It’s only day 2 of our working week and I already feel like a seasoned New Yorker; using several subway lines to get to the exact point needed, being always on time, walking across the street a second before the white light opens (yes, their green light is actually white). The SUNY classroom, once the battle over the AC controls was won, feels like home (a place on Frankel Leo utca).
The presenter of the day was Alejandro Crawford, co-founder of Acceleration Group and teacher at NYU. Another very interesting character, that used the pitch and volume of his voice to keep everyone onboard during his presentation. The topic was Innovation in NYC and he did a good job of covering both the theoretical and practical aspects of the innovation process. He also touched on the important part of how a innovative company should prepare itself for a growth on a large scale. His examples about Amazon, Walmart and Barnes&Nobles helped us better understand the concepts of Long tail, sweet spots in the distribution chain, and collaborative filtering. The major takeaway from his presentation was that companies should pivot and take position on the market before the wave of the technological innovation hits them. If you are well positioned you can ride the wave, if not you will drown. His model for preparing a company for innovation includes 7 steps given below:
1. Cash reserves & capital availability
2. Access to key markets & channels
3. Pipeline and process for innovation
4. Talent, tools, training & team buy-in
5. User base & basis for learning from users
6. Relationships with partners, vendors, stakeholders
7. Economics for monetizing & scaling up
The second part of the day was devoted to a company visit to General Atlantic, private equity firm based in NYC. They are one of the biggest firms that are investing in growth, that is, on the longer run looking for a good ROI (they don’t have a predetermined exit period). They have a capital base of 18 bln$ funded mainly by High Net-worth Families or endowments. From their 10 offices around the world they invest half of their yearly 2 bln$ in foreign companies. They do proprietory deals and don’t auction for companies because that gives them enough time with the company to perform a solid due diligence. After the investment, their inhouse IT, HR, M&A resources are available to help the acquired companies grow with the expected rate. Their investments vary from 75-350 mln$ and expect minimum 20% ROI.
Based on the company visits in the first two days, I can safely conclude that the horizon for the American economy has cleared after the big crisis in 2008 and that there is very little uncertainty about the future. Hope tomorrow’s class and company visit bring even more insight into the business climate in the USA that inevitably affects the business world across the globe.