thoroughfares, houses around 35 companies--the young, college-educated professionals who choose to look for work here often have the chance to land higher-impact roles at these startups than they might find at comparable companies in larger urban tech hubs such as San Francisco, Chicago, or New York.

"If you're a young, smart person staying in Detroit there's an unbelievably collaborative and welcome culture here," says Jacob Smith, the 25-year-old director of business development at calendaring app UpTo, which is housed in the M@dison Building. "You can make a bigger impact quicker. The rent is cheaper. We get media coverage simply because we're a company that's actually choosing to be in Detroit."

IF YOU'RE TRYING TO MAKE IT IN THE TECH COMMUNITY, I CAN'T IMAGINE WHY YOU WOULDN'T WANT TO DO IT IN DETROIT. YOU CAN MAKE A BIGGER IMPACT QUICKER. THE RENT IS CHEAPER. WE GET MEDIA COVERAGE SIMPLY BECAUSE WE'RE A COMPANY THAT'S ACTUALLY CHOOSING TO BE IN DETROIT.

Neverthless, the tech scene in Detroit does face challenges. The most recent Census data shows Detroit has just 11,000 young professionals between 25 and 34 who hold at least a bachelor's degree, compared to Chicago's 250,000. Michigan is one of four states that had fewer young professionals in 2011 than it did in 2006. And, as Fast Company's Chuck Salter reports:

The city, strapped for resources, isn't doing much of anything for [startups]. In fact, the local government looms as a threat to their progress. "If the city can't get back on track, the little ecosystem that's happening here is going to stall," says Marsh.

To combat these grim statistics, new organizations like the Green Garage coworking space and Crowd 313, a University of Michigan organization that connects university students with Detroit's business and cultural scenes, are expanding on the M@dison Building's groundwork to attract and keep more young talent in the city. And Dan Gilbert, the M@dison Building owner and billionaire founder of Detroit's Quicken Loans, the country's third-largest mortgage provider, is continuing to attract more investments in the city's buildings, tech companies, and small businesses.

Gierak, the Stik founder, says he was recently asked whether Detroit will bounce back. In response, he recited the city's motto, coined after the famous 1805 fire that ravaged the city: "We Hope For Better Things; It Shall Rise From the Ashes."

MODEL: 21st Century Digital Learning Environments & Studio Classrooms (@AKUPENDA Transformation Conversation)

Career Help: TechShop

Studio unites creatives in unique, collaborative environment

   If you want to work out your body, you join a fitness center where you can use the equipment and be motivated by others sweating it out. If you want to work out your brain,you join TechShop,where you can use professional machines and software and be inspired by other creative types thinking it out.

   At least that’s how Will Brick, general manager of TechShop Detroit in Allen Park,sees it. “There are six TechShops in the country, and every one at its core is an open-to-the-public, do-it-yourself workshop and prototyping studio,” he says.“It’s like a gym for people who like to make stuff.”

   The Allen Park location –it opened a year ago and was the first TechShop outside California–is a 17,000-square-foot facility that includes wood, metal, textile and welding workshops, along with state-of-the-art equipment such as laser cutters,a waterjet cutter and 3-D printers.There also is top of-the-line design software, including the entire Autodesk Design Suite.

   But just as important as the equipment is the collaborative environment TechShop is dedicated to fostering, Brick says. Everything in the building is centered around the Community Hub, which contains project areas with large worktables ideal for working with others. The shop attracts everyone from college grads who no longer have access to campus equipment to retirees looking to start their own businesses to those looking fora career change.Because storage space is available, artisans can even run their businesses entirely from the center.

   Ford Motor Co. also has an investment, buying large blocks of memberships to give to staff members and encouraging employees to work on prototypes at the center, according to Brick.

   “Weget folks from different backgrounds and interests who come in and work together on projects,” Brick says. “We really encourage spontaneous collaboration.The people who come here represent a huge breadth and cross section of experience. They are people who wouldn’t have met otherwise.”

   TechShops are membership-based;the Detroit-area location currently has approximately 900 members, Brick says. For around $100 a month, members can use and reserve the shop’s tools and equipment after completing equipment-specific Safety and Basic Use(SBU) classes.Classes average two and a half hours and usually have four to six students; cost typically runs from$40 to $100. (Veterans currently are eligible for free one-year memberships and $350 worth of group classes,see sidebar.)“No prior knowledge of the equipmentis needed,” Brick says. “We are trying to demystify the equipment and let people know it’s not only for a certain person or certain kind of work.”

   Trained staff members also are available full time to help develop ideas and improve techni cal skills. The shop is open from 10 a.m. to 9 p.m. daily, and free tours are available at the top of every hour.

   Brick encourages anyone who’s interested in the center to come,take the short tour and really get a feel for the spirit of collaboration and innovation that permeates throughout.

   “We havepeople who have fantastici deas,” he says.“Where else can you introduce a young artist coming up with ideas to a 30-year tool-and-die worker,and they end up working together?”

TechShop Detroit is amembership-based, do-it-yourself workshop and prototyping studio located at 800 Republic in Allen Park. There are five other locations across the U.S., with three more in the planning stages.

Good to Know

   › TechShop Detroitisopen10 a.m. to 9p.m.daily.Freetours are available everyhour.

   › Theshopwill host aPost-Maker FaireOpenHouse from 10 a.m.-7 p.m. Saturday,Aug.3.The eventis opentothe public and will include toursand achancetomeetstaff.

   › Formoreinfo, visitwww.techshop.  com  , email info.dt@techshop.com   or call 313-583-3831.