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Ikhlaq Sidhu, founding director of the Center for Entrepreneurship and Technology at UC Berkeley discusses Skydeck, the start-up incubator founded by UC Berkeley in part one of this two part series on entrepreneurshipTRANSCRIPTSpeaker 1:Method to the madness is next. Your listening to method to the madness. A biweekly public affairs show on k a l ex Berkeley celebrating bay area innovators. Speaker 2:Okay. Speaker 1:Good afternoon. This is your host, Vanessa Ang. Joining us today is eight o'clock. Did you the founding director of the Center for Entrepreneurship and technology at UC Berkeley. [00:00:30] Today we'll explore the founding of Skydeck, a startup incubator at UC Berkeley. We'll also discuss the Berkeley method of entrepreneurship. Thank you for joining us today at Glock. So what is skydeck give us some background history. Speaker 3:Okay. All right. I'm happy to, uh, fill you in on the history and talk about other things as well. So, um, I, I should say first of all that, um, [00:01:00] uh, I'm the academic director for the Center for Entrepreneurship and technology and this is something that we started in 2005 out of the College of Engineering. It's almost been 10 years since we started it. And it's mission includes some things that, um, that Skydeck, um, has grown into. So a little bit of a understanding of both might be relevant, the mission of the Center for entrepreneurship. And Technology is pretty [00:01:30] much what you would think. It's to educate and probably more more so engineers and scientists, but really all students on the Berkeley campus, how to innovate, how to productize, how to commercialize technology and have a perspective in a global economy. And we have many students, um, probably about a thousand students a year that take classes in topics that are related to this, about three years into the development of the center. Speaker 3:[00:02:00] One of the things that we started to do was not only have classroom activity but also to have incubation or to um, have a place and even some words and connections to venture capitalists and to the relevant people and stakeholders for, um, for actually growing ventures. And so, uh, we started that sometime back that's probably around the 2007 or 2008 [00:02:30] timeframe. And we had amazing success with the few teams that we would pick either out of our classes or across the campus in general. Almost a half of those teams would grow up and become, um, self-standing ventures. And now we are very careful in selecting. But out of that small set, we had a lot of success. And out of that model we realized, um, collectively on the campus that [00:03:00] uh, acceleration is really an important thing. It's not only something that you teach in classes but you, you do this in real life. And skydeck came just a little bit after these experiments that happened and Skydeck is now the 10,000 square feet of acceleration space that's on the top floor of 2150. Shaddock. It's in downtown Berkeley. There's about 20 plus teams, uh, new ventures [00:03:30] that are incubating and being accelerated on that floor. And that's really what skydeck is. It's the combination of the education and the research and we see it in these early startup companies that, um, show or almost highlight the creativity of the students enough. The research that comes out of this institution. Speaker 1:So are the teams that are being incubated by a skydeck composed primarily of Berkeley students. [00:04:00] The teams Speaker 3:are in Skydeck are a mix of Berkeley students who have taken classes in various entrepreneurial programs and they have gotten to the stage where are more polished and ready to be accelerated. And also teams of graduate students or graduate students and faculty that have incubated their early ideas within research projects [00:04:30] that go on on the campus. And they have also gotten to a stage where the story and the narrative and the, um, the work that they're doing is ready to be commercialized. So it's about, it's a research output and it's a, um, a curriculum output that, that results in these students. One other thing if I can, uh, just add that is that skydeck is a collaboration of [00:05:00] the College of Engineering, of the hospice school and of the vice chancellor of research. Uh, so, um, it's really all of these communities that come together and, and make skydeck the accelerator that it is, Speaker 1:it's quite interesting for a university to help fund and found its own incubator. Could you tell us about what you see as the relation between academic research and the commercialization of that research? Speaker 3:So it's not that this [00:05:30] is completely a unique idea in academics, but you know what's causing the need for it, not just at Berkeley but you know, all across the country and in fact all over the world is that there's a category of research which is fundamental knowledge creation. It's over long periods of time that um, that the understanding is, is used and it's a very important part of research. It's, it's theoretical and fundamental, [00:06:00] but there's also research which is applied and um, the applications of that research are more valuable when they are seen, when people understand what they are when they are used. And the idea by itself doesn't reach people or it doesn't scale without investment dollars and without customers who, who value it. And without the research being adjusted [00:06:30] in a way that people can use it. And that's really part of what commercialization is about. So one to have visibility of all of the amazing work that goes on on this campus. That's one very important reason to, to have an activity like skydeck and more than the visibility is the actual good that this work does when it gets placed in a commercial setting. Speaker 1:Do you find that the impetus to scale [00:07:00] and to commercialize then pushes the research that students do in unexpected directions? Speaker 3:Yeah, that's an interesting question. I think Berkeley has been a place a has a history of, I'm going to say diversity, diversity in thought, diversity in ideas. And I think there's a place for um, there's a very large place for theoretical and fundamental work, but um, the state of California and the people in California are also interested in those aspects of their [00:07:30] research, which make peoples lives better, which have societal value, which they can buy to save time or to entertain people in different ways. And that's also an important part. And so I think there's a balance. I don't think one is right, but certainly I don't think it's exclusive that work should be in one category or the other. Speaker 1:What happens afterwards for people who go through all the programs run by the Center for entrepreneurship, it's been quite some years. You know, I think by now we must have [00:08:00] like four or 5,000 alumni that have, Speaker 3:you know, come through our programs and many have started companies and, and they run these companies independently, right? But there's a lot of people that, you know, go through the programs and they have a learning experience and they go to work somewhere and they do well. And so by now a lot of these, you know, many of our alumni are well placed in very good companies or the little company that they started got acquired by [00:08:30] a bigger company and now they've done well in that larger company. And so we have alumni who are executives, I guess is maybe the right word as well as entrepreneurs in the bay area. I'll tell you this one story from venture lab sometime back, which is we had these undergraduate students and they had an iPad application and stood up on the stage and presented it and everyone was like, wow, that's really cool. Speaker 3:I mean, [00:09:00] they did a great job in just their few minutes. And right after that, um, not more than a month, maybe, maybe two months or something like that. They came back into my office and they said, well, you know what, um, I think we want to, um, drop out of school. And you know, my first question is have you talked to your parents about this? And they explained that since that time they had, you know, a million or more dollars of funding for their, uh, for their project. [00:09:30] And there was another little caveat that they had spending so much time on this that they let all their classes suffer. And you know, if they continued with the semester, they would have basically gotten bad grades and in all of these things. And they had gone and they'd done some research and they figured out that if they drop here, there is a way for them to get back into school. Speaker 3:A year later. It's not really like ending, but they could actually take a break of a sore is what it is and do this experiment. And they had, you know, a relatively large [00:10:00] amount of money that they could, could build our company with. So I'm like, so listen, as a person who teaches these classes, silver, I cannot tell you that you shouldn't drop out of school. That's just beyond what I'm like allowed to say here. But, uh, you know, whatever you decide to do, talk to your parents, talk to administration to just know what you're doing. It's, you know, it's really up to you to, to decide what you want to do. But as I internalizes and I think about this, what they are about to do is [00:10:30] take this money and run this company and they're going to be the CTO and the CEO and so forth of this company. Speaker 3:And you can bet that that next job that they're going to apply for one day is a lot better after having done whatever they're about to do for the next year than it would be if they took one more class in what they were doing. So again, like I would never say like, oh, you should do that. That would be really outside of the kind of advice [00:11:00] that, that I can give. But as I think about it, they did very well. I mean, and I don't know, you know, what exactly happened and how many pivots they had and what that translated into. But they had great skills by going through this process. They had just amazingly great skills and I have no doubt that they'll be successful no matter which way they go. So there's a balance to, to this, uh, conversation. And for some people, pursuing their entrepreneurial dream is, is a great [00:11:30] opportunity. Speaker 3:But let me give you the other side to that story. So for all of the people who say, Hey, just join a venture, you'll learn while you're here and why do you want to spend your time in this classroom, in that classroom? And you know, you could get paid to learn. That's the kind of argument that you hear on that side. You know what I'll tell you is that all of these companies that grow and are, you know, there's one bill gates and there's one, there's, you know, and there's war one mark Zuckerberg. And [00:12:00] so forth. And yes, they came out of school and they built some enormous and and great organizations, but all those organizations who are they hiring, they want to hire people who finish school. You know, in the end a company is not just a few entrepreneurs who we'll take that challenge and will not bother about all these conventions. You need certain specializations. It doesn't matter how entrepreneurial you are, you cannot be a doctor because you're entrepreneurial. [00:12:30] It no one's going to let you operate on them just because you think you can. And when organizations need to hire people, they need to hire people with exact skills to do accounting right, and to not mess up the taxes when they filed them and to do everything that the company needs to do. Speaker 1:You're listening to method to the madness on KALX Berkeley. Today we have a clock Stud, you the founding director of the Center for Entrepreneurship and technology at UC Berkeley. He's here to speak to us today about skydeck [00:13:00] and the Berkeley method of entrepreneurship. You're very involved with the Berkeley method of entrepreneurship here at cal. Could you tell us more about this method? Speaker 3:Yeah, so first I should say that, um, the Berkeley method of entrepreneurship is a, um, is a teaching methodology. It's a holistic approach to helping people become entrepreneurs or teaching them how they can be entrepreneurs. And it was developed by myself and with, um, my [00:13:30] co-director, the managing director of the center, Ken Singer. And in many ways, it's has been developed over many years. So we've been teaching people how to become entrepreneurs or, yeah, basically how to become entrepreneurs in our classes for, as I said, you know, almost 10 years now and we've had a number of experiments, some things work well and some things don't work as well. And we've learned over this period of time, well in the last few years we've come to the state where we [00:14:00] can codify it, we can explain what has worked well and what has not worked well better than say we could have five years ago. Speaker 3:And so now when I think about teaching people to be entrepreneurs, I think that there's three types of support or knowledge that we can give them. And one of these types of support is the types of things that you would read in, uh, various entrepreneurship books that can be books that are about lean launch [00:14:30] or ideas like pivots or milestone based planning or how you work out the mechanics of a venture term sheets or you know, all of those types of ideas, um, that are more or less expressed in, in the process of how you, you start companies and are in books. I think that's one category of things. And quite often in classes, that's what people teach. There's another thing in skydeck. So a great example of the infrastructure that you [00:15:00] have to provide to allow entrepreneurship to happen. So that is both space and clear rules on intellectual property and the networks of investors in the way that you can connect to mentors and angel investors and to first customers and all of that kind of infrastructure that, that, um, incubators and accelerators can provide. Speaker 3:But quite often there, there's this missing piece and the missing piece is what's going on [00:15:30] in people's heads. It's their mindset. And, um, mindset is, is basically, um, in part it's the way that you see things and it's a certain set of beliefs that you have and that results in different behaviors that you take. So a person with an entrepreneurial mindset can look at a certain situation and they will act in a way that will lead them to pursue something [00:16:00] entrepreneurial. Whereas someone with without that mindset will look exactly at the same situation and they may just want to be as far away from that situation as possible. They don't see that as an opportunity. These, they see this is something that's not interesting to them. And by seeing things in certain ways, you behave in different ways and entrepreneurs tend to have certain set of behaviors and when entrepreneurs [00:16:30] are in a community and they're sharing this mindset with each other, they, that's what an entrepreneurial culture is. Speaker 3:And Bay area of course has a very strong entrepreneurial culture and learning the entrepreneurial culture, these unwritten rules of how you proceed and go about and work with other people. That's a really important part of being an entrepreneur. And so we're, we're combining all three of these layers together in our approach to teaching [00:17:00] it. Uh, just explain what some of these behaviors are. Um, that would be a natural question. I, I would think probably the most obvious one is how resilient people are to certain situations. So, um, how resilient are you to when people say no to you for something? Um, some people take it much harder or they, they would not want to ask for something if they thought that there's even a chance. The answer might be no. But entrepreneurs have to ask for things [00:17:30] where the answer is no all the time. And um, they can't take that hard at all. Speaker 3:In fact, they have to realize that after someone says no to you, nothing bad actually happened. It's fine. It's like, okay, that's, you know, they might want to ask a followup question like, why not? But nothing bad is actually happening by asking for something where the answer is no. Or sometimes when things don't go right, you know, how resilient are you to it to effectively the failure and do you look at it that way? [00:18:00] But there's more than, than only resilience and, and accepting of experiments that fail and so forth in entrepreneurial culture. Uh, one is how quickly you trust people. If you can trust people quickly and you can share information quickly, you're likely to get feedback much faster than other people. And so your ideas evolve faster. Another is how you negotiate with people. Do you negotiate zero sum, uh, meaning that anything [00:18:30] that you think you can get in the negotiation is something that they are gonna give up or lose? Speaker 3:Or do you negotiate for the longterm really to try to get fairness for both sides? You know, people who negotiate for the short term, they can't count on these people and this help, um, the next time around, or even a little while later on, and as soon as the situation turns in the favor that the other person has a little bit more capability [00:19:00] or resource or power, uh, that person's no longer helpful to them. And so learning to negotiate in a way that is a creative that, that you know, that lets people turn one plus one into three. You know, that type of negotiation is very common with entrepreneurs. Very important for entrepreneurs on a cultural entrepreneurial culture basis is the diversity of networks that they are part of. So it turns out, and you [00:19:30] can, you can think this through logically, that people who are very similar with each other just don't have that much to trade with each other. Speaker 3:So if you're given a job and you're both completely the same, maybe you can do the job in half the time that that's, that's fine. But if you're trying to create value, usually one person brings one thing and another person brings another thing and then now they can trade their skills with each other and they can accomplish more than they could have when they were just one [00:20:00] person. So if you buy into the idea that value comes from diversity of the people that are working together, um, the problem is that the people that you're most naturally wanting to talk to and spend time with are the people that are the most similar to you. So you have to overcome your social barriers to want to spend time with people that are not like you. And you have to be in networks of people who are different [00:20:30] than you. Speaker 3:And that's very common for entrepreneurs, that they are able to overcome these networks quite easily and so forth. So we have a list of 10 of these types of behaviors that entrepreneurs have and we infused that into our teaching models so that we're not only teaching, how do you, um, negotiate a term sheet, but we're teaching these very fundamental, um, behaviors that are much more likely [00:21:00] to make you a successful entrepreneur. Do you think an entrepreneur can really be made? Yeah, I actually think you can make an entrepreneur. I do. And I can almost say that the research, uh, verifies that I don't want to make too strong a statement on that. Just because you never know how that will come back to you. But what we've discovered is that entrepreneurs are the only group of people among three sets of people. Entrepreneur, innovator, manager and [00:21:30] engineer with took those three sets and we discovered that entrepreneurs were the only ones that continued to be comfortable and became more comfortable over time outside of their comfort zone and everybody else after high school regresses just a little bit with how comfortable they are outside of their current comfort with ambiguity. Speaker 3:That means comfort with deciding [00:22:00] to that you will do something even though you don't know what the outcome is going to be. And so if you put these two ideas together that you can only grow when you're comfortable being outside your comfort zone and the fact that entrepreneurs are the one category of people that continue to, to be comfortable outside their comfort zone and the fact that a growth mindset can be taught, it's proven, it's, it's [00:22:30] shown that it has to do with the reinforcement of you know, what, what you get reinforced for. So we feel strongly that you can be reinforced for behaviors that would let you stay outside of your comfort zone and that you could therefore create more entrepreneurs. Not sure it means that every single person can be an entrepreneur, but we can train people in such a way that they're all more [00:23:00] likely to be an entrepreneur. Speaker 3:And there's also other issues that just because you can be an entrepreneur doesn't mean that you want to. And so you have to personally decide that that's what you want to do, which is separate from your [inaudible] capabilities. What are some of the training practices or specific exercises that you have students do to gain this new mindset or gain entrepreneurial capabilities? So we actually use games and exercises built into our courses, uh, to, to reinforce these types of behaviors. An example [00:23:30] that, you know, you could start to understand, let's go back to the, uh, getting comfortable with people saying no to you. So we have our students go out in little groups and one of them, um, uh, uses their cell phone and um, video tapes basically, and the other person walks up to a complete stranger, a person they don't know and ask them for something unreasonable where the answer is very likely to be no. Speaker 3:And they, [00:24:00] uh, make them ask the question and they get them on, on the video and they submit the video. That's their homework. And so people will, will ask for crazy things. Occasionally the person will even say yes. And that happens too. And so there are certain situations I guess where they didn't realize that that wasn't completely as unreasonable as as they thought. So that's one on the resilience side, but there's things that you can do in how you tell stories or [00:24:30] you know, how you communicate with other people and how, how easily did they understand what it was that you are communicating there. There's a number of games basically. And the watching yourself is an important aspect of that because not only do you have to go through the game, but then when you see what you look like trying to do that thing, um, that's part of the learning and that helps you overcome it. Speaker 3:I was wondering if we could now shift gears and talk [00:25:00] a little bit about you. Could you tell us a little about your background and how you came to Berkeley? Um, all right. So I, uh, have three degrees in electrical engineering through phd. I spent almost 10 years running advanced development or large portions of advanced development and used to run about a third of the advanced development for three home corporation. Uh, I was a chief technical officer for three g wireless infrastructure company [00:25:30] and in 2002 I came back into academics and I was a visiting professor at University of Illinois and I started the entrepreneurship program or grew the entrepreneurship program there in Champagne, Illinois. And in 2005 I was contacted did by Berkeley. And in fact, the dean at that time, Richard Newton, he said, well, you know, if you can start an entrepreneurship program in Illinois, you should really [00:26:00] be able to start one in the bay area at Berkeley. Speaker 3:That seemed to make some sense to me. So in 2005, I came here, I've a appointment in industrial engineering and operations research. I, um, my first role here was really to create this, uh, entrepreneurship center at Berkeley. And um, along the way created a number of other things. One was this venture lab, uh, one is that a Richard Niton distinguished innovator lecture series. [00:26:30] One is, uh, I read the proposal for the fucking Institute for Engineering Leadership and uh, became the founding chief scientist of this institute. And I'm probably just a number of other related activities to, to entrepreneurship and innovation. Speaker 1:I was wondering if there were any childhood inspirations or life experiences that set you on this path. Speaker 3:For some reason I had a very early and natural interest [00:27:00] to build things when, when I was small. Um, I used to, um, um, you know, I mean starting out with the simple things, but by fifth or sixth grade, I was building some sort of photography laboratory and then I built a dark room timer out of parts from, um, radio shack and I was building my own clock. By ninth grade. I had built a method or some machinery to [00:27:30] transmit sound over optical pulses so that you could play a tape recorder, they had tape recorders and it would go into a little laser and would be received on the other end. If you put your hand in between the receiver and the transmitter, the sound would stop and he'd take your hand away and it would continue on. Uh, so, you know, it was digital pulse code modulation and I brought that in and basically like the first day of science class in ninth grade. And you know, the teacher was just like, well, I guess, um, [00:28:00] I guess, you know, like way ahead of everybody here. So somehow I just knew that I wanted to do things in engineering. Speaker 1:I was also wondering what made you want to get more involved in academia after your time in industry? Speaker 3:First of all, I probably spend, you know, 10 plus years or something in school. So a a significant amount of time getting my phd and being trained in that way. And then I spent probably an equal amount of time in industry and you know, both [00:28:30] building product and developing intellectual property and so forth that I have 61 patents actually that were developed, you know, during that period of time. And while I was in industry I couldn't help but notice that there were a lot of things that just weren't taught in school. And if only I had known some of those things, it would make my industry life more effective, more productive and so forth. So for me, it's really [00:29:00] full circle, which is that when the opportunity came to then spend the next set of years back in academic setting, the motivation was that I could bring back the experiences that I had had both in larger companies and as in an entrepreneurial environment and in the new venture back into the academics. And that's why the entrepreneurship center actually just made so much sense for me. And ultimately that's the value and that's also the [00:29:30] kind of reward that I get from the study of these things and the teaching of these things. Speaker 1:Now, have any of our listeners has questions or comments? How can they get touch with you? Speaker 3:I think that the first thing is you should look at our website, c e T. Dot. berkeley.edu and of course the skydeck website as well. And, um, I have to say that I'm probably pretty easy to find. You could easily Google me. Thank you for joining [00:30:00] us today on method to the madness at Gluck. It's been a pleasure. Speaker 4:If you have questions or comments about this show, go to the k a l x website and find method to the madness. Drop us an email, tune in again in two weeks at this same time. Have a great weekend. See acast.com/privacy for privacy and opt-out information.
Opening Remarks Ikhlaq Sidhu, Professor, Industrial Engineering & Operations Research and Director, Center for Entrepreneurship & Technology Shankar Sastry, Dean of the College of Engineering Lesa Mitchell, Vice President, Ewing Marion Kauffman Foundation Session 1: Energy and Technology Moderator: Todd Woody, Senior Editor, Fortune Magazine author of the Green Wombat Blog Oil Independence via Sustainable Mobility Shai Agassi, Founder and CEO, Better Place Thermoelectrics for Efficient Energy Arunava Majumdar, Professor, Mechanical Engineering and Materials Science and Engineering, University of California, Berkeley Affordable Zero Energy Home Tom Siebel, Chairman, First Virtual Group
Opening Remarks Ikhlaq Sidhu, Professor, Industrial Engineering & Operations Research and Director, Center for Entrepreneurship & Technology Shankar Sastry, Dean of the College of Engineering Lesa Mitchell, Vice President, Ewing Marion Kauffman Foundation Session 1: Energy and Technology Moderator: Todd Woody, Senior Editor, Fortune Magazine author of the Green Wombat Blog Oil Independence via Sustainable Mobility Shai Agassi, Founder and CEO, Better Place Thermoelectrics for Efficient Energy Arunava Majumdar, Professor, Mechanical Engineering and Materials Science and Engineering, University of California, Berkeley Affordable Zero Energy Home Tom Siebel, Chairman, First Virtual Group