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Chattanooga's Got More Money for Broadband Apps

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Seems like everywhere you turn, someone wants to throw money at you if you have a great broadband app that takes advantage of gigabit networks. Are you going to step up for a chance for mo' money, mo' money, mo' money?

 

John Wilson, Co-founder and former president of flexible display maker NanoLumens, Inc., and coordinator of Chattanooga's Gig Prize, gives the lowdown on the city's latest entry in the programming-for-dollars sweepstakes movement. We'll compare and contrast this contest with Kansas City's Gigabit Challenge that we talked about on the show two weeks ago.

 

Chattanooga's [up to] $350,000 Gig Prize contest (made possible in part by a grant from Alcatel-Lucent) is open to anyone in the world with great ideas. It's focused on creating apps using a gig network that's already operating and serving as the test bed. Particpants therefore get real world feedback in real time on their apps' effectiveness.

 

We also discuss how cities and counties can run similar contests that are focused mainly on the local communities. This is an effective way to boost local small business broadband adoption.  

Transcript

0:04 Craig Settles

Hello! This is Gigabit Nation Broadband Talk Radio. I'm your host, Craig Settles, and I want to welcome everyone in the audience today. Thank you for taking time to be with us as we tackle another important issue in the world of broadband. We're here to provide the useful information and insights to help communities, companies and nonprofit organizations get more and better broadband to everywhere it needs to be in America. And today's topic, I think, is one that many of you will find interesting and enlightening because this one deals with money. Specifically, hundreds of thousands of dollars in prize money that for those people coming to the broadband table with a creative application that can take advantage of gigabit networks such as those that are in place in Chattanooga, Sta. Monica, California, Wilson, North Carolina and soon Kansas City among other cities that are planning these networks. And today, my guest is John Wilson, who is the co-founder and former president of flexible display maker NanoLumens Inc., and he is also the coordinator of Chattanooga's Gig Prize Contest. And so let's just get on with the show. John, welcome, welcome to Gigabit Nation.

1:25 John Wilson

Great to be with you, Craig. I really enjoy that opportunity to share some of the things we're doing and hear what some of the questions you have from other parts of the country.

1:36 Craig Settles

So, let's start with a little background, the Gig Prize Contest, if I'm not mistaken has evolved in some fashion from what Jack Studer in his Lamp Post Group Project was all about that he described when I was down there in Chattanooga earlier this year. Is that right? It's kind of an offshoot of that?

2:00 John Wilson

Well, it's really -- we're quite fortunate. We've got a number of activities in the city that all kind of coalesce and came together in this and Lamp Post has been one of the key leaders. It all started with the fact that our electric power board put together the first complete service territory with 1 gigabit fiber, to the home or to the business and put it in place and got it all tested and working. And then it's available today. So as a result of that, institutions around the community businesses, university types and the like, they've all come together to try to figure out what is the best way to advance this as quickly as possible and take the ideas and the business plans that might be executed when there in fact is gigabit access throughout the nation, and get them tested and ready and ready to go. So that concept of a living laboratory thing has been kicking around for some time. Jack and the group at Lamp Post group which is a venture incubator in Chattanooga. They had the brilliant idea a number of months back. They said, "Let's put a price out for a student with the best idea in this space." We'll raise our hand and say, "We'll take on the students." So we -- you take that idea and you add to it the concept of doing the same kind of thing for entrepreneur teams which you -- if you look at accelerators and business incubators, you see that model, and a number of very thoughtful people in the community came up with the idea of the Gig Prize and seems kind of natural for the Gig City, so off we go.

3:55 Craig Settles

Now, Gig City is what -- seems to be a recent?

4:02 John Wilson

Gig City is the brand that Chattanooga is using to sort of symbol several programs that will flow over the next number of months. This includes a concept we called Gig Tank, which will take the concept that Lamp Post suggested for students matching with a similar track for entrepreneurs and we're going to run them through a complete summer incubator and accelerator program where we give a prize at the end. And so for the student idea that is deemed to be the best in this process, there will be a $50,000 cash prize. For the entrepreneurial team that comes together with the best business plan that is truly an investable idea, there will be a $100,000 in the Gig Prize. And that two together are matched with some additional cash. We've got other prizes. We'll put into the system for those that are in various topical categories or second, third place, if you will. And then on top of that, we've got a series of funds that have come together to put together the investment piece with any entrepreneurial track that you have to have at a seed incubator level. So we're putting another -- up to $150,000 in startup capital for the best entrepreneur teams that come together.

5:38 Craig Settles

So basically, what you're describing is several programs under an umbrella. There's a student program, there's an entrepreneur program and then there is a seed capital track, if you will, to move projects into that category and where there's different prizes. Is that correct summary?

6:02 John Wilson

That's -- you're very close. In fact, that's why we put it underneath this umbrella called Gig City because Chattanooga was the first and only city in the western hemisphere to get a whole service territory up and running at this level of internet speed and it's available today. It's not something we have to wait and have someone else come and install. It's there today to be used by a homeowner or by a business or an industry as they see fit. So, our whole purpose is to bring programs to that that will help define the next generation of internet applications and also it serves as a test bed. I mean, Chattanooga had a history that they call The Living Laboratory, which if you sort of look back in time, you can point to several examples where they raise their hands in some national group and said, "We're willing to try that out. We're willing to find some capital, find some partners, test that idea or concept out and see if it really does work in the market place." So, under this umbrella of Gig City, we're putting the other, this summer program we are calling Gig Tank, which is kind of like a cross between a think tank and an incubator and an accelerator, and that's the program will run the student team, the student competition through as well as the entrepreneur teams. We will run those activities through some existing incubator and accelerator programs there in Chattanooga. It will also provide all of those students and entrepreneurs, as well as some other researchers who will be coming in access to that Gig Fiber through four specially quick gig labs that we're gonna build up so that they not only have access to the speed of broadband at this capacity.

8:07 John Wilson

But they'll also have access to some specially drawn panels of customers who are using the gig already and provide a rich test bed for those applications. So, we're really looking forward to having that mix of research and business launched all together in the community at the same time.

8:28 Craig Settles

Now, how are you structuring the administration of this? It sounds like with these different types of projects you have, things having in parallel, is it gonna be one person or is there a committee that's going to keep all the plates and all the balls in motion here?

8:50 John Wilson

Well, that's what's so magical about both the internet and about Chattanooga. I mean, I don't know. You and I met when you came to town to tour the EPB facilities and participate in one of those intentional dialogues they were having with community representatives about the whole one gig rollout. They have a wealth of organizations already engaged and involved in the programs that will be unveiling and rolling out for this purpose. But in addition to that, if you think about the internet, most of these contests and applications will occur on the internet, on a website under the gigcity.com and we'll have most of that up I think over the next couple of weeks. We've already got a side up that's taking names and email addresses for those people that are interested and we plan to use the sort of the power of digital media to accelerate the application process as well as to build interest in not only the competition itself but the work of these great pioneers are gonna be doing.

10:15 Craig Settles

Right. And then you have some process of I'm guessing keeping a chronicle of all of the activities and the best practices that will come out of all these activities and so forth.

10:30 John Wilson

Well indeed. I mean the beauty of -- I don't know if you've been following the sort of the evolution of incubators to accelerators, but if you go on the web and you look at what TechStars and Y Combinator and all of the wonderful accelerators that have launched over the last few years have done, virtually, all of their pitch nights are now recorded on YouTube. You can see some incredible companies that got launched, whether extreme adventures or come down to Tennessee and look at the entrepreneur center in Nashville. This process has a lot of richness and people are borrowing ideas. We have had some just incredible support from people around the country with just great ideas on how to do it and how to make it easier and more fun for all the participants, including the VCs and the money types who have come and do the pitch nights and do the judging and sifting of the various ideas and business plans that they come across.

11:35 Craig Settles

Now, is 48Hour Launch considered as an accelerator or as the accelerator program something different than that?

11:43 John Wilson

Well, 48Hour Launch is a program of the incubator known as Company Lab, which has been in Chattanooga for several years now and is just doing an incredible job, taking startups and moving them down the road towards success. The accelerator concept is sort of an incubator on steroids, so they have launched out of Company Lab something called CO.STARTERS, which we're very excited about in Chattanooga. We've got several other organizations including Lamp Post Group which is in itself a venture incubator that's very successful. It has got a range of companies that is small as your traditional internet startup to tracking business in nine figures revenue. So the richness of the community gives us a number of programs to work with in this context and virtually everybody that is in the entrepreneurial culture and the community has a role in the Gig City and in the Gig Prize programs, whether they are actually running a track or whether they are judging or mentoring, or raising funds for, or doing outreach to try to find other good ideas to bring in the program.

13:07 Craig Settles

And for the benefit of the audience, I should explain a little bit about the 48Hour Launch, which is basically bringing together anywhere from 10 to 20 people with ideas and the basis of a company, and inviting an audience of several hundred developers and programmers, financial people, business people, marketing people, a whole sort of the -- the whole quadrant of things that you need to have, an entrepreneurial venture and have that audience listen to the initial presentations, then decide which teams that they want to join. So basically, it's a first cut, and then they go through the rest of the weekend building a business. And then at the end of it all, they present what they have created in that 48Hour pressure cooker and then there is a final judging and prizes and so forth from there. I think I've summarized that without killing it.

14:05 John Wilson

You did it quite well. And what is so exciting about that process, I mean 48Hour Launch is run by Company Lab, so the same people who run that program on a regular basis in the Chattanooga environment are also already working on planning the parallel structure inside both the student and the entrepreneur tracks. Even down at the facility that we will be using for the pitch nights down to who is mentoring which team or which type of team, how we'll physically move them through the process, and where that down select fits within the 65- to 80-day kind of program that you consider typical for one of these accelerators. So you did say it very, very well, and the great news about what we're working on is we have some season veterans and some great institutions who really have done this many, many times before, but we're going to focus all of this attention on this one set of topics and one set of opportunities associated with Gigabit Ethernet and that's just for me a very exciting opportunity I think, to tell people about and to attract them to apply for.

15:34 Craig Settles

Very, very interesting. I mean, it looks like there is a lot of -- we're going to use my Physics, this is what we call kinetic energy. There are a lot of things happening, and how structured it is versus being flexible enough to let people be creative, but at the same time, you still want to funnel people to an endpoint, I would assume.

15:59 John Wilson

Well, I think the thing that's interesting about 1 gig bandwidth is that the flexibility is sort of on the open end. We don't yet know what will be the most exciting ideas or business plans that will address the capacity of that technological advance. So, we're sort of sitting -- we have some ideas, we defined some broad categories like advanced manufacturing and cloud computing in healthcare and digital media education and public safety and emergency response, but we don't know which of those would draw the best and brightest ideas or the most exciting business plans. We just want to know. But on the other end of the extreme, the successful formula, this price and accelerator, and incubator mix is you wanna help. In the case of a student, you wanna help them refine the idea and be in a position to present it to a larger audience of others with good ideas and really capture the imagination of the group. If you've ever seen a TED talk or participated in a TEDx event, it's very similar to that nugget, an idea that is presented to an audience of people who want to comment, listen, and think about it very intently.

17:36 John Wilson

On the entrepreneurial team side, you want to add the crucible of turning this idea into an investable business plan and you need to do that in a timeframe that's possible. And you want to do that using mentors and entrepreneurs who are seasoned, who have done this several times before, they've got scars on their back, they have got the money in their pockets with good exit and you want to help these young teams really come to this opportunity and that's how you sort of funnel you're working with. So, we've got both ends of that spectrum to work with and I think that's what's going to make this a truly exciting exercise.

18:25 Craig Settles

So now, what kind of interest have you received already? I know that on the sponsorship side, Alcatel-Lucent was announced last week. I believe it was as one of the sponsors and they're putting in 100K. So, you have a recruitment effort, I'm assuming again, that's going after sponsors, which is making the money available and then you have the recruitment effort to get the people to participate in these various programs. How are those things coming together?

18:56 John Wilson

Well, we're blessed on a number of friends we've got. Chattanooga is just a wonderful entrepreneurial environment. It's a very rich ecosystem and in the community itself, there had been a number of wonderful first that they have created companies and individuals who have the kind of leadership skills that you need to put into this. The very first Coca-Cola bottling plant was built in Chattanooga and became a very successful business. When the company was sold and exited a number of years back to Coca-Cola enterprises, that will help create not only a company but also a foundation that are actively involved in this program and people from both institutions have been daily involved in meetings on the Gig Prize, the Gig Challenge, and that's part of their culture and part of their strength as a community. So, we're pulling together, I guess, finishing up is the better way of putting it, the funding for the program, but we've already got enough in hand to feel very comfortable, sharing with the world and largely because of the Alcatel commitment and that of some other companies and foundations around the community that we've got up to $250,000 available in cash prizes and $150,000 in startup capital for the programs that we're gonna select to go through the Gig Tank exercise and it's part of this whole Gig Prize effort. So, we're very excited that these numbers could grow if we complete our canvass, but we're in the execution mode now and I think you'll be pleased that you see the elements of this thing unveil over the next couple of weeks.

21:02 Craig Settles

Okay. So let's shift a little bit and talk about the how to, right, because I'm sure a lot of people who are going to listen to this they're going to want to know, "How can I participate in the student program?" or "How do I participate in the entrepreneurs program?" Can you take each one of the main categories and just give us an overview of what people need to do to be able to participate?

21:25 John Wilson

Sure. Well, first of all, we'll announce the rules and the application process in about two weeks. We're working very intently on that now, putting the finishing touches on it and I think people would be very excited when they see it. We have had a lot of help. We've got some great ideas from folks out at the Annenberg Innovation Labs out at USC, from the entrepreneur center up in Nashville and others about what are the best and brightest ways to run a contest or a program like this and attract the right people and give them the most benefit from their time spent inside the program. So, we're setting up, we're taking the physical assets, we've got the Gig Labs, they were putting together four different labs around different locations in the city that will run 24/7 for both the researchers and students and the entrepreneurs who will be in town at the same time. We've got some incredible assets to add to that. We've got the National Center for Computational Engineering there in Chattanooga, which is a major simulation center in the University of Tennessee at Chattanooga, but all of this is being wrapped into a very easy to apply to and very easy to learn about program. You just go to the website, one website for both students and the entrepreneurs. You're not sure whether you have an investable business and you're a student, but you've got this idea you think might be. You'll go to the website and sort it out in that process and we still want to hear about it and have you sort of enter the process and let's see what we can do with it. You ask who we've heard from it, what kind of excitement.

23:21 John Wilson

I already personally talked to a number of people who are planning applications and they don't even know the rules yet and they're either successful entrepreneurs who have done major tech companies and they are in some other part of the country, but they've heard about this and I think it's just a wonderful exciting catalyst to what they're doing, so they're gonna jump on it. We know university teams and states outside of Tennessee they've already started organizing programs. We looked at the university program at Georgia Tech. They run for four to five years now, a convergence technology contest that had some brilliant ideas about both how to get student teams motivated, how to get them engaged around the program and then how to bring their idea to fruition as a complete prototype. So, we think people are gonna find this very easy to both get involved with, to learn about one point access whether you're a student or an entrepreneur and then for those that may not have a program but just want to know more about what we're doing, to share ideas or learn about the website, we will also give them contacts for how they can engage with the community and find the right the person to talk to, I mean that's what it's all about.

24:55 Craig Settles

So I'm guessing given the excitement level in Chattanooga, which is very similar to the excitement level in Kansas City that you will find probably lots of people or organizations willing to be part of the test bed. In other words, there's X number of people who will be coming in developing the applications, but eventually you have to find users for any kind of pilot projects and so forth. Are there people showing interest in being the guinea pigs if you will, saying, "I'll step up and I'll test," someone's new app or someone's new piece of hardware, running an app or whatever.

25:32 John Wilson

Well, that's one of the nice things about the community that we're doing this in because they've already had the fiber bandwidth in place. They've had real live users using the service day in and day out and have already had a number of internal test groups fired up, excited about being those guinea pigs if you will and so there's institutionally within EPB. There are mechanisms to set up, specific test panels so that the researcher or the business group, that is, the entrepreneur group that is testing out a new prototype can get exactly the right match. I mean, there's nothing worse when you're trying to run a poll, to not be able to get the right test panel together and then have it be statistically valuable to you as you prepare to launch your business, and whether you're doing is just pure research, or whether you're doing it as a business context, you want that kind of validation. And so we've got the goods in place, both the hardware and the software and the support from people and institutions to provide all of that to those researchers. So, we're really looking forward to having these ideas there. And then beyond that, we're taking a lot of extra steps to sort of plug in to the things around the country and around the globe that are emerging in the space. For example, there is somebody physically today in Kansas City for the NSF GENI meetings that are scheduled. I guess today, tomorrow and Friday, and one of his purpose is he's part of the team working in this whole Gig Prize, Gig City effort.

27:32 John Wilson

His organization has a range of missions, but one of the missions that he is taking on in that trip to Kansas City is to carry two of those researchers, the latest news about what we were doing and extend to all of them an invitation to participate with us, help build with s, these new applications and these new systems for the internet of the future.

27:59 Craig Settles

Well, that sounds like you're going to be definitely tying in a lot of good energy, synergy and whatever other buzzwords we can think of. Is it reasonable to expect that these can even become globally connected networks of folks providing input, providing ideas, providing testers and so forth?

28:20 John Wilson

Well, that's the beauty of the internet. There is no reason why you can't work with people all around the globe on a range of things 24/7. So, the answer is yes, yes, yes. For example, just in the background research to understand how you take this crucible of an incubator-accelerator concept and apply it to an area like 1 gig fiber, we reached out to a venture capitalist in Italy and one here in the States who had done a piece of research on quantifying the various programs of the 200 or so accelerators that they had launched over the last few years and spoke with them, talk with them about what they found, what they thought, what they saw and what their thoughts are for, their next year's research and that's the beauty of the internet, you jump on, find a piece of research, contact the person and have a conversation, might be a late hour at night or early morning, but you close the loops.

29:46 Craig Settles

Wow. This is all pretty amazing stuff. And it points to a comment that was made last week when we had a brainstorming session. We've brought four people in who have been involved with a day-long brainstorming session in Kansas City with about 60 or 70 of their stakeholders. And one of the things that came up on the show was this idea that as these test beds developed, as this contest develop, we may likely find that the conventional construct we call a company with its hierarchy and its offices and so forth and so on will just get totally tossed out the window and there will be some new virtual limited time kinds of pairings of resources and people that basically it'll transform the business as we know it today into something very different because all of a sudden the gigabit network takes away both the hierarchy and the physical constraints of space and time because you can do things at any given time, a day or a night. What are your thoughts on that vision if you will?

31:05 John Wilson

Well, I think elements of that had been in place for some time. In my background, I ran a DARC-like consortium and then after that, in the same vehicle space, we developed a startup company that was partnered up with Smart and Mercedes and within about six weeks of starting the business, we had crash test simulations designed by a designer in California. We had vehicles on a boat coming, actually they were flown over from Germany, and we were up in a crash test facility in New York that is used by the auto industry and the insurance industry to crash test vehicles for commercial use. We had to get parts and suppliers for that particular Smart car to provide a very complex engineering information electronically over the web and pull that all together and design the test and design the additional things we would need to meet the unique test here in the United States versus the test that exists in Europe, and those designs and the test we did just in a matter of weeks were integral to Smart's entry into North America over the last couple of years and that's been around for a few years. What's going to happen in this next iteration of speed if you will is the instantaneous nature that the delay we've become accustomed to living with, the pause, the spinning wheel on your screen, whatever it is, it really is different when that speed barrier is no longer there.

33:14 John Wilson

I talked to somebody the other day who's a physician and they were explaining the complexity of trying to read a really complex set of electronic images from an MRI or CAT scan that need to be sent to someone who's a specialist. You've got all the power of the machine in the room with the patient but if you need to get the brain to do the right reading and to look at it in real time, you've gotta get that person to one of only your handful of facilities to access that data and be in a position to give you an immediate response. Well, that's what speed will do for you. You won't have those kinds of limitations as much and we will benefit that from just in thousands of unimagined ways.

34:15 Craig Settles

I can see what that would -- that would definitely be the case. Very interesting. Let me bring up another train of thought if you will. We have -- we being the industry and others that's involved in broadband and so forth often talk about broadband in rural terms, in terms of what it'll do for smaller rural communities, and not to take anything away from that discussion, what about urban areas? What kinds of activities, what kinds of participation can we expect from the big cities and maybe areas where they don't have broadband, they have all kinds of economic issues, just as significant as any of the issues that you deal with that in some of the poor rural areas? What do you see coming out of the urban world?

35:12 John Wilson

Well, it's a good question. Years ago, I did a lot of work with Southern Governors' Association, the Southern Growth Policy Board, and we were always worried about sort of the two souths that were developing and what we call the "South that was in the shade," the part that was missing out on all of the big dollar advantages and the transportation and economic development successes that you saw on the big cities with airports and railroad lines and the like. The interesting thing that the internet brought along is a leveling out of that, and I don't care whether it's global, and you think about sourcing some design to researchers or software coders for you in India or in Chile or in Quebec or wherever. You can truly bet out your job and get a good qualified team set to go on just about anything overnight. What's intriguing though at the ground level is if you think of city area between Atlanta, Georgia where I live and Chattanooga where the Gig City and the Gig Prize are being unveiled, it's about an hour and 45-minute drive between the two and there is an extraordinarily rural area between here and there, but there are a number of major companies and major businesses, there are technology starts that have occurred. I was in a local event in a small town called Rome, Georgia that's in a very kind of a rural corner of Northwest Georgia and the internet itself has provided the opportunity of all of these communities to taste and to enjoy both knowledge, education and in going to your library and in getting anywhere in the world.

37:18 John Wilson

So it's moving a lot faster than I think any of us would have dreamed when __37:27__ turned it on and I think the same thing is gonna be true as higher speeds become prevalent, and there's also the whole evolution of wireless. I was traveling between -- I left here early one morning when the royal wedding was occurring and I was listening on a podcast on CNN on my iPhone and discovered to my surprise is I'm driving up the freeway between here and there that it was streaming over 3G and you could see the carriages that pulled at the Buckingham Palace. That wouldn't have been possible five years ago, so much less 10 or 15 years ago. I think the same kinds of surprises are going to occur and you'll be able to do an incredible amount in smaller and mid-sized communities, and Chattanooga's kind of an interesting example of one that's right there in the middle. It's not so large that you have a hard time getting around it but it's also large enough that you got many of these things in terms of quality of life that people are looking for. I don't care whether you're in Silicon Valley area where you sort of are you in Palo Alto? Are you in San Jose? Are you in San Francisco? It's sort of like it's all emerging.

39:11 Craig Settles

So, would you say that given that Chattanooga in size and demographics, somewhere between small town America and urban metropolis America that you'll be able to test, I don't know, applications in environments that could be adapted to both in the long run?

39:34 John Wilson

Well, that's kind of the beauty of this as a test bed. Chattanooga is literally only minutes to the mountains. You can be climbing a ridge or doing a range of exciting outside activities, kayaking, whitewater rafting, you name it, in just a few minutes, but this kind of speed allows you access to the rest of the world instantly. So you can now have the best of both worlds, and I think that's really something that's evolved quite surprisingly. I have a colleague that lives in a very rural part of South Georgia and he calls it the "technology center of the universe" when he answers the phone, and he's a former investment banker from a very large firm, he's retired down there and he does deals. That is the beauty of this tool that we're all learning to use.

40:46 Craig Settles

Okay. So it does give a -- it is another one of those advantages of Chattanooga B in Chattanooga, that it can go and that has creates solutions for various types of market. I think there's a word before it.

41:04 John Wilson

I think we're gonna show -- how do I say this -- I think the students and entrepreneurs who've come to Chattanooga for this program are gonna have the time of their life. First of all, it's an incredibly vibrant city for the arts and for food and entertainment. The whole gig tank exercise will occur during the summer when they run just a wonderful river festival with music and food and entertainment every night. They're going to have an extraordinarily fun, vibrant time while they build some incredible new businesses or shape ideas that people will be talking about for years. So for a college student or a grad student who applies into the program, I can't think of a better way to spend your summer, and if you're getting ready to launch a new business in this space, I can't think of a better way to get a leg up, get the idea polished, get the plan done, get the prototypes done and get your first chunk of funding from some people who know how to find you a lot more funding should your idea be worthy and your plan is successful. So, I think that's the other nice thing about this kind of laboratory setting. It's really is a living laboratory, is quite enjoyable.

42:44 Craig Settles

Now I wanna a shift to in this last segment of the show, to an interesting project that I covered doing some work for the Kauffman Foundation on the ability of broadband networks to generate entrepreneurs, and the community in Vermont encompasses about three of the poorest counties in Vermont, and one of the things they did for billing and increasing small business adoption of the internet was they actually did a contest in some respect similar to what you guys are doing in Chattanooga and Kansas City. And I just want to kind of highlight a couple of aspects of their programs because the interesting thing about doing the story is realizing that these kinds of things can be done on a smaller scale. You guys are going for defense. Kansas City and Chattanooga both have six-figure prize money. It's a big deal, but there is also a way that local communities can get involve. So the nature of the deal is they have a contest or conducted a contest in which people submitted a preliminary plan that says, "Okay. This is what we'll see dealing with our business that's different and then how we are gonna expand our business using the internet," and it wasn't judged but it was a basic get them to write down a general idea of a vision of where they think they can go with the internet, and then from that, then they have like 30 days or 45 days to create an actual 5-page plan on how they're gonna use the internet. So, what are your thoughts on having a requirement for people to first come up with a vision and then come up with a refined plan as if that overall sort of strategy from the entrepreneur side?

44:48 John Wilson

Well, I actually think that's sort of the core of the successful model for these accelerators. By the way, you mentioned the Kauffman Foundation. I'm 99% sure that the Kauffman Foundation was one of the two funding entities for the study of the various accelerators that I mentioned earlier and it was a venture capital of VC down in Austin, Texas at DFJ Mercury. Aziz Gilani is one of the co-authors of that study and I'm 90% sure it was actually Kauffman Fellows who did part of it and Kauffman Foundation funded part of it, but anyway. The whole concept is to take an idea into this crucible, a business idea okay, a concept for a new business or a new business start, taken into the crucible, subjected to rather than you work in a quiet garage or your basement for six months or a year and just keep working on it, working on it, working on it by yourself subject you to a different environment where you work on it but you work on it in front of your peers who are doing the same thing on four, five completely different ideas. And every couple of days, in a regular fashion, you stand up and present that idea with slides and your numbers, and your projections, and your -- you take the arrows from your colleagues and you get toughened up and you get better at dealing with the obvious questions that everybody is going to ask, particularly the market is gonna asking you.

46:47 John Wilson

And what's intriguing about the process is that generally, it's not the first idea that comes out. Generally, you'll pivot one, two, three times, so by the time you launch 60 to 100 days later, it may not even be the same business area that you're in, but you have now had an idea that has been shaped, formed and really beaten up and chewed on, and really advantaged by this program. And what's so -- you have to sit in and watch a group of entrepreneurs go for this kind of pitching process, go through the self-critiquing kind of exercise. What's funny is, in the technology world, I don't think many of them would be aware of this but this is actually something that if you go to fashion school or art design college and some of the better schools like RISD or Savannah College of Art and Design or the like, MICA up in Maryland, in Baltimore, you do this kind of critique regularly with your colleagues and we used to call them rip n' tear sessions and they're very effective. You present this piece of art that you worked on for weeks and it's either sculpture or painting or whatever, or a beautiful fabric or a dress that you've designed and your friends rip you to shreds. And this just last for an hour or so and then you go back and you rebuild that thing, and then you bring it back in a couple of weeks and they do it again. And at the end of the process, you're ready to face the kind of audiences that watch Project Runway and do the runways in Milan and Paris, and New York, and as a result you're ready for business. And that's the same game in this technology accelerator world.

48:54 John Wilson

It's a very powerful tool, either privileged of dropping in on TechStars New York a couple of months ago and they were in the middle of running a co-work. I listened to the head of TechStars New York and head of TechStars Boulder, David Tisch and David Cohen, exhort the family of young entrepreneurs and what they needed to do to be ready to pitch, how they were going to present this issue or that issue that tends to be common in a startup world and then off they start. And if you look at the companies that launch out of this process, the young entrepreneurs, and you watch the videos of their presentation, you see the kind of strength and polish and excitement that can only come from that kind of criticism.

49:50 Craig Settles

Definitely a program not for the faint of heart or tender of ego. No way. No way.

49:58 John Wilson

But you've got to believe.

49:59 Craig Settles

That's right. That's right.

50:00 John Wilson

That's the whole purpose. You know, you got to believe.

50:02 Craig Settles

What doesn't kill your idea makes us stronger, sounds like the philosophy. So now, another thing that the group in Vermont did was they also set up an online resource for mentors. So, what they would do is they would have online areas, chat rooms categorized by different topics, finance, marketing, so forth and so on, and they will get local people to be the participants and then they would answer questions from those participating in the contest. Now, I gather that you guys have some element of that in place, but just as, you know, to the small county to tell you, you might think about doing something similar, how important is it to have that mentoring component that's available via online in some way?

50:57 John Wilson

Well, I think you put your finger on a very interesting problem. No community is going to have just down the street a seasoned entrepreneur in every topic that could come up or every business idea that could come up in that community's startup accelerator. And in fact, one of the most challenging parts of growing one of these programs that I have been told about by many is finding and training mentors and then engaging them in the program and then the booking and the scheduling of that. In fact, the guy that runs Company Lab is titled as air traffic controller, and it's for a very good reason. There's just zillions of meetings of perspective entrepreneurs to be made it up with mentors and potential business funder types who are both looking to find the right fit and the right match. The funders looking for -- I'm looking for the next opportunity that is going to fit my profile for funding and in the window in which I am doing it in and I'm looking also for both the great right business idea and the right team that looks capable at executing that idea. So, it's a very constant churning kind of process that needs to be looked after carefully intended, much like grow in the garden. And they do a great job of it up there. And I think the real challenge in a real small community, and I grew up in a town of 16,000 people so I know small town in America real well.

52:56 John Wilson

The real challenge is you're not gonna have as many of those available to you and so the internet offers an incredible opportunity to do that. This is not a very different problem solution set than what established angel groups do. There are a number of regional established Angel Capital Groups and they typically -- after they make their investment or as they're making it, they team up members of the group with the invested company as mentors and work through the process, and oftentimes, if it's a rural Angel Capital Group or a larger region if you will, they won't be in the same city. So, they all do this by internet, by email, by established meetings and briefings and that kind of thing. One of the values of the internet is to let you reach you out for those resources wherever they are.

53:59 Craig Settles

Now, another aspect of this program in Vermont is they have a timeline, like requirement, when you have to use your prize money and the services, the contracts that you win through this contest, which is a way to make sure that people get on board quickly so that it does indeed have an economic impact some time within a reasonable timeframe. Do you think that's reasonable to have that kind of requirement in the program?

54:34 John Wilson

Well, I think if your program is directed towards local economic development and you're putting your capital on the table, you have every right to ask for whatever it is you want. The entrepreneur has also the right to say "no" or to say "yes" and that's part of the process of the give and take in an entrepreneurial capital society. I think it makes a lot of sense in my mind for the rules to be as transparent as possible up front so that the teams all know what they're getting into on both sides because you don't want mentors getting all excited about working with a company and then have the company fall out of bed at the last minute because "Oh, I didn't understand this term or condition." By the same token, you want the money that's being put up to be used efficiently and so you certainly don't want somebody sitting on it or just using it to go take Sabbatical and __55:43__. You know, that's not what the contest is about. If you want that, go apply to that foundation or to that resource. So, I think there are ways to make these things work, but part of it is also to give them a taste. In Chattanooga, what we're doing is we're giving them a taste of a real live gigabit Ethernet system with tens of thousands of users that we can categorize and sort through and lay up in samples for you to test your application against. You can't do that anywhere else in the western hemisphere. So we think that's an advantage to them because we give them a taste of that before it's gonna come up in other communities around the country. But you still have to work hard with them to help them get to an investable idea and something they can launch as a business. This is a collaborative effort.

56:48 Craig Settles

And I think that this balancing between responsible use of the money and maximizing the creativity is probably an ongoing exercise that has to be addressed. My take away from the Vermont story was that for small communities, you can look at the kinds of programs that Kansas City is doing, that you and Chattanooga are doing there, and create a smaller but still practical and valuable version of that at the local level, whether it's a one-county or three-county area, but it's possible. I still look at it as a see thing in which doing is you're working with smaller numbers, smaller prizes, but ultimately, the idea is you have an incentive through a program, through a contest to get people engaged and then you provide the right kinds of supports around that contest so the people learn something. And I think you'll find is that not only will the participants take advantage of the internet but there will be a lot of people who won't participate in the contest, yet they will still be able to take advantage of the internet just based on what to learn by being an outsider looking in or participating in some of the educational seminars and so forth. We're just about out of time and this has been a really good conversation. Just real quick, we got like a minute. Do you see this is kind of like a broadband __58:29__ where we may use these contests as a way to generate money for investments in the broadband at the application level? One minute. One minute.

58:40 John Wilson

Well, I think the answer is yes. I think these contests give you a way of sort of sharpening the pencil, sharpening your focus, and you'll never know what will come out of it. I think the other thing you can do is just ensure ideas back and forth. We talked to Diane Berg, we talked to others, NSF GENI, and we're continuing to talk to people because ideas are not -- they're not a sole indention of me or I. They are out there in the world and you have to go and get them.

59:12 Craig Settles

Right. Okay. Well John, again, thank you very, very much for being on the show today and I thank our audience. I appreciate all you listening in and then I also want to thank our media partners, GigaOM, Broadband Communities Magazine, miniwireless.com, and Community Broadband Networks. Everybody have a great day and we'll see you on the next show. Take care, John.

59:35 John Wilson

Thanks, Craig. Bye-bye.

59:36 Craig Settles

Goodbye.

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