A Better World in the Making: Investing in Innovation

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S U M M ER 2020

A Better World i n the Making

Investing in Innovation

Invested in Innovation The 2015 report, Entrepreneurship and Innovation at MIT: Continuing Global Growth and Impact, concludes that, “Well into the second decade of the 21st century, the growth and impact of MIT alumni entrepreneurship continues unabated.” In the first half of the following decade, as a global crisis threatens to undermine the health and economic survival of people, nations, and businesses alike, this declaration still rings true. Today, MIT Sloan remains fully invested in developing the next generation of principled, innovative leaders—those entrepreneurs who are always endeavoring to make a better world with big ideas and bigger actions. Nowhere is this dedication more evident than in the school’s ongoing efforts to cultivate a more disciplined form of entrepreneurship—so that the innovations created by its world-class faculty, students, and alumni can achieve an even greater impact. This community of brilliant, practical thinkers is continually creating novel inventions and enterprises; employing them to develop a smarter, fairer digital economy; and harnessing the models, data, and technologies that result as a significant force for good. And the ultimate expression of these labors? The advancement and expansion of new business opportunities for the many instead of the few. Consider the promising and hopeful examples in this newsletter. From the Martin Trust Center for MIT Entrepreneurship and InnovationHQ—the future hub of student innovation and entrepreneurship here in Cambridge—to projects initiated by Action Learning labs and their alumni across the globe,

Solving the biggest problems of today and tomorrow requires the most creative kinds of innovation, bolstered by the most imaginative forms of entrepreneurship. As the 2015 report notes, MIT is up to the challenge since its “history provides numerous examples of how one major academic institution achieved significant entrepreneurial impact.” So, too, will its future.


what the MIT Campaign for a Better World originally set out to accomplish.


these stories illustrate the core mission of MIT Sloan. They also demonstrate


Prototyping the Future While MIT’s motto, “mens et manus” (“mind and hand”), has always guided our collective endeavors, the events of 2020 have both clarified our purpose and renewed our focus. Creating the inventions and enterprises needed to improve our world requires hands-on action, and it’s the business of MIT Sloan to foster an ecosystem that makes this possible. Thanks to programs like the MIT delta v accelerator at the Martin Trust Center for MIT Entrepreneurship and a wide range of faculty and student initiatives, we’re prototyping a better future.

Optimized for Long-Lasting Performance: Reengineering Business Wear Anyone who’s seen a James Bond film will appreciate the origins of Ministry of Supply, a “performance professional” clothing brand that’s transforming the industry. In the fictional Bond universe, the character “Q”—a techno-wizard who supplied Bond with cool gadgets to solve any problem—operated under the name “Ministry of Supply.” For Kit Hickey, MBA ’18 (Entrepreneur-in-Residence and Lecturer, Martin Trust Center for MIT Entrepreneurship), the problem was clothes for the office that lacked the breathability and flexibility of outdoor wear. Soon after coming to MIT, a visit to the Martin Trust Center for MIT Entrepreneurship led to meeting Bill Aulet, SF ’94 (Managing Director, Martin Trust Center for MIT Entrepreneurship; Professor of the Practice,



Technological Innovation, Entrepreneurship, and


Strategic Management), who connected her with like-minded collaborators like Aman Advani and Gihan Amarasiriwardena, SB ’11. Soon after, Ministry of Supply was launched. Eight years on, Ministry of Supply represents a rapidly growing innovator of science-based clothing. The firm has a thriving online business, combined with six brick-and-mortar stores. Their latest invention? A carbon-neutral dress shirt to bring fashion together with fighting climate change. GIHAN AMARASIRIWARDENA AND AMAN ADVANI

Made for Innovation: Inside ProtoWorks


With continued support, ProtoWorks will play a leading role in helping to usher in a new era of local invention and manufacturing—all while providing a literal embodiment of MIT’s “mens et manus” approach to innovation. As many companies rethink their global supply chain strategies, there will be growing demand for products designed and made in America. Our continued commitment to makerspaces positions our students at a practical advantage in achieving “entrepreneurial speed,” while decisively supporting the principle of “learning by doing”: a cornerstone of MIT’s educational philosophy. As the sounds of hands-on prototyping return to ProtoWorks louder than ever, such makerspaces will continue to embody the school’s mission to teach innovation and solve the world’s toughest challenges.



Students from across the MIT community roll up their sleeves together here, creating a bridge between disciplines that informs productive entrepreneurship— and providing a vivid demonstration of why and how such makerspaces contribute to the unique atmosphere at MIT. In a typical Introduction to Making class, for example, about 75 percent of students are enrolled at MIT Sloan, and 25 percent are in engineering.


The advent of COVID-19 brought something highly unusual to the ProtoWorks space: silence. With the space temporarily closed, however, came new opportunities to make remarkable things in new and better ways. ProtoWorks’ Introduction to Making course was digitized practically overnight, providing resources for students to learn the important digital skills that are needed to continue making progress on their projects. Fortunately, digitization allows for the rapid outsourcing of prototype development. After all, the need for such rapid product development has never been more critical. “I’m focusing students on how to create a digital file with the most cutting-edge software,” says Cameron. “We can upload the files online and get competitive quotes from services across the country, then choose the best service to send the physical prototype back to us.”


To walk into the ProtoWorks space at the Martin Trust Center for MIT Entrepreneurship is to be immersed in the whir of a drill press, the hum of soldering irons, and the buzz of 3D printers and laser cutters. Known as a “makerspace,” ProtoWorks—supported by Ronald A. Kurtz, SB ’54, SB ’59, SM ’60—is where innovation and entrepreneurship meet hands-on experimentation. (MIT has a constellation of over 35 makerspaces on campus, adding up to over 130,000 square feet.) In an environment like this, students can bring their ideas to life in a tactile way and accelerate their learning through experimentation. With classes like Design for 3D Printing and Introduction to Making, students have access to a whole suite of cutting-edge technologies for physical prototyping: from 3D printers and electronic components to advanced software tools. More importantly, students receive expert guidance from faculty, helping them to get the most out of available tools. Mac Cameron, a lecturer who teaches several courses at ProtoWorks, gets as much inspiration from his students as they do from taking his classes. “It’s a pretty cool time for making,” says Cameron. “We have a constant flow of remarkable people coming through with a huge amount of passion. It’s really exciting because I expect that the next generation’s best minds may be sitting in my classrooms.”



Spotlight on the Batchelor/Feld Entrepreneurship Fellowship Program Some of our best work comes when we reach across disciplines, learning from and alongside those whose skill sets and perspectives differ from our own. This year’s delta v cohort benefited from exactly that kind of important collaboration, thanks to the Batchelor/Feld Entrepreneurship



Fellowship Program. Newly established by Wellesley College alumna Amy Batchelor and Brad


Feld, SB ’87, SM ’88, the fellowship program opened the opportunity to apply to the 2020 MIT delta v summer accelerator program to student entrepreneurs from Wellesley. Joining their peers from MIT in changing the world through entrepreneurship, Wellesley students who were awarded the fellowship spent the summer fully immersed in delta v, in either Cambridge or New York City. They were also able to take advantage of monthly video mentorship meetings with Amy and Brad, drawing on their wealth of knowledge as leaders in community and non-profit activities, entrepreneurship, and venture capital.

Accelerating Impact: MIT delta v Just a year ago, would anyone have thought an MIT startup could map a pandemic by sifting through sewage? Our world has changed, and so has the world of entrepreneurship. Through the ongoing generosity of donors, the Martin Trust Center for MIT Entrepreneurship’s delta v program has built an unmatched reputation for encouraging the skills of resilient entrepreneurship—and discovering opportunities in the midst of chaos. Here, we look at the past, present, and future of an initiative that embodies this spirit.

The summer of 2020 marked the 11th year that the Martin Trust Center hosted an accelerator program, and the 9th year of delta v—which was adapted to a virtual model to incorporate social distancing and other safety measures. This summer-long, full-immersion educational experience is designed to support MIT student entrepreneurs as they hone their entrepreneurial skills to build out breakthrough business ideas, validate their target market, and start creating a viable and sustainable venture. SUSTAINED SUCCESS

While the goal is to build the next generation of the best innovation-driven entrepreneurs rather than focus on their startups, the companies they build can be a proxy for how successful the program has been. In this regard, the approach works, as evidenced by the extraordinary success of startups launched out of the delta v accelerator over the past decade:






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In 2019, Embr raised $6 million in Series B financing to


grow their presence in digital therapeutics, accelerate

The success of delta v can be measured in both financial

the next generation of its core technology platform,

return and impact on society. Whether tackling a major

and validate new use cases in thermal wellness. The

problem or a perennial inconvenience, companies launched

company also won AARP’s Innovator in Aging Award,

with the help of delta v are solving some of today’s most

and was featured live on ABC’s Good Morning America.


How do you transform the concept of a closet into a


new way of dressing that empowers women? While a

Sewage may be the last place that most people would

large wardrobe can be satisfying, overstuffed closets

look for an inspiring business idea, but Mariana Matus,

with “underworn” items can create both stress and guilt.

PhD ’18, is not like most people. Matus is working to

In fact, the average American throws away 26 pounds of

transform sewers into public health observatories. Her

clothes per year, with 20 percent of that clothing still

company, Biobot Analytics, gathers sewage samples that

bearing tags. Ambika Singh, MBA ’16, saw an opportunity

scientists can test in real time to track data from opioid

in this conundrum and launched her company Armoire

use to infectious diseases. In the spring of 2020, Biobot

in 2016 with the help of the delta v accelerator. Today,

launched a COVID-19 testing program in partnership with

Armoire thrives in providing a “closet as a service”

MIT, Harvard, and Brigham and Women’s Hospital. This

business model: membership provides women with a

“wastewater epidemiology system” aggregated samples

curated collection of fresh fashion—enabled through a

from wastewater treatment plants nationally, providing a

mix of algorithms incorporating customer preferences,

dynamic map of COVID-19.

as well as insights from personal human stylists.



Recording and analyzing land survey data for construction

The success of these companies validates the

has traditionally been a time-consuming and costly process,

comprehensive, innovation-driven entrepreneurship

hampering decision-making and slowing project

training provided by delta v, and confirms the central

development. David Morczinek, MBA ’18, and Adam

educational philosophy of the Martin Trust Center:

Kersnowski saw that it was time to take a totally different

Entrepreneurship is not an inborn skill, but a craft that

view on the industry. Their company, AirWorks, provides

can be taught. This is especially true now, as participating

autonomous data analysis of aerial imagery harvested

students rise up to address the many challenges caused

from drones and other sources to provide accurate,

by the ongoing pandemic.

real-time information to project engineers. The resulting

“Running the delta v program for the past five years

computer-aided designs (CAD) help slash costs, while

has been one of the most rewarding things I have done

enabling developers to build better cities for future

in my life,” says Trish Cotter (Executive Director, Martin

generations. With a 2019 seed funding round totaling

Trust Center for MIT Entrepreneurship; Director, MIT

$2.3 million (led by Boston-based Innospark Ventures), AirWorks launched a comprehensive SaaS platform—

delta v accelerator; Senior Lecturer in Entrepreneurship). “The students are humble, hungry, hardworking, and

expanding market reach while decreasing turnaround time

extraordinarily talented, and it is thrilling to see how they

for aerial site plans from seven days to 24 hours.

embrace the challenge to make the world better… and



then actually do so. The pandemic will not stop them, and



I suspect many of them will be the leaders when we get


to the other side.”

Launched through delta v in 2014, Embr Labs continues to transform the whole concept of temperature control as

“The value of delta v is enormous and much larger than it first appears,” says Bill Aulet, SF ’94 (Managing Director,

a wearable device. Founded by Matthew Smith, PhD ’12,

Martin Trust Center for MIT Entrepreneurship; Professor of

Sam Shames, SB ’14, David Cohen-Tanugi, SM ’12, PhD ’15,

the Practice, Technological Innovation, Entrepreneurship,

and Michael Gibson, SB ’12, PhD ’16, Embr achieved rapid

and Strategic Management). “It becomes the goal of most

success with its Wave Bracelet. Using patented technology,

entrepreneurial students when they arrive at MIT, and for

their product uses thermal sensations to trigger the body

some it is the reason they come to MIT. It is considered the

and mind’s natural response to temperature.

Rhodes Scholarship of entrepreneurship, but what they do


must be manifested in the real world. By having such an

harder to increase the odds of their being able to realize this extraordinary opportunity.” Looking beyond the many challenges caused by the pandemic, the Martin Trust Center will continue to support its delta v students—especially those from diverse ethnic backgrounds and with global perspectives. They will also keep striving to neutralize gender bias for entrepreneurs; serve “Gen Z” in their statistically notable enthusiasm for entrepreneurship; and commit to providing the indispensable mentorship, nurturing, and team building that will drive the success of tomorrow’s business leaders.



inspirational and achievable goal for the students, it makes all of our programs better. The students work that much


“ The value of delta v is enormous and much larger than it first appears. It becomes the goal of most entrepreneurial students when they arrive at MIT, and for some it is the reason they come to MIT.”








The far-ranging universe of creativity, technology, and entrepreneurship at MIT is about to get a new home: InnovationHQ (iHQ). A 25,000-square-foot, five-floor space that will celebrate the transition of ideas forward to create impact for a better future, iHQ will serve to weave together many critical threads of real-world problem-solving at MIT Sloan—creating a tapestry far greater than the sum of its parts. Tim Miano (Program Director, MIT Innovation Initiative) has cataloged 85 different departments, labs, centers, and programs focused on innovation and entrepreneurship, plus 140 classes—that’s in addition to 45 student groups already devoted to innovation. “iHQ is meant to be a place where innovators in our community feel comfortable coming to be part of a whole ecosystem,” says Fiona Murray (Associate Dean for Innovation and Inclusion; William Porter [1967] Professor of Entrepreneurship; Co-Director, MIT Innovation Initiative; and Faculty Director, Legatum Center for Development and Entrepreneurship). “It will be a place for ‘serendipitous collisions’ with a range of people, from undergrads, graduates, and postdocs to faculty, alums, and the Greater Boston innovation community. High school students will be made to feel just as welcome as visiting global leaders.” CREATING A DATA-DRIVEN ARCHITECTURE FOR INNOVATION

iHQ will be much more than a building: harnessing the power of data, iHQ is designed to be a living and growing ecosystem that brings to entrepreneurial thinking a whole new level of efficiency and data-driven power. Tim Miano is the chief architect of a system


InnovationHQ: The New Hub of MIT’s Ideas-to-Impact Universe

designed for continuous measurement and improvement at iHQ, with data gathered and organized into three main categories: People, Processes, and Outcomes. The People category will subsume every stakeholder type involved in innovation. Crucial data from this channel will flow seamlessly into Processes—defined as the myriad labs, centers, programs, and events made available at iHQ. As optimal processes are put in place, combined with the right physical infrastructure, the end result should be better Outcomes—ideally, the kinds of startup ventures that bring world-changing impact. “When we marry together the physical space with people and the data layer,” says Miano, “it creates a sort of emergent symbiosis that we can evolve and improve, in order to see better and better outcomes.” LOOKING AHEAD: MISSION INNOVATION LEADERSHIP, IN ALL ITS FORMS

iHQ is slated for completion in 2020, but its ethos of collaboration is already in action. When the current pandemic struck, iHQ responded within only five days—launching the Rapid Innovation Dashboard to provide COVID-19 information for the MIT community, as members activate and engage to problem-solve for this crisis. Even as our institutions change and adapt to such new realities, the doors of iHQ are designed to remain open to all: providing tools optimized for problemsolvers and entrepreneurs to join and innovate together in a purpose-built community, as we collaborate to build a better future.

The Epicenter of Climatetech: Greentown Labs In 2011, a small group of cleantech entrepreneurs—including Sorin Grama, SDM ’07, (Instructor, Design for Scale and D-Lab:


Design; Entrepreneur-in-Residence, Martin Trust Center for MIT Entrepreneurship and the Legatum Center for Development and Entrepreneurship) and Sam White—joined together to rent a rundown warehouse in East Cambridge, Massachusetts. Why? In


service of a big idea: to determine whether cleantech companies


might accomplish more if they were built as an integrated part of a


community. Out of this exploration, Greentown Labs was born. Less than 10 years later, under the leadership of CEO Emily Reichert, SF ’12, Greentown Labs is the largest climatetech incubator in North America. Comprising over 100 companies centered in a 100,000-square-foot campus in Somerville, Massachusetts, Greentown Labs has supported more than 250 climatetech and cleantech startups to date (many of them with origins at MIT: Via Separations, Form Energy, Raptor Maps, and Infinite Cooling, to name a few). Member companies thrive in a vibrant community with shared resources, from office and event space to a wet lab and machine shop. In addition—under the auspices of Greentown Labs—over 50 corporate partners are engaged in making bold, science-based sustainability commitments. This year, in an effort to reinforce and further publicize their mission to stop climate change, Greentown Labs is rebranding their effort. Their new theme? “Climate action at work.” It’s work they hope to continue into a better, more sustainable future.

Pioneering Entrepreneurs


Nurturing the Next Generation of Diverse,



In Celebrating Entrepreneurs: How MIT Nurtured Pioneering Entrepreneurs Who Built Great



Companies, author Edward B. Roberts, SB ’57, SM ’58, SM ’60, PhD ’62, (Founder, Chair, and Faculty Director, Martin Trust Center for MIT Entrepreneurship; David Sarnoff Professor of Management of Technology; and Professor, Technological Innovation, Entrepreneurship, and Strategic Management) does more than review MIT’s “entrepreneurial ecosystem.” He also focuses in-depth on the great entrepreneurial heroes of MIT, past and present, in four key industries: life sciences and biotechnology, the internet, CAD-CAM and robotics, and modern finance. The book concludes with a preview of how the community is changing, and what this means for the next generation of innovators and innovations. “The last chapter expresses my hopes regarding some trends that are continuing to become more

Entrepreneurship & Innovation (E&I) Track and participants in the MIT delta v accelerator. Women are trending upward in a meaningful way.” So, too, are racial minorities. To demonstrate this promising new direction, Roberts identifies four companies he considers indicative of what is currently happening—and what’s to come—in the entrepreneurial ecosystem. Three are headed by women, and the fourth is led by a Black CEO. “I am hopeful we will be able to strengthen these trends as we move forward,” says Roberts. All author proceeds from the sale of Celebrating Entrepreneurs will support entrepreneurship programs at MIT.


of female entrepreneurs,” says Roberts. “We have counted the number of enrollments in the MBA


dominant, especially over the past 10 years. We have slowly, but steadily, been seeing meaningful growth





MIT REAP: Global Catalyst for Regional Entrepreneurship


Why are some regions of the world hotbeds of entrepreneurial and innovation activity—and accompanying economic opportunity— while other regions lag? No single element in isolation, it seems, helps one area prosper over another: a confluence of factors creates the foundations for thriving local innovation ecosystems. This insight was the genesis for MIT’s Regional Entrepreneurship Acceleration Program (REAP), a capstone initiative connecting regional leaders from around the world as they tackle the challenge of building their own innovation ecosystems. With MIT REAP, leaders from five key stakeholder groups—government, entrepreneurs, risk capital, universities, and corporations—form teams that come to MIT to leverage the deep knowledge of our faculty and research resources. Working collaboratively over a two-year period, teams gain access to the tools and insights required to strengthen and accelerate what MIT REAP leaders describe as “innovationdriven entrepreneurial ecosystems.” Since its launch in 2012, MIT REAP has served over 50 regions around the world on six continents, helping local leaders drive an ever-expanding volume of positive impact. MIT Sloan faculty members each bring their own unique expertise to the program. Scott Stern (David Sarnoff Professor of Management of Technology; Professor, Technological

Innovation, Entrepreneurship, and Strategic Management) helps regions understand the data and metrics of what they should be seeking. Fiona Murray (Associate Dean for Innovation and Inclusion; William Porter [1967] Professor of Entrepreneurship; Co-Director, MIT Innovation Initiative; and Faculty Director, Legatum Center for Development and Entrepreneurship) provides expertise on bringing scientific and technological innovation to impact through entrepreneurship, including the roles of governments, universities, and corporations in this process. Phil Budden (Senior Lecturer, Technological Innovation, Entrepreneurship, and Strategic Management), a former diplomat, advises teams on engaging all of the stakeholder groups. Bill Aulet, SF ’94, (Managing Director, Martin Trust Center for MIT Entrepreneurship; Professor of the Practice, Technological Innovation, Entrepreneurship, and Strategic Management) serves as an advocate for entrepreneurs, ensuring their voices are heard throughout the process. Shari Loessberg (Senior Lecturer, Technological Innovation, Entrepreneurship, and Strategic Management) provides insights on risk capital and funding. And, Michael A. Cusumano (Deputy Dean; Sloan Management Review Distinguished Professor of Management; Professor, Technological Innovation, Entrepreneurship, and

Strategic Management) provides key strategic insights. While participating teams gain invaluable knowledge from faculty, they also benefit from collaboration with other teams globally. HELPING REGIONS DREAM BIGGER

Regions may be hampered by thinking of entrepreneurship exclusively through the lens of small and mediumsized enterprises (SMEs): companies that may employ only a modest number of people and lack real growth potential. Thus, MIT REAP is focused on shifting thinking toward so-called innovation-driven enterprises (IDEs): ones with foundational frameworks and strategies designed to enable exponential growth. How can local entrepreneurs disrupt existing models and industries, rather than merely replicate them? “MIT REAP works with regions to define what they’re excellent at and build stronger support for those unique comparative advantages,” says Travis Hunter (Director, MIT REAP). “It also allows them to dream and envision themselves where they want to be in the future, and gives them the tools to chart a path to get there.” In a post-pandemic economy, catalyzing the proliferation of IDEs in regions around the world will be critical. “Startups are more resilient,” Hunter points out. “A few great ideas can bring up an entire generation from that region.”

Impact Over Time: Tracking the Global Entrepreneurship Lab (G-Lab) Evolution It’s also an opportunity for some to consider an entirely different career. So, if most of a student’s professional experience is in banking, in G-Lab they might test their skill augmenting a host company’s mobile app.” The impacts engendered by G-Lab range in scale, but Jester has no doubts about their significance. Student projects developed for the course sometimes persist beyond MIT Sloan. For example, when the South African entrepreneur his team was paired with decided to move forward with their recommendations, Eric Pignot, MBA ’13, changed the trajectory of his career and founded Enko Education, a network of private schools working to increase access to the world’s best universities for middle-class students across Africa. Stories like Pignot’s are not outliers. According to program surveys from the past six years, 97 percent of host companies indicated they would implement the students’ recommendations within six months. In addition, 25 to 30 percent of participating companies and entrepreneurs return to work with G-Lab student teams each year. “We like to connect our participating hosts with our broader MIT entrepreneurial ecosystem,” says Jester. “It’s about the experience of the students, but it’s also about the connections these entrepreneurs can have with the wonderful things happening on campus. Oftentimes, G-Lab will touch and impact them in very unexpected ways.”




When MBA students first asked Simon Johnson, PhD ’89, (Ronald A. Kurtz [1954] Professor of Entrepreneurship; Professor, Global Economics and Management) and Richard Locke, PhD ’89, about the possibility of applying the Entrepreneurship Lab (E-Lab) model to emerging markets, the pair was not entirely sure how such a program could work. Twenty years later, the Global Entrepreneurship Lab (G-Lab) has become the largest, most popular Action Learning course at MIT Sloan. Since Johnson and Locke formed G-Lab in 2000, over 2,500 students have applied their business management skills to work with more than 482 companies in 52 countries, utilizing MIT Sloan’s innovative project-based learning instructional design. The experience has proven transformative for everyone involved. Companies have learned how to better launch their platforms and grow their worldchanging ideas; students have expanded their worldviews while working in countries and industries they previously knew little about; and faculty and mentors have grown to further appreciate the ingenuity of the MIT Sloan community. “G-Lab allows students to explore an industry they may not have a strong background—or really any background—in,” says Michellana Jester (Lecturer, Global Economics and Management). “It’s an opportunity for them to take a supported risk in addressing a real-world business challenge while stretching their capabilities and knowledge.


Founder Age for High-Growth Entrepreneurship Youth has long been considered a requirement for success

IT industries, such as social media, rather than equally

in the world of entrepreneurship, yet simply accepting

consequential pursuits in heavy industry or business-to-

dogma has never been the practice at MIT Sloan. To that

business sectors.” In other words, the media salience of

end, Pierre Azoulay, PhD ’01, (International Programs

youth-centric businesses may effectively conceal the

Professor of Management; Professor, Technological

decisive role of older entrepreneurs in other industries.

Innovation, Entrepreneurship, and Strategic Management) and J. Daniel Kim, SM ’16, PhD ’20, Assistant Professor

Between 2007 and 2014, the average age of the 2.7 million

of Management at the Wharton School, University of

founders in the United States who started companies and

Pennsylvania, are seeking to understand the ideal age

then hired at least one employee was 41.9—more than

for high-growth entrepreneurship.

twice that of Bill Gates when he started Microsoft. For the

Along with fellow researchers Benjamin F. Jones, PhD ’03,

45. Continuing on this trajectory, the team discovered that a

Gordon and Llura Gund Family Professor of Entrepreneurship

50-year-old founder is 1.8 times more likely than a 30-year-

and Professor of Strategy at the Kellogg School of

old founder to achieve upper-tail growth. Among founders

highest-growth new ventures, the mean founder age was

Management at Northwestern University, and Javier Miranda,

who benefited from exiting through an IPO or acquisition,

principal economist with the U.S. Census Bureau, Azoulay

the edge clearly belongs to more seasoned entrepreneurs.

and Kim performed a rigorous analysis of the best data available. This entailed linking together IRS K-1 data; U.S.


Census Bureau datasets on businesses, employees, and


individuals; and U.S. Patent and Trademark Office patent

The researchers determined that age is a lot more than a

and venture-capital databases.

number. Middle-aged entrepreneurs benefit in numerous

The results of their work indeed suggest that age is a

enables them to leverage long-term relationships with

predictor of entrepreneurial success, but in the exact

co-founders or suppliers; have greater financial wealth

opposite way expected.

to draw upon; and have less difficulty borrowing capital to

ways from living longer: they have more social ties, which

fuel expansion.



“Our primary finding,” Azoulay and Kim’s team asserts, “is


that successful entrepreneurs are middle-aged, not young.

They have also had more time to start ventures and “take

We find no evidence to suggest founders in their 20s are

many more bites of the apple.” Conversely, younger

especially likely to succeed. Rather, all evidence points

entrepreneurs may lack the practical background and

to founders being especially successful when starting

technical knowledge their older peers have accrued with

businesses in middle age or beyond.”

age. This is particularly true of experience, which is by far the biggest differentiator between younger and older

They also point out that “the preeminent place of young

entrepreneurs. As Kim explains, “The number of years

founders in the popular imagination may...reflect

that one spends in the same industry as the startup is

disproportionate exposure to a handful of consumer-facing

predictive of that company’s future performance.”

“ Our primary finding is that successful entrepreneurs are middle-aged, not young. We find no evidence to suggest founders in their 20s are especially likely to succeed. Rather, all evidence points to founders being especially successful when starting businesses in middle age or beyond.”

While figures like Bill Gates and Mark Zuckerberg are often highlighted as exemplars of youthful success, there are even more overlooked stories of older, more experienced founders who have disrupted industries. Herbert Boyer cofounded Genentech—which was later acquired for $47 billion—when he was 40 years old. David Duffield cofounded Workday—which is currently valued at $43 billion—at 64, an age when many executives are eyeing retirement. Their deep experience, coupled with battle-tested wisdom, underscored their achievements. IMPLICATIONS FOR ENTREPRENEURS

Some ideas cannot wait. If Zuckerberg had delayed launching Facebook until middle age, someone else would have beat him to it. Despite this and other popular outliers, the research indicates that it would have been a mistake to dismiss the entrepreneurial advantages of middle age. Three or more years of relevant work experience in a founder’s industry was strongly associated with the odds of starting a fastgrowing company in that field. Even so, the authors would neither advise students to wait too long, nor rush them into new ventures. Here at MIT Sloan, experience—as well as the timely research of Azoulay, Kim, Jones, and Miranda—has shown us that opportunity often presents itself in ways that are at odds with conventional wisdom. Research like this also supports an important inference: entrepreneurship does

someone was born—and everything to do with the future those ideas can create.



of world-changing ideas has very little to do with the year


not discriminate. MIT Sloan is committed to welcoming entrepreneurs of all ages and backgrounds, for the value


Capitalizing on Good Especially during a period of societal upheaval, as experienced in early 2020, it’s critically important to renew our focus on innovation and entrepreneurship. Both can make our access to financial tools more equal, and greatly increase the possibility of a robust economic recovery. The pandemic will, after all, have an end. The question before us is, what will endure? To bring about long-lasting change for the greater good, MIT Sloan is redoubling efforts to disrupt the traditional limitations of the financial services industry. With the generous support of our community—combined with good old-fashioned hard work—we’re designing a future that benefits the many rather than just the few.


“ The Legatum Center’s work will be more important than ever in helping to build emerging market economies from the bottom up through entrepreneurship and innovation.” DINA H. SHERIF





HRH Princess Moudi bint Khalid, the Jacobs Foundation, and the Koch Foundation, the Legatum Center is continuously evolving to foster entrepreneurship in emerging markets. Under Sherif’s leadership, the center is launching new initiatives to accomplish its mission of improving lives through entrepreneurial leadership in emerging markets, even in uncertain times.

curated experience at MIT. As for the MIT community, it will be an opportunity to learn what these entrepreneurs are doing and how they’re innovating on the ground.




Seeing a need to encourage the flow of capital at the venture capital stage to emerging markets, Legatum has brought in a Scholar in Residence to tackle the challenge. “Investors have a really big role to play as activists right now,” says Sherif, “and where they invest their money matters.”


In addition to Legatum’s flagship fellowship program, the center plans to launch a new fellowship designed to bring entrepreneurs from emerging markets to MIT who can’t take time off to pursue a degree, but could benefit from being on campus over a period of three to four weeks. The learning will be a two-way street. Entrepreneurs— starting with individuals from Africa and expanding to other continents— will benefit from a highly focused,


The pandemic has caused widespread economic disruption, with emerging markets struck especially hard. While the obstacles to growth are formidable, Dina H. Sherif (Executive Director, Legatum Center for Development and Entrepreneurship) sees reasons for optimism in the face of this once-in-ageneration challenge. Sherif points out that the very nature of emerging market cultures may give them greater “emotional resilience” than other, more developed markets. Many emerging markets have unstable political situations, so the rule of law is not necessarily enforced. Entrepreneurs in these countries are forced to find creative ways to build sustainable and responsible businesses. Therefore, when the dust settles, they may be better equipped to navigate uncharted terrain than those countries that are less familiar with instability and crisis. With the support of the Legatum Group, the Mastercard Foundation,


The Legatum Center: Driving Innovation in Emerging Markets at a Time of Profound Change


Seeding Youth Entrepreneurship in Africa and Beyond

Meghan McCormick, MBA ’18, (Legatum Fellow) is acquainted with serving the underserved: as a member of the Peace Corps in West Africa, she promoted youth entrepreneurship. But it’s possible that OZÉ—an app-based service for small business McCormick helped to found—will make waves that

help small businesses launch and grow across emerging markets.” Moving small business owners beyond paper ledgers and receipts, the OZÉ app takes a mere three clicks to log a simple transaction— even offline. “We’re geotagging that data; they can add in more detailed descriptions; and each transaction can be marked paid, unpaid, or partially paid.” OZÉ is also using the data to connect the small business owners with affordable loans. All of which means insight—and unlocked potential.


something that’s good for Ghana. Make something that’s good.’” OZÉ’s mission is creating “tools that


go far beyond one region. She explains: “A stakeholder said, ‘Look, don’t come in here and make


Finance in the Age of AI, Cryptocurrency, and Big Data The transformation of finance over the past few years has been profound, as big data, artificial intelligence (AI), and cryptocurrency have merged to create a highly complex industry that continues to rapidly evolve. For Antoinette Schoar (Stewart C. Myers-Horn Family Professor of Finance; Professor, Finance), finding meaningful patterns within this structure is both a passion and a calling. Schoar’s work reveals the extraordinary opportunities

Service businesses hit hard by the pandemic, for example,

that are hidden inside this shifting mosaic: new finance

may suffer a poor credit report through no fault of their own.

models enable more entrepreneurs to launch companies,

“When banks write AI targeting algorithms,” says Schoar,

venture capitalists can lower their risk and increase their

“they’ll have to be very explicit. If somebody has an unlucky

chance of success, and variations in cryptocurrency

shock—like getting sick—will we now reduce credit for them?

valuations by country reflect the value of trust in traditional

This will be a really big issue.”

institutions. When used wisely, data and AI can also help remove bias from hiring and other critical processes.


In addition to facilitating the invention of new products, Along with these opportunities, however, come new

data-driven technologies are reducing the cost of starting a

challenges that will require society to engage in difficult

business. In the past, a new tech venture might have required

conversations—and the outcomes will shape the future

extensive physical servers and other infrastructure, whereas

of finance.

today many of these fixed costs are now variable costs due to the proliferation of rentable cloud-based services.




Schoar believes that the sheer volume and detail of


For venture capitalists (VCs), the lower cost of starting a

financial data now available to lending institutions has

business is paired with changes that simplify how they can

broad implications. In the past, for example, financial

manage risk. Five or ten years ago, a typical VC would have

institutions found it difficult to lend to “subprime”

spent months performing due diligence before investing in a

populations because they were all considered relatively

startup. Today, VCs are more likely to make smaller

risky. As a result, institutions balanced their risk by

investments in numerous startups, including some with similar

providing an average interest rate to the entire population.

product offerings, without performing laborious due diligence

Today, by pairing ubiquitous access to deep data with

at the outset. To further simplify, VCs may make their up-front

advanced algorithms, lenders can better differentiate

investments as “convertible notes” designed to automatically

“good” peers from “bad” peers. While this reduces

convert in the event of a future funding round. VCs are

the cost of capital for people considered a better

essentially letting market data prove out which startup

credit risk, it puts those who are considered a worse

becomes a success, spreading their risk to multiple potential

risk at a disadvantage.

entrepreneurs within a similar sector.

To make the challenge starker, while poor credit can be a

The impact of these shifts may be significant: Many new

reflection of unwise decisions by an individual or company,

entrepreneurs will be women and minorities who in past years

another major factor can play a significant role: bad luck.

did not have access to capital on an equal footing with others.


As of 2019, more than 50 million investors were trading Bitcoin and other cryptocurrencies around the world. Working in collaboration with Igor Makarov, PhD ’06, Schoar conducted a systematic analysis of the trading and efficiency of cryptocurrency markets. Their analysis revealed wide differences in cryptocurrency valuation between markets, rooted in the foundational institutional dynamics and public sentiments in each country. For example, between December 2017 and February 2018, the daily average differential between the United States and Korea was greater than 15 percent and even reached 40 percent. What is the reason behind this “kimchi premium”? Much of the wide price disparities are based on limits to the mobility of capital between countries, which in turn limits arbitrage opportunities. Simply put, it’s not easy to

“ When banks write AI targeting algorithms, they’ll have to be very explicit. If somebody has an unlucky shock—like getting sick—will we now reduce credit for them? This will be a really big issue.”

buy cheaply in New York and sell high in Seoul. Deeper analysis showed that Bitcoin and other cryptocurrencies seem to have


more value for citizens in countries where financial markets are underdeveloped. “The more trust there is in the financial system,” says Schoar, “the less valuable the cryptocurrency seems to be.” It remains to be seen what the financial shocks of 2020 will mean for cryptocurrency markets, AI, and big data. One thing, however, is clear: the pace of change will likely continue to




accelerate as entrepreneurs keep innovating.


Driving Upward Mobility with a Mobility Network



Logistics and mobility are among the greatest challenges facing entrepreneurial growth in sub-Saharan Africa, so Adetayo Bamiduro, MBA ’15, (Legatum Fellow) and Chinedu Azodoh, MFin ’15, decided to take both challenges on at once. The enterprise they co-founded in 2015, Metro-Africa Express—or MAX.ng—provides last-mile delivery and online retail infrastructure by using mobile and web platforms to connect consumers, retail businesses, and independent drivers in real time. The platform connects users to carefully vetted, professional motorcycle-taxi drivers (known as “MAX Champions”) via a mobile app. Those drivers in turn provide swift, reliable local delivery services to residents and corporations in the commercial centers of Lagos, Nigeria. But their goals are larger still, explains Bamiduro: “We are eliminating all logistic, payment, and technology barriers that have prevented African retail from attaining escape velocity.” The company aims to connect more than 100 million users with 40 million retail businesses across 50 cities in Africa. For Bamiduro and Azodoh, financial success goes hand in hand with creating more opportunities for Africans to thrive while also providing safer transportation for all.



In the coastal city of Lagos—home to 21 million people— the streets are heavily congested. Bamiduro says some people spend up to 70 percent of their work hours stuck in gridlock on roadways that are not in the best condition. Informal “mototaxis” provide one way to get around, but 98 percent of drivers don’t wear helmets. Nor are drivers well trained or well paid. MAX.ng provides all its drivers with high-quality helmets, matching yellow outfits, and brand-new bikes. They have the option of getting a loan for the bikes based on a one-year repayment plan. And nobody hits the road without receiving extensive training on basic traffic rules. Best of all, MAX.ng drivers make three times more money compared to working independently. In January 2020, MAX.ng hit a bump in the road when Lagos enacted a ban on commercial motorcycles, leaving millions of residents stranded without alternatives. Bamiduro and Azodoh are undeterred. Committed to social impact, the company (where allowed) is ramping up delivery operations to support individuals—especially the elderly, who require extra help.

“ We’re that much closer to accomplishing our number one mission—building a more robust Nigerian and African economy.”








Jump-Starting America After the Second Wave


The COVID-19 crisis has added new levels of urgency and relevancy to the work of MIT community leaders. Many faculty have adjusted rapidly to evolve their thinking to address the pressing demands of the pandemic. This is especially true for MIT Sloan’s Simon Johnson, PhD ’89 (Ronald A. Kurtz [1954] Professor of Entrepreneurship; Professor, Global Economics and Management), the former chief economist of the International Monetary Fund. In the spring of 2019, Johnson and MIT Ford Professor of Economics Jonathan Gruber, SB ’87, published Jump-Starting America: How Breakthrough Science Can Revive Economic Growth and the American Dream. The book proposed a plan to boost the fortunes of American workers—and American science—with a blueprint for developing innovation in dozens of regions across the nation.

A year later, the world is in the throes of the COVID-19 pandemic and struggling to escape the clutches of a potential second wave of infections. Johnson still believes his and Gruber’s plan for jump-starting the American economy is applicable, but also acknowledges that significant steps must be taken by those in positions of power. First, he says, we must acknowledge the reality of our post-virus world. “Once you reconcile yourself with this reality, many things become clearer—including how to resist the current onslaught, and how to reopen the economy responsibly. With the right understanding, we can rebuild appropriately, with greater resilience and more fairness. We have to start by getting the economy off the floor, then jump-start it to accelerate growth focused on science and technology.”


In Jump-Starting America, Johnson and Gruber recount the creation of the National Defense Research Committee (NDRC) under Vannevar Bush, PhD 1916, the former dean of the School of Engineering at MIT who was then president of the Carnegie Institution for Science. Through the NDRC, public funds were used to support a massive project that would not only help the Allies win World War II, but also would transform the United States into a scientific and economic powerhouse. By jump-starting this engine today, the authors suggest the nation can regain its foothold in both areas of expertise on a global scale—even in a post-virus world.

in the private sector are working toward,” says Johnson, who joined forces with Retsef Levi (J. Spencer Standish [1945] Professor of Operations Management; Co-Director, Leaders for Global Operations Program); Kate Kellogg, PhD ’05 (David J. McGrath jr [1959] Professor, Management and Innovation; Professor, Work and Organization Studies); Valerie Karplus, SM ’08, PhD ’11 (Assistant Professor, Global Economics and Management); Vivek Farias (Patrick J. McGovern [1959] Professor; Professor, Operations Management); and others to establish the COVID-19 Policy Alliance. “We know many people who are on massively convergent tracks right now, closing in on the enemy. Ultimately, we need to build resilience to financial

“ With the right understanding, we can rebuild appropriately, with greater resilience and more fairness. We have to start by getting the economy off the floor, then jump-start it to accelerate growth focused on science and technology.”


“The only way to beat an exponential enemy is with exponential forces, and that’s what a lot of people

crises in the same way that we build resilience to health crises.” This alliance consists of thought leaders from MIT Sloan, area hospitals, and local government, but it is by no means the only initiative of its kind to spring from the brightest minds at the Institute. As Johnson explains, “A large number of people are trying—in myriad ways—to limit the human damage from COVID-19, and then build something better, stronger, more resilient, and with a different approach to economic and human justice.” Even so, the economist cannot help but marvel at just how inspiring it has been to witness all these efforts— past and present—at MIT Sloan. “There are some really nice words in the entryway of the main building about principled leaders and our role in the world. I’ve always believed in those words. I’ve always thought that is what we are,” he says. “But I have to tell you, I have never seen them in operation as intensely as I have—in and around MIT Sloan—over the past few months.”


“There’s a number of implications around viruses and health, but also resilience of economic systems,” says Johnson. “For one thing, if you’re providing critical medical supplies to hospitals or nursing homes, you won’t be allowed to source those outside the United States. We are going to create a lot more manufacturing jobs in this country because we are not going to buy things that are essential to our resilience from anyone else.” Aiming for such economic resiliency may seem like a bold goal, but considering the millions of Americans who have lost their jobs because of the COVID-19 crisis, it couldn’t be timelier. “We’re facing a very high unemployment economy, and people are already desperate for jobs,” notes Johnson. “We have skilled labor available and wanting to work. All our capabilities need to be recombined. We must have a strategy.” Thanks to the blueprint laid out by Bush and the NDRC, Johnson believes such a strategy already exists.







The Three Forces Reshaping Finance Gary Gensler (Professor of the Practice of Global Economics and Management; Co-Director, MIT’s Fintech@CSAIL; and Senior Advisor to the MIT Media Lab Digital Currency Initiative) and fellow Wall Street veteran Richard Berner have seen the financial world from nearly every perspective: as private bankers, government officials and regulators, and academics. What do they see in the future?





While companies like Google have always operated in the data business, data as a primary creator of value is relatively new to the financial sector. But with artificial intelligence and machine learning evermore integrated into the financial services industry, Gensler suggests that the field is poised to leverage data in new ways. In fact, Gensler observes, financial services companies increasingly explore the business model of commercializing data—while giving away traditional “services” at no charge. He cites Robinhood, a startup allowing clients to trade stocks and bonds at zero commission, while selling its order flow to third-party market makers. BRICK AND MORTAR VS. FINTECH: HOW WILL PHYSICAL BANKS FARE?

Of 14,000 physical commercial bank offices in America 30 years ago, 5,600 remain. But while traditional banking is clearly in decline, it’s still an important presence in certain regions—offering a valuable source of capital to smaller-scale companies. Gensler and Berner predict they

won’t be vanishing any time soon. Nevertheless, in a world where two billion users now access financial services through mobile devices, fintech companies will loom large—as will the increasing diversity of services they offer. As Berner describes it, “a continued blurring between commercial banks and other financial intermediaries” will be the ongoing trend. NEW REGULATORY NEEDS, AND RISKS

Gensler and Berner recommend a regulatory framework for fintech companies that allows them to explore innovation, while keeping a keen eye on operational risk and cybersecurity. After all, the more such entities emerge, the more they become an avenue for potential risk. But in order to allow for constructive breakthroughs, such caution must be balanced. In Gensler’s words, “We must preserve the freedom for firms to fail.” As firms begin to dig out of the rubble of 2020, it’s likely that entirely new financial structures will emerge to meet the needs of a changed economic landscape.





With an enviable client roster including Fox, FedEx, JetBlue, and Nordstrom, Okta is the industry leader in identity. But not long ago, this powerful productivity and security resource—the recipient of $230 million from investors like Greylock Partners and Sequoia Capital—was still a dream of co-founder Frederic Kerrest, MBA ’09. Launched in 2009 (during the second semester of his graduating year at MIT Sloan), Okta went public in 2017 and is now valued at approximately $15 billion.


Okta’s Integrated Identity Platform for the World’s Largest Organizations

their business models to engage with distributed users, they will continue to embrace cloud and mobile,” says Kerrest. “Identity is essential to helping them adopt new technologies while both engaging and protecting their workforces and customers.” RETHINKING THE FUTURE OF WORK


As an identity management firm, Okta enables any company to use any technology. With Okta, employees can access a company’s apps via a dashboard relying on a single username and password. Organizations can also leverage Okta to securely connect their customers—helping developers build secure, seamless experiences. Kerrest observes that there’s never been a more critical time for businesses and organizations to invest in the benefits of an identity solution. With an ever-growing list of notorious—and sometimes disastrous—hacks on industry and government, technology companies have to develop solutions that respect both user-side human factors and the indefatigability of hackers around the world. “The world is rapidly changing. As organizations work to manage remote workforces and change

Okta’s technology enables people to access the tools they need from any device, network, or location. With a global pandemic forcing millions to work from home, it has become indispensable. Leveraging its experience as a technology leader, the company has also created a framework for the future of work called “Dynamic Work.” Kerrest’s vision is to personalize the work experience. “We’ll enable employees to work from wherever makes most sense for them, while enabling them to do their best work and be their most productive,” says Kerrest. “Even before COVID-19, macroeconomic, generational, and technology trends were impacting the workforce in a way that made us rethink work. Dynamic Work has helped us prepare for changing employee preferences and the new reality of work today.”


Approach to Solving the Student Debt Crisis


In Crisis, Opportunity: An Entrepreneurial

Every problem, however intractable, reveals an elegant solution—when regarded from a novel point of view. In the case of Laurel Taylor, EMBA ’15, and her company FutureFuel.io, the problem was students in debt. The novel point of view? That of potential employers of students in debt. By offering assistance in repaying employees’ student debt, employers give themselves

loans in one place. With student loans becoming the second-highest consumer debt category in America, this was a crisis even before COVID-19 threw millions out of work. In the months and years ahead, FutureFuel.io’s platform can offer hope to those burdened by debt, while providing employers with a better way to hire and retain the best and the brightest.


help employers do just that: consolidating the management of an employee’s student


a powerful tool for recruiting top talent. FutureFuel.io’s platform offers a range of ways to



The Impact of Mobile Credit on Africa’s Socioeconomic Mobility MIT Sloan’s Tavneet Suri (Louis E. Seley Professor of Applied Economics; Associate Professor, Applied Economics) has spent 10 years studying the use and impact of both “mobile money” and “digital credit” in sub-Saharan Africa, particularly in Kenya, and exploring the impacts of these relatively new economic tools.





In her previous work, Suri examined mobile money—a phone-based application (not requiring a “smart” device) developed to enable users without bank accounts to deposit, transfer, and withdraw funds from their mobile phones. She found that mobile money has had profound effects on traditionally “unbanked” populations, allowing them to join in crucial areas of economic activity. The impact was dramatic: mobile money access not only increased household consumption in Kenya but also increased savings, reduced poverty rates, and showed extreme poverty rates declining by a full 2 percentage points (meaning 196,000 households moved out of “extreme poverty”). It also broadened the economic opportunities available to women. DIGITAL CREDIT

Her latest work attempts to evaluate the effectiveness of digital credit, and the availability of other financial instruments, in addressing the fundamental financial well-being of populations. As Suri explains it: “When

something bad happens, mobile money can bridge the gap.” Access to these services, her work indicates, can provide strategies to prevent relatively small monetary setbacks from becoming full-blown financial disasters for families. In the case of digital credit, a simple phone process allows users to request a loan: automated processes assign a credit score and deposit a requested loan into a mobile money account—all without loan officers or bank branches, reducing costs for banks themselves.



Suri recently studied 4,200 households—each close to the lower-end cutoff point for eligibility—two years after opening their digital accounts, and discovered two salient results: (1) an increase in “financial resilience and wellbeing” (i.e., the ability to still make crucial purchases, even in the face of temporary financial setbacks); and (2) an increase in the propensity to spend on education. The latter finding, of course, suggests a whole raft of potential benefits for social mobility.

Gataca’s Verifiable Route to Financial Identity Confirmation and Security To navigate today’s digital world, individuals must create dozens of

“These credentials respond to recent global standards,” she adds,

accounts within government agencies, financial services, and

“but they are also cryptographically verifiable.” In other words, a

other institutional systems that require them to consign sensitive

Gataca user’s digital ID wallet will be easily accessible and tightly

personal data to large centralized hubs. Despite using the latest

secured through cryptography and biometrics.

methods of secure identity validation, however, these frequent targets of identity theft cost global businesses about $45 billion

Thanks to the MIT Sandbox Innovation Fund and the MIT delta v

annually. “They concentrate so much sensitive information,”

accelerator, the company is already putting this concept into

Irene Hernández, MBA ’18, explained at the 2018 MIT delta v

practice as one of the few providers in the world with a working

Demo Day, “that they become honeypots for hackers.”

product. In early 2020, Gataca partnered with two major national governmental organizations in Europe to develop their first

Hence Gataca, a technology startup dedicated to overcoming

blockchain-based, decentralized identity certificate. Hopefully,

the inability of traditional authentication systems to better secure

this collaboration will lead to greater acceptance of the new

offline credentials online. After joining the MIT Media Lab in 2017

technology by government agencies and the private sector.

to study the rise of identity fraud and how blockchain might help fight back, Hernández realized that decentralized computing was

“In order to roll out this project now, you need a really strong

capable of greater security, more efficiency, and less risk. How?

industry with a strong interest in making this happen,” Hernández

By giving control of personal data back to the users.

explains. “That’s the financial industry.” More traditional financial institutions have struggled to meet expensive know your customer

“Consumers will have one single digital identity that all the

(KYC) compliances, improve user experience, and secure

different service providers will use to access the information they

customer data—so they’re on the lookout for something new. With

need,” says Hernández. Instead of multiple accounts with

Gataca’s decentralized identity architecture and verification, they

numerous vendors, Gataca stores all credentials—driver’s license,

could solve all three problems simultaneously.

passport, academic certificate—in a single digital ID wallet.

“ What decentralized digital identities can provide is a single sign-on capability, combined with the security level of our governmentissued certificate.”






Ensuring a Fairer, Smarter Digital Economy Rapid digital transformation has empowered people, governments, and companies to respond to the world’s most pressing problems with stunning velocity. Unfortunately, the rapid speed of advancement has also accelerated the economic polarization of society. Not everyone is benefiting equally, so the MIT Sloan community is working diligently to overcome these and other obstacles. From faculty research offering guidance on how to succeed in this digital world, to student and alumni entrepreneurial explorations of new medical technologies, the goal remains the same—to




Transaction platforms, meanwhile, bring buyers A. and sellers together, as in a EL A H MIC marketplace or a ride- or roomsharing app. One thing they have in common is that new platform ventures and first movers are likely to fail. “Our data shows that, although some platform businesses can grow extraordinarily fast, most lose extraordinary amounts of money,” says Cusumano. For example, Uber’s platformization of the low-profit taxi industry was simply a highly efficient way to drain cash. Yet, the risk of failure isn’t going to slow the entrepreneurial rush to capitalize on new platform business opportunities. For those eager to take the leap, The Business of Platforms analyzes how some platforms are built with a hybrid strategy; how traditional companies can compete with emerging digital platforms; and how platform thinking can help entrepreneurs build businesses that involve everything from gene editing to quantum computing. Given the level of disruption caused by new platforms, entrepreneurs can expect governments to step up with new regulations. However, Cusumano cautions that platform businesses should not wait for government rules to take effect—especially if those rules don’t work for them. Instead, they should regulate themselves as well as work with governments to even the playing field between platforms and traditional competitors.


Michael A. Cusumano (Deputy Dean; Sloan Management Review Distinguished Professor of Management; Professor, Technological Innovation, Entrepreneurship, and Strategic Management) has a relentlessly inquisitive mind when it comes to the burgeoning world of platform businesses. His thinking poses numerous questions: How did Microsoft, Apple, Amazon, Google, Facebook, and other digital platforms become so dominant and immensely valuable? What makes one platform business successful while others fail? Considering the staggering amount of influence current platform businesses possess, what role should governments play in regulating newer—and potentially more powerful—platforms? These inquiries led Cusumano and his coauthors, Annabelle Gawer, PhD ’00, of the University of Surrey, and David B. Yoffie of Harvard Business School, to write The Business of Platforms: Strategy in the Age of Digital Competition, Innovation, and Power. Published in May 2019, the book seeks to help entrepreneurs build platform businesses that stand the test of time. After analyzing over 250 platforms from the past 20 years, Cusumano and his coauthors determined that there are two main types of platform businesses. Innovation platforms build value by enabling outside firms to provide complementary products and services (such as smartphone apps) that make the platforms (such as a PC, smartphone, or social media app) increasingly valuable.


The Principles Behind Successful Platform Businesses


ensure a fairer, smarter digital economy for all.





Who’s ‘Bot’ in on Artificial Intelligence, and Why It Matters

are not limited to what we think in our brains—they take into account what the brain in our pocket might think as well.” RENÉE RICHARDSON GOSLINE


“ Our thinking and our processes


There are two modes of thinking: system 1 thinking consists of the rapid calculations and decisions people make almost automatically, while system 2 thinking is much slower and more deliberate. For example, reacting suddenly to a loud noise exemplifies system 1 thinking, whereas the subsequent investigation into the source and circumstance of the noise demonstrates system 2 thinking. To determine whether someone was more likely to rely on AI for their decisions, Gosline used a Cognitive Reflection Test (CRT) to measure proclivities for system 1 or 2 thinking. Participants were also shown a range of scenarios intended to test their aversion to, or appreciation for, algorithms. It turns out that 62 percent of the population has an aversion to algorithms. However, the study found that system 2 thinkers were significantly more inclined to rely on algorithms. What’s more, these thinkers tend to be higher-performing individuals. “These are powerful people,” says Gosline. “If they are reliant on algorithms and those algorithms are biased, what are the implications for society?” Based on these initial findings, Gosline believes there is a strong need for building bridges between data scientists and behavioral science experts. By combining these particular areas of knowledge, scientists can create AI-enhanced experiences that work for all modes of thinking.


Imagine a person in a car dealership trying to decide between two vehicles. One car is a gas-sipping hybrid. The other is a sleek convertible that will go from zero to sixty in a head-snapping three seconds. According to Renée Richardson Gosline (Senior Lecturer and Research Scientist, Marketing), this decision is only one of the 35,000 an average American makes every day. Yet, human decision-making is quickly giving way to choosing between hybrids and sports cars with the help of AI-driven bots. The question now is: what factors determine whether a human will rely on a machine for organizational decision-making? “We are quickly evolving from Homo sapiens to Homo technologicus,” says Gosline. “Our thinking and our processes are not limited to what we think in our brains—they take into account what the brain in our pocket might think as well.”


Laying the Foundation of Entrepreneurial Strategy At the Martin Trust Center for MIT Entrepreneurship’s Antifragile Speaker Series in April 2020, Scott Stern (David Sarnoff Professor of Management of Technology; Professor, Technological Innovation, Entrepreneurship, and Strategic Management) said entrepreneurship is not that complicated. “You create value for other people and deliver that value to them—all while bringing a real passion to your work,” he explained. However, this does not mean it is easy. On the contrary, entrepreneurs struggle with decisive uncertainty when attempting to transform their ideas into commercially viable products. This is especially true of today’s digital reality, in which people and companies must advance faster than the speed of thought. Stern and Erin L. Scott (Senior Lecturer in Technological Innovation, Entrepreneurship, and Strategic Management) hope to bring clarity to this process in their forthcoming book, Foundations of Entrepreneurial Strategy, which presents a new framework for startup founders. Along with Joshua S. Gans of the University of Toronto, Stern has spent decades studying hundreds of startups to determine how the successful ones ultimately decided which strategic alternative to use. They discovered that, by reformulating the foundations of entrepreneurial strategy



itself, startups can make far more powerful choices.



“ You should always be looking for new ways to navigate this process. This allows you to raise money, build your team, and create a meaningful business that can impact the world.” SCOTT STERN



Entrepreneurs, by definition, must choose which strategy

This rule is not for everyone. Yet, for startup founders whose

to use when commercializing their ideas. Precisely how

entrepreneurial choice process is more active than not, it

this entrepreneurial choice process plays out will vary

helps emphasize the significance—and the power—of their

depending on the company, but more often than not, it

choices. This is one of the biggest implications of Stern’s

involves searching for the best possible strategy. Startup

ongoing research and his and Scott’s forthcoming book:

founders who adopt this typical approach focus more on

entrepreneurs should reject passivity and adopt a more

optimization and less on choice. That is to say, they decide

active approach to bringing their ideas to market.

what to do by deciding what not to do. In doing so, they may discover new tools to aid their Instead of weeding out the underperformers to find the

strategy—like the “Entrepreneurial Strategy Compass”

best alternative, the authors suggest entrepreneurs keep

that Gans, Scott, and Stern established in 2018. This

searching until they identify multiple strategies that are

particular framework provides startup founders with choices

equally viable. In the 2019 Strategic Management Journal

about which customers to target, the type of organizational

article, “Foundations of Entrepreneurial Strategy”—funded

identity to assume, what technologies to deploy, whether to

by the Edward B. Roberts (1957) Entrepreneurship Fund

collaborate or compete with specific competitors, and—if

and the Jean Hammond (1986) and Michael Krasner (1974)

the latter—ways to position the company against them. The

Entrepreneurship Fund—Gans, Stern, and Jane Wu (PhD

Entrepreneurial Strategy Compass neither removes nor

candidate) dubbed this the “Test Two, Choose One” rule:

reduces the uncertainty that launching a startup entails, but

entrepreneurs search until they find at least two strategies

it does offer practical means for making a choice.

of equal expected value before making a choice. By becoming more active in their entrepreneurial strategy, For those whose attempts to create or capture value

and by emphasizing the importance of choice,

adhere to specific conditions, this rule may prove quite

entrepreneurs who employ this architecture can better

useful. There may be more than one method for

succeed in the digital world. They can also have a greater

commercializing an idea, but there are limits to finding

impact. “You should always be looking for new ways to

so many alternatives. Per the rule, only one approach can

navigate this process,” Stern concluded his Antifragile

be taken at a time, and commitment-free learning cannot

Speaker Series talk. “This allows you to raise money, build

reduce the uncertainty or clear up the noise associated with

your team, and create a meaningful business that can

the potential outcomes. Even so, Stern and his colleagues

impact the world.”


choices they have to make.


believe this tactic allows entrepreneurs to focus more on the



for Success in a Digital World BUILD X-TEAMS

be the understatement of the century, as companies shift

To overcome

course abruptly to deal with rapid change. However digital

bureaucratic chains,

our world was in 2019, it is now the case more than ever.

build flexible teams


To say that today’s business environment is volatile may


Five Adaptive Leadership Practices

Deborah L. Ancona’s (Seley Distinguished Professor

that collaborate

of Management; Professor, Organization Studies; and

internally and link to knowledge and

Founder, MIT Leadership Center) insights into this altered

innovation partners outside themselves.

landscape are incredibly relevant. In the Winter 2020 issue of the MIT Sloan Management Review, she explains the five


leadership practices that executives should adopt to


achieve greater resiliency and success in turbulent times.

You can—and should—escape the perils of narcissistic, debilitating behaviors by focusing on challenges and


inspiring your teams to tackle tough problems.

Do not simply demonstrate that you are in charge. Help everyone understand your unique way of leading,


given your values.

Adaptive leadership in a digital world requires structuring organizations so these steps can take place.


Coined by organizational theorist Karl Weick, “sensemaking” is when people create meaning out of

Adopting these practices won’t be easy. Many leaders will find learning and implementing them to be challenging, at

the messy world around them. Sensemakers collect data,

best. Even so, those companies that successfully employ

learn from others, and look for patterns to accomplish this.

Ancona’s suggestions will find themselves better suited for an ever-changing digital world.





A Grand Scope for Early Cancer Detection Not counting some kinds of skin cancer, the Centers for Disease Control and Prevention says that colorectal cancer is the third leading cause of cancer-related deaths in the United States. It’s also the third most common cancer in men and women. Unfortunately, gastroenterologists risk missing a polyp or a group of

cancerous cells while performing routine colonoscopies. This can lead to belated cancer detection, higher chances of mortality, and increased healthcare costs. At Iterative Scopes, CEO Jonathan Ng, MBA ’20, and his team—including fellow Sloanies Daniel Wang, MBA ’19, Sloane Phillips, MBA ’19, and Lavi Erisson, MD, MBA ’19; and MIT alumni Austin Wang, SB ’20, MEng ’20, and Avi Walden, SB ’18—are working to improve the effectiveness of these screenings with a combination of machine learning and computer vision. The company has created a database-driven model to help specialists who regularly perform colonoscopies by identifying and removing polyps more effectively and efficiently. Since participating as a startup in the 2018 MIT delta v accelerator, Iterative Scopes has raised over $7 million to fund further clinical trials and, eventually, commercialize its proprietary technology.



Using Virtual Reality to Improve Quality of Life


Being in a wheelchair is no longer a barrier to experiencing scuba diving in the Bahamas or hiking in the Grand Canyon.



famous landmarks or play with puppies together. Whether users want to try new things or revisit meaningful places from their past, this technology is bringing joy and connection to the people who need it most. Rendever’s team produces and releases new content to the platform every other week. They also offer clients the option to create personalized content. “There was an older adult who just kept saying, ‘I want to go home,’ but she was in an assisted living community,” says Hayes. “We were able to type in the address of her home and take her there. She immediately welled up with tears of joy.” Bringing magic to the lives of the elderly was made possible thanks to the innovative culture at MIT Sloan. The idea for Rendever was first sketched, quite literally, on a napkin at MIT’s Muddy Charles Pub during a pitch Hayes made to Lally. During the summer, the team acquired additional support from the MIT delta v accelerator at the Martin Trust Center for MIT Entrepreneurship. Since its launch in 2016, Rendever has integrated its platform into more than 150 senior living communities and hospitals across North America.    MITSLOAN.MIT.EDU/CAMPAIGN

At a time when social distancing has become commonplace, it is important to remember that one particular demographic has always struggled with the challenge of isolation. The stigma around aging has directly contributed to the loneliness epidemic that is experienced by many older adults around the world. Through recent experiences, we have seen a window into the isolation, depression, anxiety, and restlessness this population experiences daily. But for them, there isn’t a reopening plan set to roll out over the next three months. However, there is hope thanks to Rendever, a startup cofounded by Reed Hayes, MBA ’17, and Dennis Lally, MBA ’17. Rendever is the first startup to harness the power of virtual reality (VR) to help older adults reengage and stay connected with the world, even amidst this time of social distancing. The company’s resident engagement platform leverages the power of immersive experiences to help participants travel anywhere in the world and do any activities they like. Being in a wheelchair is no longer a barrier to scuba diving in the Bahamas or hiking in the Grand Canyon. The platform also allows multiple headsets to sync together, enabling groups to tour


Shaping the Work of the Future The world of work is in a state of constant upheaval, with major change occurring both rapidly and as part of long-term trends. Advanced technologies in robotics and artificial intelligence may spur a new age of productivity, but it is important to understand how these emerging technologies will shape the work of the future and how prosperity can



be more equally shared at all levels of society.


In 2018, MIT President L. Rafael Reif convened the MIT Task Force on the Work of the Future, with the goal of “understanding the relationships between emerging technologies and work, and to explore strategies to enable a future of shared prosperity.” Led by Elisabeth B. Reynolds, PhD ’10, David A. Mindell, PhD ’96, and David Autor, the task force is an Institute-wide initiative and features members of the MIT Sloan faculty, including Tavneet Suri (Louis E. Seley Professor of Applied Economics; Associate Professor, Applied Economics), Yasheng Huang (Epoch Foundation Professor of International Management; Professor, Global Economics and Management), Thomas Kochan (George Maverick Bunker Professor of Management; Professor, Work and Organization Studies; Co-Director, MIT Sloan Institute for Work and Employment Research), and Paul Osterman, PhD ’76 (Nanyang Technological University [NTU] Professor of Human Resources and Management; Co-Director, MIT Sloan Institute for Work and Employment Research). In

the fall of 2019, the task force produced its interim report, The Work of the Future: Shaping Technology and Institutions. As research continues, the task force released a series of briefings this summer, and will publish a final report in November 2020. The interim report portrays a vivid, evidence-based picture of the evolution of work that finds ample reason for concern. The report also offers an equal dose of optimism—provided policymakers, businesses, and workers are all part of the solution. THE CHALLENGE: MULTIPLE FACETS OF INEQUALITY

Earnings growth over the past 40 years has been unequal and slow. Incomes for those with college and post-college degrees have risen, while all others have fallen. In 2018, men without college degrees working full-time earned 10 to 20 percent less per week than they did in 1980. Labor productivity did jump 75 percent between 1973 and 2016, but this didn’t necessarily translate to

worker compensation, which rose 12 percent for those with more education. Less-educated workers were deemed “easier to replace with machinery,” though minorities were hit even harder. Between 1980 and 2015, the gap between Black and white workers’ earnings— 27 percent in 1980—closed by less than 1 percent.

all decisions regarding layoffs and closings fully account for the real costs of such actions. Second, the U.S. government should revisit the National Labor Relations Act of 1935 and other statutes that impose unnecessary restrictions on worker representation. AVOID “SO-SO” TECHNOLOGIES


The type of shareholder capitalism championed by the United States is highly productive, but its dynamism comes at the expense of employees. This aspect of the American market economy is long overdue for a thorough review. Though no perfect model exists, Germany and other nations offer plenty of alternative examples. Ultimately, two possibilities for change are clear. First, firms should treat their workers as stakeholders, so that


Businesses have an opportunity to introduce innovative technologies capable of freeing employees from menial tasks so they can focus on higher-value work. For example, if robots stock retail shelves, sales associates can spend more of their time advising customers on what products to buy. Although automated customer service bots are here to stay, companies can work to make them a little more human while also ensuring that real people have higher-paying jobs. New technologies should complement workers rather than replace them.



A host of alternative educational paths can enable the inclusion of a broader swath of workers in economic prosperity. Skill development that relies on work-based learning programs, such as co-ops and apprenticeships, has proved successful in Germany and Switzerland, and can also work in the United States. In addition, “sectorial employment programs” can provide on-the-job training without requiring formal apprenticeship positions.

Some technologies that replace workers don’t actually boost productivity or improve the customer experience. As a result, workers may be forced out of jobs by technologies that actually make the customer experience worse. Institute Professor Daron Acemoglu and Pascual Restrepo, PhD ’16, identify self-checkout kiosks deployed at retail stores and computerized telephone agents used by airlines and hotels as prime examples of these “so-so” technologies. The path toward making the work of the future profitable for businesses and rewarding for customers requires adapting new technologies to improve processes.


Here are four main takeaways from the task force’s report, which provides significant recommendations for shaping the work of the future in a manner that benefits all of society.



Seeing a New Path to Transforming Ophthalmic Care





face shields for medical professionals in desperate need of equipment. As a result, they were able to secure additional backers for the slit lamp shields and, serendipitously, develop renewed interest in Ocular 1 and its telemedical potential. “This destructive fire eliminated everything we had worked so hard to build,” says Sternfield. “But now, we have lots of interest from across the entire industry and new clinical pilots within much bigger networks.” Ocular also received a boost from the MIT $100K Entrepreneurship Competition’s Launch contest in May. Following an impassioned presentation from Sternfield, the team took home the Robert P. Goldberg $100,000 grand prize. D EL STERNFI

Since their debut at the 2019 MIT delta v Demo Day, Ocular Technologies has worked tirelessly to improve Ocular 1—a portable headset capable of automatically administering an eye exam and sending the data to an ophthalmologist for review. However, as co-founder Brett Sternfield, MBA ’20, explains, the startup’s original mission has been revitalized in light of the COVID-19 pandemic. When co-founder Grayson Armstrong, MD, was unable to obtain protective shields for the slit lamps used by ophthalmologists at Massachusetts Eye and Ear, Sternfield got to work. He acquired acrylic from a local vendor, laser cut some slit lamp shields, and donated them to Ocular’s clinical partners. “The only response we got,” he recalls, “was, ‘More! We need more!’” Sternfield and new Ocular team member Zona Liu, MBA ’20, got in touch with MIT researchers who quickly designed mass-producible, protective

Freeing Innovation for the Betterment of All


Eric von Hippel, SM ’68, (T. Wilson [1953] Professor in Management; Professor of Management of Innovation and Engineering Systems) believes that “free” innovations—those developed by people instead of large corporations—do not receive enough support. When the MIT Sloan economist and his colleagues surveyed citizens from six countries, they determined that tens of millions of people were investing their own money in new designs and devices. “It’s traditionally been ignored by economists and policymakers because they don’t sell stuff,” says von Hippel. “Ninety percent of it is entirely outside the economic system.” (For more details see von Hippel’s book Free Innovation, which is also available as a free download.) The invention of a cloud-based continuous glucose monitoring system (CGM) provides a prime example of homegrown entrepreneurship, where individuals—driven by urgent need versus profit—rapidly increased product development. A group of parents of children with type 1 diabetes grew frustrated by the egregiously slow timelines of traditional medical device companies. So, they created Nightscout, a product that provides lifesaving, real-time access to glucose data on smart watches, smartphones, and other devices.

“ This advances social welfare as well as individual welfare. We, as a society, have to figure out the rules for protecting the commons that these people are creating.” ERIC VON HIPPEL


The internet has made communication between like-minded people easier, and computer-aided design tools have enabled fast and low-cost product development in homes worldwide. In many ways, the virtually free innovation paradigm has grown up. It now presents the biggest challenge to long-established patterns of commercial innovation since the Industrial Revolution. Von Hippel and his colleagues believe that this transformation presents new opportunities for enabling the scale necessary to maximize impact. “This advances social welfare as well as individual welfare,” says von Hippel. “We, as a society, have to figure out the rules for protecting the commons that these people are creating.”


The same spirit of rapid entrepreneurship has come into sharp focus during the COVID-19 pandemic. “Thousands of people came out of nowhere and started designing ventilators or masks at a larger scale of development than producer firms could justify,” says von Hippel. “It’s totally fabulous. What I’m doing with colleagues is creating a system to support it.”


A better world i s our business. The MIT Campaign for a Better World has been launched because worldwide we find ourselves at a critical inflection point. Technological, environmental, economic, and demographic trends are converging to present new—and complex—challenges. In the MIT community, complexity is our call to action. By harnessing the collective ingenuity of the school and Institute, we can take on the greatest issues of our time, if given the resources to do so.

The MIT Campaign for a Better World is structured around these crucial global topics: • Discovery Science • Health of the Planet • Human Health • Innovation and Entrepreneurship • Teaching, Learning, and Living • The MIT Core

MIT Sloan Campaign Progress (as of 6/3O/20)




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WHY NOW? AND TO WHAT END? The generosity of alumni and friends like you is what empowers individuals featured in this newsletter to make a better world. With your support, they can create new innovations and accomplish entrepreneurial feats that will impact our lives today—and the lives of generations to come. For every campaign gift is not only a gift to MIT Sloan, but to the world. At a time when we must address immediate needs and emerging opportunities—like the global pandemic and calls for diversity, equity, and inclusion—your help is more necessary than ever. MIT & MIT SLOAN Along with the Institute, MIT Sloan is responsible for raising a portion of the total campaign funds across all groups within MIT. This means we need the help of alumni, colleagues, collaborators, and friends like you in supporting MIT Sloan’s mission. While our aims and goals align with those of the Institute, we are primarily focused on funding those efforts that bring our particular strengths to the campaign— namely, employing management theory and practice to tackle the world’s toughest challenges. Our fundraising is making substantial progress, but we are still in need of your continued support. Please consider making a gift in support of the MIT Campaign for a Better World by contributing to the MIT Sloan Annual Fund or to one of the many important initiatives here at MIT Sloan.

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