Gen Y Innovators: Doing More with Less

This month, MIT's prestigious magazine, Technology Review, profiles its annual line-up of “35 Innovators Under 35”. The list reveals a kaleidoscope of nationalities. Entrepreneurial spirits as young as 24 working magic at America’s universities, national labs, corporations and start-ups. Their ambitions are audacious and their accomplishments dazzling. They’re re-programming cells to cure disease, engineering viruses to destroy bio-films, developing software to help communities in crisis, and powering electronics with human motions. And there's a strong philanthropic flair to their efforts.

The list is an inspiring reminder that the pool of next-generation scientists and technologists is deep and rich. And that America's global leadership profile continues to be defined by the quality of its ideas.

Equally inspiring is that in spite of dismal capital markets, the pace of innovation hasn’t changed. Thin funding and razor-tight budgets, notwithstanding, these young entrepreneurs continue to transport clever ideas out of the lab and into commercialization. Which means that most are doing more with less. Probably much less than many veteran entrepreneurs. Other than the intrapreneurs at Google and Microsoft, few on this list will likely benefit from the type of gigantic funding rounds that saturated the tech sector not so long ago. The $100M+ payouts to Silicon Valley clean-tech companies must seem like an oddity to the young inventors – unless they’re being courted by Better Place.

With their lean operating models and frugal business cultures, these star innovators have more to pass along than just brilliant ideas. In today’s start-up land “doing more with less” is an absolute imperative, not just to appease demanding VCs, but because the money simply isn’t there. According to the National Venture Capital Association, raising funds is tougher than ever for US VCs as investors abandon this traditional investment channel and pour money into emerging markets or other vehicles. In the second quarter of 2010, just $1.9 billion was raised by 38 VC funds – a 47% decline when compared to the first quarter which saw 38 funds raise $3.7 billion. Worse yet, it is the lowest by dollar commitment since the third quarter of 2003. Not surprisingly, the number of US venture firms is expected to decrease over the next 5 years. This means less money for start-ups.

But the gloomy VC data points are probably not top of mind for MIT’s humanitarian [innovator] of the year, Kenya-born David Kobia. Building an inventive way to mobilize communities in crisis was just the start for this former University of Alabama student. He’s got much bigger aspirations. He wants to grow Kenya’s economy by harnessing Nairobi’s burgeoning software talent. He tells individuals at his new innovation center in the East African city that it’s their duty to participate in the community by building their own business. I suspect he also told them they needed to do it on a shoe-string budget.

A master of doing more with less. And a tough act to follow.