Open innovation theory suggests the knowledge necessary to generate innovations come from outside a firm, and entrepreneurial businesses may be a valuable source of such knowledge.
Academics, such as London Business School professor Gary Dushnitsky, have found some validation of the theory, such as as “increases in corporate venture capital investment are associated with subsequent increases in future citation-weighted patenting rates”.
But can countries benefit more broadly? Theory would suggest similarly, as companies that are more innovative are likely to be growing and more acquisitive than takeover targets themselves and support the entrepreneurial ecosystem of scaleable businesses creating ideas and jobs.
Academics, such as Duke’s Vivek Wadhwa, who helped design StartUp Chile, again think they have found some answers. Wadhwa by email said: “The simple message was that, rather than focus on industry and clusters, we need to focus on people, people, people. With diversity, need, and open exchange of ideas comes innovation.”
In that spirit, countries as geographically diverse as South Korea and Brazil have been working out how they can connect their ecosystems to international venture investors in the way professionals, such as academic and corporate venture Erik Vermeulen from Philips, have been recommending (see link to our Early Stage Report for more on his insights).
South Korea last month invited corporate venturers to visit the country, while from 19 to 21 October, Global Corporate Venturing is helping* Brazil’s government with an event to bring international investors to meet the local entrepreneurs and venture capital firms.
Corporate investors active in Brazil, such as Qualcomm, have already found entrepreneurs able to succeed even if macro economic growth rates have been low or negative.
It is this element that is perhaps under-recognised. It is easier to track jobs and patents and investment rates than it is to look at the underlying economic efficiency of a country.
But, equally, it is the most promising sign for the future health of a country and the businesses and people that live and work there.
* for corporate venturers interested in speaking or attending the Sao Paulo, Brazil event on 19-21 October 2015 as a guest of Global Corporate Venturing, please contact James Mawson on jmawson@mawsonia.com – There is also a separate event in Menlo Park on 23 September.