Takreem El-Tohamy, GM, IBM Middle East and Africa

By Takreem El-Tohamy

There’s a wonderful word in Swahili that I think expresses one of the imperatives for the future of Africa. The word is “harambee.” It means pulling together, collaborating and supporting each other. I believe that one of the key factors in the ability of African countries to create sustainable and equitable economic growth will be the emergence of innovation ecosystems. Harambee perfectly captures an essential element of such ecosystems—the ability of institutions and individuals to pull together and build a mutually supportive environment.

Innovation ecosystems are complex organisms that are difficult to create yet tremendously powerful when they work. Think Silicon Valley. They require a melding of all of the capabilities of governments, businesses, financiers, universities, and individuals. Together, these organizations and individuals provide the web of support that makes it easier for startups to launch and grow quickly, and for established companies to innovate more aggressively. With that kind of support, African entrepreneurs and businesses will find it easier to produce new products and services, or even create whole new industries. You can think of an innovation ecosystem as a collective intelligence—harnessed for the good of society.

IBM is committed to helping Africa build successful innovation ecosystems. The latest sign of this willingness is our new IBM Innovation Center in Nairobi, Kenya. It’s a place where people from established companies, universities and startups can tap IBM technology and expertise to help them create solutions to the country’s business and societal challenges. We’re dedicated to helping Kenya fulfill its Vision 2030, which provides a strategy aimed at helping large numbers of Kenyans emerge into the middle class. Here’s a video about the center..

Click here to view the embedded video.

Our company has been doing business in Africa since 1921, when we helped out with the South African census. Today, we are expanding rapidly. We have offices in more than 20 African countries, including South Africa, Ghana, Nigeria, Kenya, Morocco and my native Egypt. The company has helped deliver everything from online banking and dependable mobile phone services to technologies for improving city services and government transparency.

In 2012, IBM established its first research laboratory in Africa—in Nairobi. It’s one of only one dozen such labs worldwide. Here’s a video about the impact we believe the Nairobi lab will have across Africa.

Click here to view the embedded video.

My IBM colleagues and I understand that expanding in Africa comes with a unique set of challenges. Our company must aid in building the capacities of Africa’s people and institutions—including knowledge, technology infrastructure, business sophistication and governance. These are the underpinnings of innovation ecosystems.

What’s the key role for IBM in Africa? To help feed the momentum. As a strategic partner with governments, universities, established businesses and startups, IBM can provide a wealth of technology know-how and problem-solving expertise that helps kick start initiatives and accelerate the speed of change.

Africa is coming into its own. The spirit of harambee is helping to drive progress. And IBM is dedicated to helping African countries, companies and individuals achieve their aspirations.

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Here’s an IBM Blue Paper about what it takes to build innovation ecosystems in Africa.

Technorati Tags: africa, IBM

Ben Goldhirsh, CEO, GOOD

By Ben Goldhirsh

Cloud computing is the new mantra for small businesses looking to go green.

That’s important because IT’s carbon footprint has been expanding. Between 2011 and 2020, carbon emissions for worldwide information communication technology (ICT) equipment and services are expected to double from 2 percent to 4 percent of total emissions, according to market research firm Verdantix.

Becoming a green business means more than just eliminating paper. It is about eliminating waste and reducing energy consumption. One easy step towards “going green” and significantly decreasing your carbon footprint is to eliminate or reduce energy-consuming on-premises equipment and move your IT to the cloud.

Cloud computing, storing and accessing data and software from remote servers, is changing the way the world does business. The cloud can be accessed from anywhere there’s an Internet connection. The cloud allows increasing amounts of Big Data generated from mobile devices and social channels to be captured, stored and continuously updated in one, central location. This dramatically reduces a business’ power consumption and in turn, energy bills.

When small companies run their own servers, idle time is a considerable problem. Small companies never use 100 percent of their computing power 100 percent of the time – it’s not even close. Most of the time, the server is idle, using power while not doing anything productive. Cloud technology means small companies use only the technology and energy they actually need. In other words, Cloud computing allows small, green businesses to work more efficiently and become even more eco-friendly.

In the U.S. alone, cloud computing will reduce carbon emissions by almost 86 million metric tons per year by 2020, generating a potential energy savings of more than $12 billion/year. Businesses, both established and start-ups, large or small can all go cloud, and go green, at the same time.

For example, large companies moving to the cloud can reduce energy consumption and carbon emissions by 30 percent. Small businesses save even more energy than their larger counterparts – up to 90 percent.

To help spur wide adoption of these technologies, cloud providers, and more specifically managed service providers, are uniquely positioned to assist small businesses in devising and implementing a Green IT strategy. Guidance from local technology providers goes a long way to help shape sustainable, socially responsible – and profitable – green businesses.

Gartner predicts the worldwide cloud computing market will grow to more than $14 billion in 2013. This growth indicates the small businesses that make up 65 percent of the total business community are actively pursuing cloud computing as a way to keep costs down, improve processes and transition to a mobile workforce.

In addition to the green benefits of cloud computing, such services are also lowering the barrier to entry into business for many SMBs, such as eliminating the need to establishing expensive in-house IT capabilities. Also, cloud computing levels the playing field and enables start-ups and SMBs to act like, and operate like, organizations of much greater size and scope.

With SMBs serving as the growth engine for many countries, cloud computing can spur the growth of local industries and local economies in environmentally friendly ways.

Technorati Tags: cloud, cloud computing, green cloud, ibm cloud, IBM Smarter Planet, smarter systems, SMB, start-ups

MoDe, short for Mobile Decisioning Africa Ltd., is a mobile micro-finance company based in Nairobi, Kenya, that provides mobile carriers with an online system for topping off their customers’ pre-paid subscriber accounts based not on cash payments but on credit. In emerging markets, the majority of mobile phone owners pay as they go, replenishing their accounts when need be at retail kiosks. But what happens when customers run out of time in the middle of a conversation, or when no kiosk is nearby? MoDe keeps them going.

MoDe is a prime example of the kind of innovation that is sweeping Africa these days. Most Africans don’t have PCs and Internet connections, so the mobile phone has become the go-to platform for communications and online services. Dozens of African companies have sprung up to create mobile applications that address the fundamental needs of Africans.

Click here to view the embedded video.

IBM’s SmartCamp program brings together startup entrepreneurs who focus on Smarter Planet-style business opportunities with veteran entrepreneurs, venture capitalists and other business professionals. The entrepreneurs pitch their business plans to judges, receive feedback, refine their pitches and, ultimately, present to larger audiences made up of business leaders and academics in the host cities. MoDe won a preliminary event in South Africa, one of seven held worldwide last year, before advancing to the finals.

Past participants in the contest have partnered with IBM to deliver new products and services to clients and to expand into new markets. In addition, startups have raised more than $90 million from venture capitalists.

The founders of MoDe hope that winning the contest will further accelerate their already rapid growth. Founded in 2010, the company is doing business in 15 countries in Africa. Now it hopes to expand into Latin American, Asia, Europe and even the United States. “This experience has taken us 15 years ahead in a matter of four months,” says Julian Kyula, MoDe co-founder and CEO. “We have met important people, developed relationships and made contacts that could lead to funding.” Co-founder Josphat Kinyua, who runs finance and business development, says the contest has given MoDe additional credibility with potential business partners. “How do you convince people to trust you? This helps,” he says.

For MoDe’s founders, airtime credit is just the beginning. They plan on adding other financial services to their portfolio in the coming months and years–including micro-credit for prepaid electric utilities, rail travel and television subscriptions.

Why is innovation exploding in Africa? For Kyula, the answer is simple:  “Solutions are found where problems exist,” he says. Africa still has lots of challenges, but, with entrepreneurs like Kyula and Kinyua on the case, you can expect to see innovations emerging in Africa that not only address basic human needs across the continent but which spread and make a difference globally in the years ahead.

Technorati Tags: IBM, Mobile Decisioning Africa, MoDe, smartcamp

Yet for Africa to fulfill it’s potential and emerge among the world’s economic tigers, social and business leaders agree that much more innovation must happen there. The continent’s cities, universities, entrepreneurs and commercial R&D organizations can become engines of innovation producing new products and services that are tailored for the African experience.  And,  in order to make this transition, African institutions and businesses–plus multinational corporations –must work together to create innovation ecosystems that foster this kind of creativity.

At IBM’s Smarter Planet Leadership Forum today in Nairobi, Kenya, CEO Ginni Rometty said IBM hopes to work collaboratively with the people and institutions in Africa: “We want to be seen as a citizen of the countries, essential to the government, companies and people.”  Rometty said IBM’s decision to locate an IBM Research laboratory on the continent–beginning with an office in Nairobi–sends the strong signal about the company’s commitment to Africa.

Click here to view the embedded video.

The message is clear: Rometty wants IBM to play an active role in building innovation ecosystems in Africa.

California’s Silicon Valley is the prototype innovation ecosystem. It benefitted from the combination of good universities, entrepreneurial companies, government incentives and robust supplies of venture capital. Many of other places have tried to copy Silicon Valley’s formula—some quite successfully, among them Bangalore, India, and Singapore.

Kenya is among the countries in Africa that have the potential of creating a vibrant innovation ecosystem. Students and entrepreneurs dream of tapping science and technology to solve social and business problems. Universities aim to expand their research and teaching programs in science, math and technology. Business leaders are creating startup incubators to encourage entrepreneurship—places like iHub, FabLab Nairobi and NaiLab

The government is playing a vital role, too, by making bold moves aimed at establishing Kenya as an information technology hub for East Africa. The government recently broke ground for Konzo Techno City, a new municipality being built from scratch south of Nairobi to bring research universities, corporations and government agencies together to support job creation, research collaboration and economic development. Another key move was the launch by the Kenya ICT Board of an incubation program for high-tech startups—including seed capital funding. “If we can build the skills and innovate, it will change the entire continent,” said Bitange Ndemo, permanent secretary of Kenya’s ministry of information and science.

But there’s an important role for foreign companies and academic institutions to play, as well—as partners with African institutions in making progress. IBM Research’s new research laboratory in Nairobi is the first basic scientific research lab to be established in Africa by a foreign multinational firm. We have allied with Catholic University of Eastern Africa to locate the lab on its Nairobi campus.The goal of the lab is to produce innovations within Africa and also bring in great ideas from IBM’s other 11 research labs around the world. “We want to create technology solutions optimized for Africa that can be exported to the rest of the developing world,” John Kelly, senior vice president and director of IBM Research said earlier this week.

While the first lab office is in Nairobi, IBM plans on expanding elsewhere around the continent and also performing collaborative research with a number of universities. Already, the company is engaging with the University of Nairobi and Strathmore University in collaborative programs where scientists from IBM will work with university faculty members on projects of mutual interest.

In another sign that Kenya is beginning to offer an attractive academic environment, Columbia University, one of the leading academic institutions in the United States, has set up Columbia Global Centre/Africa as a venue for research aimed at helping African nations reach their UN Millennium Development Goals.

We believe that foreign firms and institutions won’t succeed if they try to build islands of expertise. They must work with local universities on collaborative research and to improve the quality of degree programs. Sure, if this happens it will mean that IBM Research will have to compete vigorously to recruit and retain the most skilled and ambitious young people. But so be it. “This is a long term investment,” said Kelly. “We’re here to help build the skills and, hopefully, we’ll get our fair share of the most talented graduates.”

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Related Links

Read about the next technology leapfrogging opportunity in Africa: big data.

Find out how Reading Companion inspires a love of reading in South African schools.

Technorati Tags: africa, Ginni Rometty, IBM Research

Rev. Robert Dowd, CSC, University of Notre Dame

By Rev. Robert Dowd

When you combine private-sector expertise with top-notch education, future leaders enter the workforce with a foundation of unmatched strength and potential. As a leading Catholic research university, the University of Notre Dame works with a variety of partners, including corporations such as IBM, to support young people in their efforts to develop their leadership potential and the skills needed to contribute positively to the flourishing of their societies.

Recently, I have had the privilege of working on the Leadership Education and Development (or LEAD) program. This innovative pilot program brings together MBA students from East Africa with Notre Dame Faculty and students and business experts from IBM.  The program aims to help nurture the business leaders of the future through intense academic training and exposure to real-world business challenges. This program embodies Notre Dame’s commitment to developing the next generation of business leaders, technicians, scientists and social scientists and highlights the important role corporations can play in skill development.

As part of the program, six of East Africa’s top MBA students journeyed to South Bend to undertake a portion of their studies within our community. In a vibrant, successful intellectual interchange, they have taken classes alongside Notre Dame’s own MBA students and absorbed the real-life experiences of some of IBM’s most accomplished leaders.

A campus-wide collaboration, the LEAD program was kick started by the Ford Family Program in Human Development Studies and Solidarity at the Kellogg Institute for International Studies, the Mendoza College of Business, and the Engineering, Science, Technology and Entrepreneurship Masters (ESTEEM) Program, and IBM.

(L to R) Father Bob Dowd; Dorcas Magoba (Uganda Martyrs University); Garry Kizito (Makerere University Business School, Kampala, Uganda); Annrita Njiru (Strathmore University, Nairobi, Kenya); Peter Ochuodho (Strathmore University); Phiona Musoke (Makerere University Business School); and Dorcas Otieno (Strathmore University).

The curriculum, taught jointly by our business school faculty and IBM executives, combines a strong academic foundation with international business perspective. Not only have these future leaders gained insight into conducting business across borders, but they also equipped themselves to return home with skills for careers of which they, Notre Dame, their home universities, and future employers can be proud.

Hailing from Uganda and Kenya, the six LEAD students represent the next generation of Africa’s leaders, a young and highly capable group. These young people want to be problem solvers and job creators. They want to build accountable and responsive institutions in the private and public sector. Through our private-sector partnership with IBM, we hope to help them reach their goals of bringing about positive change in their societies. 

What have they told us about the LEAD experience? Gaining access to the inner workings of a global enterprise was invaluable. Learning from IBM executives who have built solid businesses in growth markets, some in their own countries, they dove down into the nitty gritty of leadership, skills, technologies, processes and management.

As any executive can attest, just as important as business acumen is the ability to build a wide net of relationships, augmenting one’s career and opening undiscovered doors. Our LEAD program has helped both African and American students form solid friendships outside of the classroom, sure to be continued for years.

As a result of this program, our current business school students gleaned a much more realistic picture of business outside of the U.S. As many of our graduates head into international ventures, we’ll see this enrichment well into the future. In addition, all of our students, whether from Africa, the U.S., or elsewhere, have had the rare opportunity to communicate across continents and cultures.

“We’ve had almost too many dinner invitations!” one student told us. Whether cheering at a Notre Dame football game (during its undefeated season!), volunteering at a tailgate concession stand, or sharing Thanksgiving dinner, the cross-cultural connections on both sides will not be forgotten.

Stay tuned for what the future holds for these promising achievers as they return to their home countries and put their skills to work. We know their success in Africa will exceed even the profound impact they made on us.

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Rev. Robert Dowd, CSC is a Notre Dame political scientist who researches religion, development, and political culture in Africa. He is also the director of the Ford Family Program in Human Development Studies and Solidarity, part of Notre Dame’s Kellogg Institute for International Studies.

Technorati Tags: Africa LEAD, East Africa, global warming, IBM Smarter Planet, Kenya, Notre Dame, smarter business

Deborah Magid, Director, Software Strategy, IBM Venture Capital Group

By Deborah Magid

When people think of the hotbeds for interesting startups, they usually think of Silicon Valley first. That’s where I’m from and where I handle venture capital and entrepreneur relationships for IBM Software Group. And it’s true, there are lots of cool startups here.

But guess where else they are – everywhere. That’s because governments at the national, state and city levels all over the world are recognizing that venture investment is a form of economic development that creates skilled jobs and commerce. And institutions around the globe are working hard to attract that investment. More than anything, that means creating a wonderful environment for entrepreneurs to live and work.

Take Chattanooga, Tenn., for example. I spent a few days there recently and it really opened my eyes. You might know of Chattanooga for its outdoor sports, friendly lifestyle, or the song made famous by Glenn Miller. Now Chattanooga is known for more than that. It has become the Gig City, ever since the local utility, EPB, installed gigabit internet into every home and business in 2009. At the moment, it’s the only place in the Western Hemisphere that can make that claim, but other cities are sure to follow.

Click here to view the embedded video.

With this bounty of bandwidth, a number of organizations in Chattanooga came together this year to ask the question: what new things can we create? This is a great question for IBM, of course, as we continue to help customers build a Smarter Planet. But it was a particularly good question in Chattanooga since it led the University of Tennessee at Chattanooga, the accelerators and incubators, the utility, local corporations and the municipal government to put something solid behind it. It asked teams of entrepreneurs and students to come together to build new things that take advantage of “the gig.” So, over the summer, they all came together, people from around the United States and beyond to compete in the first “GigTank” business plan competition, for which I was a judge. They were given cash and the gig, plus some valuable mentoring, and challenged to develop their ideas.

Last month, when all the ideas were completed, a group of investors and mentors from across the country gathered in Chattanooga to judge the results. Guessing from the number of investors in the audience of over 400, the winners will likely get some investment, too. Those of us who were judges were treated to an amazing variety of business plans, from gaming to music, from healthcare to augmented reality, and from research to language learning. The pitches themselves ranged from men and women in suits to a guy in a grass skirt singing into a coconut. Why shouldn’t entrepreneurship be fun!

Since being in Chattanooga, I’ve spent a week in Hong Kong and Singapore where the global nature of entrepreneurship really struck me. Of course, IBM is a global company, and we have partners in many places. And in my venture capital job, I’ve traveled to many places. And it’s a fascinating time for entrepreneurship.

In Singapore, IBM launched its ASEAN version of our program for startups called IBM Global Entrepreneur, including a SmartCamp event for our ASEAN startup company finalists. Our finalists came from Indonesia, Malaysia and Singapore. A 29 year-old entrepreneur from Surabaya created an app to get around traffic by using social networking, because, he says, everyone in Indonesia uses Twitter. In Hong Kong, I spoke at a Red Herring conference for Asian entrepreneurs. Their finalists came from Indonesia, Thailand, Malaysia, Singapore, China, India, Iraq, Yemen and Nepal. I asked a young man from Nepal if there were many startups there, and he said, yes, absolutely. A gentleman from Iraq told me about his telecom-related company and how he lives in the North and loves it. Iraq is great place to have a tech business, he informed me enthusiastically. And another entrepreneur, this time someone from Yemen, will be with me next week at our SmartCamp Istanbul as one of our mentors for the finalists from Turkey.

So, let there be no doubt about this point – entrepreneurship really is everywhere. From Tennessee to Turkey, forward-thinking cities are putting themselves on the start-up map by deliberating and fostering a supportive environment for entrepreneurs. Take a look around you – because, your city can do it, too!

Technorati Tags: Chattanooga, entrepreneur, entrepreneurs, Gig City, IBM, innovation, smartcamp, startup, VC

But technology can be a powerful asset in the fight against counterfeiting. And the good news is Sproxil and IBM are showing the way.

Click here to view the embedded video.

Click on the image below to open the slideshow version.

The IBM Curiosity Shop on Pinterest

Technorati Tags: africa, counterfeit drugs, healthcare, mobile, Smarter Healthcare, Sproxil, supply chain

In the U.S., large scale drug counterfeiting is rare, but in some parts of the world, particularly in developing nations, it’s rampant. This makes fighting treatable diseases like malaria – which kills a million people every year — extremely difficult. According to the World Health Organization, about 200,000 of the world’s malaria deaths alone can be linked to ineffective treatment resulting from counterfeit anti-malarials.

Pharmaceutical manufacturers and distributors globally are now experimenting with ways to combat counterfeiting by creating a smarter pharmaceutical supply. My company, Sproxil, provides a cloud-based service called Mobile Product Authentication™ (MPA) that allows consumers to use their mobile phones to determine if their medicine is genuine, at point of purchase, in a matter of seconds. Each package using the MPA service bears a label with a unique PIN as well as a text number. At the point of purchase, the consumer scratches the label to reveal the PIN code, then sends it to our authentication service via a free text message. Within seconds, a reply is sent back indicating whether the drug is genuine or counterfeit.

I’m proud that in January we reached a milestone within regions of Africa where consumers have used MPA technology one million times to verify their medication.

Click here to view the embedded video.

I’m equally proud of the partnerships that have enabled us to play a critical role in combating drug counterfeiting – from leading pharmaceutical manufacturers such as Merck and GlaxoSmithKline Johnson & Johnson, to technology leaders including IBM.

Through IBM’s SmartCamp program, we’ve made important connections with both potential clients and business partners. Using IBM ILOG technology, our pharmaceutical clients can now manage their data more easily through an enhanced dashboard view of all drug purchases and counterfeiting incidents, including charts and graphics based on real-time data.

Like medicine, information technology can be a life-saving tool, but it must be supported by national drug regulatory authorities committed to education, training and enforcement. We must also remember that while today’s technologies can outsmart counterfeiters, that may not be true tomorrow; counterfeiters desperately want to stay in what is unfortunately a profitable business.
Through a continuous cycle of collaboration – government creating and enforcing laws, pharmaceutical companies committed to protecting products and innovators leveraging technology to create cost-effective solutions – we can stay one step ahead.

Technorati Tags: Ashifi Gogo, ibm smartcamp, Sproxil

As globally-integrated firms like IBM are discovering, the roles of formal authority and hierarchy are declining in the workplace. What remains, however, is the core purpose they served – the need to influence others, to make a difference in other people’s actions and the thoughts and feelings that drive those actions.

Thus, the key challenge for IBM and others is this: if authority and hierarchy are waning, what are now the primary tools of influence available to those responsible for the performance of others? How, for example, can IBM’s Global Enablement Teams of senior leaders from mature economies best influence and develop the skills of local managers in emerging economies?

In this new world, we believe there are three key tools of influence, which we call the three imperatives of leadership:

Manage Yourself: Your ability to influence others begins with you and who you are as a person, and the most important feature here is whether people trust you. Are they confident you will do the right thing? Effective leaders now build relationships based on trust, not authority or social ties like friendship. And they do that by earning people’s confidence in their competence and character, the key components of trust. People trust someone who knows what to do and how to do it (competence) and who intends to do the right thing (character). Trust is the foundation of all influence other than coercion.

Manage Your Network: Interdependence has always been a hallmark of all organizations – no person or group works in isolation. But as organizations become more amorphous and fluid, as they spread around the world and embrace diverse cultures, this ability to connect and collaborate with those you don’t control grows even more crucial. It’s the only way to wield broad influence in the political environment that exists in all organizations.

Manage Your Team: Whether a group formally works for you or you assembled its members voluntarily for a specific reason, you must convert this group into a true team whose members are mutually committed to a common purpose – a group with such strong interpersonal ties that they believe “we” will succeed or fail together. When a team “clicks” in this way around a common purpose, its members are more committed, work harder, and are more productive and innovative because no member wants to let the others down. No leader can make a group into a team by decree. She can only foster the conditions that create a team and then manage the team through the social ties that bind members around a common purpose.

This strategic approach to management and leadership offers clear advantages:

The imperatives don’t depend on authority or hierarchy. They apply whether your responsibility for a group is assigned by an organization, conferred by members of the group itself, or assumed by you as you voluntarily step up to leadership.

The three imperatives are a better way to think about management and leadership than the hodge-podge of generic activities that traditionally defined those roles. Instead of performing 10-15 activities – motivating, controlling, communicating, and so on – you can focus on three key strategies that provide a simple but powerful framework for all your work. There’s no need to ask, “When do I apply the imperatives?” because the answer is, “Always – everything you do is an opportunity to apply and pursue them.”

The three imperatives are unlikely to change because they work across generations and cultures, all of which value trust, collaborative relationships, and commitment to a valued mutual purpose.

Finally, the imperatives are a guide to personal growth. They are the key areas that you must master on your years-long journey as a leader, guideposts you can use to assess your progress every day.

Linda A. Hill is Wallace Brett Donham Professor of Business Administration at Harvard Business School and chair of the school’s Leadership Initiative.  Kent Lineback, now a coach and writer, was a manager and executive for nearly 30 years. They are co-authors of Being the Boss: The 3 Imperatives for Becoming a Great Leader (Harvard Business Review Press, 2011)  www.beingtheboss.com

Here’s another point of view from the NextGen Leaders series, from Wharton’s Mike Useem.

Technorati Tags: emerging markets, Global, globalization, Harvard, Harvard Business School, Leadership, skills

Bill Reichert, managing director of Garage Technology Ventures

When venture capitalist Bill Reichert talks about his criteria for choosing tech start-ups to invest in, you may be surprised to find that ROI (return on investment) is but a small part of the conversation.

Instead, Reichert — who is managing director of Garage Technology Ventures, a leading early-stage venture capital firm in Palo Alto, California — points to other qualities that he considers essential to a start-up’s success.

By focusing more on an entrepreneur’s passion, vision and desire to do good in the world than on hard numbers and spreadsheets, Reichert and his peers represent a new paradigm for responsible investing.

“Perhaps the top indicator of success for an entrepreneurial team is that it’s motivated by some higher goal, beyond ROI,” Reichert said.

“ROI is key in every business plan, but what we look for from entrepreneurs is something that gives them a bigger goal than just being a little bit cheaper, a little bit faster, a little bit more economic for their potential customers,” he said.

That bigger purpose can be just about anything: helping people, building a sustainable business, cleaning the environment…you name it. “But whatever that motivation is, we know that’s what’s going to make for a successful company,” Reichert said.

In search of “enchantment”

When a start-up is driven by a higher goal, its appeal can be contagious. And that’s crucial to success.

“One of the big mistakes that entrepreneurs make in selling to customers or investors is believing that they make their decisions based on their brains, when in fact they make decisions based on their hearts,” Reichert said.

Reichert uses the term “enchantment” to describe a company’s ability to capture hearts and make investors and customers fall in love with it.

“Enchantment is that special quality that enables an entrepreneur to change not just minds, but also change hearts and ultimately change behavior,” Reichert said. “And ultimately that’s what you’ve got to do — change behavior to cause an investor to invest or cause a buyer to buy.”

Global from the get-go

While intangibles like passion and enchantment are crucial to Reichert, so are practical concerns that point to a company’s ability to compete and thrive. In today’s world, a tech start-up must be innately global in how it thinks and possess a keen awareness of the entire ecosystem in which it operates, Reichert explained.

“We’re not interested in start-ups that have a global strategy somewhere down the line,” Reichert said. “We look for entrepreneurial teams that can tap right into the opportunity that global connectivity gives us today.”

These entrepreneurs must be able to capitalize on the talent, knowledge and markets available to them in every corner of the planet; skillfully collaborate across a global value chain; and exploit end-to-end systems across the full spectrum of platforms, networks, technologies and devices.

“For today’s high-tech entrepreneur, success is not so much about being a better inventor. It’s about innovating across the value chain of any given business,” Reichert said. “Success means being connected and being aware of opportunities to partner with others or to integrate other technologies up and down the value chain and then across geographies.”

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Video: Bill Reichert, Entrepreneurship for a Smarter Planet

Click here to view the embedded video.

Bill Reichert, managing director of the Silicon Valley venture capital firm Garage Technology Ventures, talks about what it takes to be a successful entrepreneur, innovator and leader in today’s global economy.

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A great time for tech start-ups

Reichert has been in the venture capital world for nearly 15 years — through the dot.com boom and bust, through flush times, up to the present. While capital is tougher to come by now, given the global economic downturn, it’s nonetheless a great time for tech start-ups.

“There is an infinite number of opportunities for innovation out there where entrepreneurs can come up with solutions that will make the world a better place and that will enable them to build highly successful companies,” Reichert said.

“If you’re an entrepreneur who possesses the necessary ambition and boldness, there’s never been a better time to start a business to address some of those opportunities and attack some of the world’s problems,” he said.

Technorati Tags: Bill Reichert, entrepreneurs, Garage Technology Ventures, start-ups, venture capital