Over the last few years, much has been written about the demise of the United States as an innovation engine. In the field of nanotechnology, the United States started the drive with the passing of the National Nanotechnology Initiative in 2001. Over the last decade, many countries have followed the United States's lead and have developed similar, albeit massively smaller, programs of their own.
In addition, post-9/11 immigration policy has restricted the ability of foreign students studying in scientific fields to stay in the United States after their degree has been completed. So, the question of whether the United States is still the economic engine of the world is a valid one.
As popular as it would be to jump on the bandwagon and say that the world is moving to Asia, I don’t think this is the logical conclusion. If you presume much of the growth in Asia is driven by China, then you must look at the true ecosystem that is, or is not, being established in the country.
There is no doubt that China is investing a massive amount of capital in the physical sciences. The question of how much of that money is truly going to developing novel technology is a separate issue. The vast majority of technology parks still evaluate success using square meters as a key performance indicator versus using intellectual property-developed,licenses completed or companies created.
My belief is the ability of any other country to develop the scope and breadth of the ecosystem that has been created in the United States is a non-trivial matter. In venture capital, technology is important and market is very important, but most important is the management team. The United States has created multiple generations of entrepreneurs who have built several companies; some successes, some failures.
What make the United States the most powerful innovation engine in the world are its world class universities, its well structured intellectual property and capital system, and its massively robust pool of talented executives who have the ability to create strong companies.
This does not mean the rest of the world is insignificant in the technology race. As investors, we think it is critical that technologies be sourced from around the globe. Additionally, we believe that our portfolio companies must look at the global markets. However, we also believe that the United States remains the strongest place for many of these companies to be formed and nurtured.
At Harris & Harris Group, we are committed to sourcing technologies and selling products both on a global scale while maintaining a foundation of experienced executives in the United States.