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The Tough Get Growing: How to Succeed in a Down Economy

Moderator: Bo Fishback
Eugene Fitzgerald '85 Daphne Zohar Helen Greiner '89, SM '90: November 16, 2009; Running Time: 1:32:54

About the Lecture

About the Lecture

Stay calm, stick with your vision and business fundamentals, and you’ll survive and perhaps even thrive in rough economic times, counsel these entrepreneurial aces. In a conversation with the Kauffman Foundation’s Bo Fishback, panelists reflect on their experiences bringing novel tech products to market and new companies to fruition, in good times and bad.

Daphne Zohar attributes much of her company’s success to its unusual approach: PureTech Ventures is an institutional entrepreneur that “starts companies from scratch, backwards, looking for an unmet need.” Her team investigates thousands of technologies brewing in academic labs, then, says Zohar, “we brainstorm and come up with ideas ourselves, forming a company in a proactive way.” Zohar’s group seeks out the very best researchers from the start -- the first step in building what she calls an “entrepreneurial trinity: people, money, technology.” Zohar has been starting companies since she was a teenager, and is relatively unfazed by the current crisis. PureTech is bullish enough to have started a hair follicle company for such disorders as baldness and acne. It’s “an area where there are no solutions, but it’s clear that if there were something, a lot of people would be happy.”

As a veteran of a half dozen startups, Eugene Fitzgerald has developed a healthy respect for macroeconomic cycles. The contraction of funding opportunities in the current climate may not be such a bad thing. “When you’re in a phase with cheap capital around, you could form an idea incomplete on the technological level, and run with it…Cheap capital biases people toward selling their vision alone.” With investors hard to come by, entrepreneurs will have to ratchet down their expectations, and “build companies the old fashioned way, over a longer period of time.” A recession focuses people on researching and developing an idea so it “will sell tomorrow.” Fitzgerald also sees “lots of opportunity during a time of gigantic changes,” if entrepreneurs can remain fixed on an idea, settle for growing slowly, and reach that “magic point” when the economy starts to leap back.

As an 11-year-old Star Wars fan, Helen Greiner was “enthralled by robots.” When she started her first company right out of MIT in 1990, she had high ambitions but little commercial know-how -- Greiner lacked even a business plan -- and she saw almost a decade of hard knocks before securing venture capital for iRobot. During this period, which taught Greiner “the value of cash,” she partnered with Fortune 500 companies, and found work with DARPA and military contractors as well. All of these proved invaluable opportunities to learn about manufacturing and customers. When Greiner finally introduced her mainstream product, the Roomba vacuum, in the midst of recession, she encountered widespread skepticism. Says Greiner, “If you look at the market opportunity for robots when we started, you would have said zero.” But she notes that with disruptive technologies, you “have to use a little bit more imagination” and “do a lot of evangelizing rather than just selling.”

Lecture Details

Location: Kresge Auditorium

“People act really strange in a down economy. ... I’ve seen situations where the cash is about to run out, and they think they should lay everybody off, but they get through that time period. They’re suddenly viewed as a success. In these cycles, when you’re at the bottom, it looks like the end. You just have to work through that. If you’re able to maintain enthusiasm, passion and particularly ethics, it’s incredibly important.”

Daphne Zohar

About the Speakers

Moderator: Bo Fishback

Vice President of Entrepreneurship, Ewing Marion Kauffman Foundation

At the Kauffman Foundation, Bo Fishback's responsibilities include developing and advancing transformative programs that strengthen entrepreneurial engagement in the economy and help entrepreneurs succeed.

Fishback joined the Kauffman Foundation in 2006 as a director in the advancing innovation area, where he studied the country's best business accelerators and university-based commercialization programs. In 2007, he joined Kansas City, Mo.-based BioMed Valley Discoveries, a translational research and development organization affiliated with the Stowers Institute whose mission is to translate basic biomedical research into applications that improve human health. Fishback has been involved in a range of entrepreneurial initiatives. He is a founding team member of Orbis Biosciences, a drug delivery and particle fabrication company. Fishback is also a co-founder of Lightspeed Genomics, a next-generation genome sequencing company that was spun out of a research program at MIT. In addition, Fishback developed the Equity Simulation Tool, OwnYourVenture.com, an educational tool aimed at helping people understand the impact of raising equity financing.

Fishback received his B.S. in Biomedical Engineering from Southern Methodist University and earned an M.B.A. from the Harvard Business School.

Eugene Fitzgerald '85

Merton C. Flemings-SMA Professor, Department of Materials Science and Engineering, MIT

Eugene Fitzgerald researches the current limitations of electronic materials, especially those created by imperfections in materials such as point, line, and planar defects. Much of his group's efforts are focused on lattice-mismatched semiconductor systems, in which layers in electronic materials and devices have different lattice parameters.

Fitzgerald has a strong interest in the process of commercializing fundamental technology advances; he currently has 28 issued U.S. patents and several others pending. In 1998, he founded AmberWave LLC, which became Amberwave Systems Corporation in 1999. He has previously held positions as director, chairman of the board, and chairman emeritus at AmberWave.

Currently part of the founding team of Contour Semiconductor, Fitzgerald is also founder of Paradigm Research, LLC. The author and co-author of more than 150 technical papers, Fitzgerald has served on the editorial board of Materials Science and Engineering Reports since 1995, and in 2003 he was elected to the board of the Materials Research Society.

Daphne Zohar

Founder and Managing Partner, PureTech Ventures

Daphne Zohar leads PureTech Ventures, a Boston-based venture firm specializing in translating breakthrough research from top-tier academic institutions into therapies that will impact human health and well-being. PureTech’s senior partners include entrepreneurs and leaders from the highest echelon of pharma, biotech and academia. Zohar was named one of the world's top young innovators who will shape the future of technology by MIT's Technology Review magazine and one of the top "40 under 40" by the Boston Business Journal.

Zohar sits on the Boards of Directors of PureTech Ventures, Solace Pharmaceuticals (where she was Founding CEO), Follica Inc. (currently Founding CEO), Enlight Biosciences (a technology development company whose backers include Merck, Pfizer, Lilly, Johnson & Johnson, and Novartis), and Satori Pharmaceuticals (where she was Founding CEO). She also sits on the Technology Development Fund Advisory Board at Children's Hospital Boston, the Tufts University School of Medicine Advisory Committee for Drug Discovery and Development, and is an Editorial Advisor to Xconomy, a national technology news blog.

Helen Greiner '89, SM '90

CEO, The Droid Works
Co-founder, iRobot

Helen Greiner's startup company, The Droid Works, aims to be a “SkunkWorks” for robotics. She is co-founder of iRobot which she transformed, with business partners Colin Angle and Rod Brooks, from an MIT spin-off into a ~$300Million business and the global leader of practical robots. Greiner served as President of iRobot until 2004 and Chairman until October 2008. She developed the strategy for and led iRobot's entry into the military market place. She also ran iRobot's financing projects which included raising $35M venture capital and a $75M initial public offering.

Greiner was named by the Kennedy School at Harvard in conjunction with U.S. News and World Report as one of America's Best Leaders and was honored by the Association for Unmanned Vehicle Systems International(AUVSI) with the prestigious Pioneer Award. She has also been honored as a Technology Review magazine "Innovator for the Next Century," invited to the World Economic Forum as a Global Leader of Tomorrow, and has been awarded the DEMO God Award at the DEMO Conference. In 2003, she was named one of the Ernst and Young New England Entrepreneurs of the Year and has been inducted into the Women in Technology International (WITI) Hall of Fame.