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1. Created in Denmark Strategies for Innovation Jimmy Maymann CEO, The Huffington Post 2.

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Presentation on theme: "1. Created in Denmark Strategies for Innovation Jimmy Maymann CEO, The Huffington Post 2."— Presentation transcript:

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2 Created in Denmark Strategies for Innovation Jimmy Maymann CEO, The Huffington Post 2

3 AGENDA Introduction The Macro Story The Micro Story The HuffPost Story Closing Thoughts INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY 3

4 What makes the difference between entrepreneurial success and failure? Ability to Scale, Cultural Perceptions, Influx of Different Mindset/Foreign Talen INTRODUCTION 4 THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Which forces contribute to higher productivity? Business Culture, Government Policy, Collaboration, Talent Pools How can Denmark catalyze the same kind of entrepreneurial activity? Better understand entrepreneurs’ needs, change cultural perception of entrepreneurs, encourage collaboration How is HuffPost changing the traditional media landscape? HuffPost being disruptive in media industry

5 The Macro Story Denmark CAGR: 5.48% United States CAGR: 4.86% United Kingdom CAGR: 5.07% Israel CAGR: 6.07% 5 1 Source: World Bank Denmark’s GDP growth is strong compared to three economies where entrepreneurs are likely to start new businesses: US, UK, and Israel INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY

6 6 GDP growth is only a snapshot of how Denmark is performing today. The “new economy” of Denmark will be shaped by these factors: INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY The Macro Story 1.Entrepreneurial Activity 2. High Tech Contribution to GDP 3. Government Contribution to Private R&D

7 7 Entrepreneurial Activity While new businesses have significantly contributed to growth in other economies, only 5% of Denmark’s adult population is involved in early-stage entrepreneurial activity, as opposed to 13% in the US. % of Early Stage Entrepreneurial Activity Amongst Adult Population 2 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Denmark 2012: 5.40% United States 2012: 12.8% United Kingdom 2012: 9.00% Israel 2012: 6.50% 2 Source: GEM Consortium The Macro Story

8 8 Contribution of High Tech Sector to Total Exports (2009) 3 0.6% 1.6% 2.0% 3.3% High Tech Contribution to GDP In Denmark, the high tech sector contributes to 0.6% of all exports, despite the fact that Denmark is the 6 th most high tech R&D intensive country in the world. 4 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY 3 Source: OECD 4 Source: Bloomberg The Macro Story

9 9 Composition of Domestic Enterprise R&D Expenditures (2009) 5 Government Investment in R&D Denmark invests relatively less in private sector R&D. The US and UK governments have heavily invested in private enterprise R&D. Israel’s investment is still relatively higher, but it reached a peak of 11% during the 1990s. 2.58% 4.67% 14.01% 7.89% Source: OECD Public FundingPrivate Funding INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY 5 Source: OECD The Macro Story

10 Building the worlds leading teen story telling platform Social network to connect, collaborate & share Tools to develop stories (words, video & images) Competitions based on current trends (fan fic) SERVICE BUSINESS Commercial story rights - books, games & film Premium services for users Educational services PROGRESS 2011 (Dec): 10K users 5K “Movellas” 277K reads 100% web 2012 (Dec): 70K users 40K “Movellas” 2.6M reads 75% mobile 2014 (outlook): 1M users 90% mobile $100M

11 How can Denmark position itself to remain competitive in the future by catalyzing new business growth in other sectors today? 11 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Clusters of Innovation

12 The United States, UK, and Israel have seen substantial success in cultivating clusters of innovation. 12 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Clusters of Innovation United States: Silicon Valley Considered to be the most well-developed start-up ecosystem in the world, with over 25 startups that are valued at greater than $1 billion. The Silicon Valley ecosystem – with its high concentration of universities, venture funding, talent, and entrepreneurial talent – increase the likelihood of successful startups United Kingdom: Silicon Roundabout UK’s high tech presence surged after the 2008 recession due to efforts by the government to actively accelerate the formation of companies in the area. The Silicon Roundabout has a high concentration of companies in communications and digital media. Israel: Silicon Wadi Israel is an excellent startup ecosystem due to a healthy funnel of startups across the developmental lifecycle, a developed funding ecosystem, a strong entrepreneurial culture, and a strong supply of talent.

13 13 US UK Israel Talent PolicyCollaboration Culture Denmark INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Weak Moderate Strong In recent years, Israel has systematically created the right environment for innovation Clusters of Innovation

14 14 Case Study: Israel Israel’s incubator program brings public, private, and academic institutions together with entrepreneurs. 1 Entrepreneur has an idea and applies to an incubator, based on the sector of the proposed business. 2 Entrepreneur gets training from industry experts and venture capital fund managers. 3 Entrepreneur pitches idea to government and to fund managers. 4 Israel’s government contributes up to $600,000 USD. Rest of funding comes from VC. INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY

15 15 Case Study: Israel Licensing Universities from which ideas come can earn royalties on the business once it generates revenue Privatized System was privatized after 10 years, to ensure that growth is organic and profit-oriented Profit Driven Seed funding from non- government entities keeps the focus on profits INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Israel’s system is inherently profit-driven rather than developmental, translating to productivity.

16 16 Policy % of GDP Spent on R&D (2010) 7 Israel4.46% United States2.90% United Kingdom1.86% Denmark3.06% Culture Every 18 year old in Israel must join the Israeli Defense Force, a tradition that builds business acumen and business relationships amongst young adults. INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Nicknamed “Start Up Nation”, Israel’s innovation policies and culture are conducive to entrepreneurship. Israel is the world’s top-spending country on research and development. 7 Source: World Bank Case Study: Israel

17 The Micro Story 17 Entrepreneurs have a means-oriented mindset while executives have a goal-oriented mindset. Manager/Executive sees means and figures out whether they can achieve or define a specific goal. Entrepreneur sees goal and wonders how he can reconfigure the means. Culturally, the Danish are more attuned to the Manager/Executive mindset, because of a fear of failure that continues to inhibit citizens from wanting to start a business. INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Goal Oriented Means Oriented

18 INTRODUCTION THE MACRO STORY THE HUFFPOST STORY CLOSING THOUGHTS THE MICRO STORY 18 Historically, US has had the fewest proportion of adults discouraged to start a business due to fear of failure – Danish entrepreneurs could potentially learn to be less risk averse Percent of adults who perceive entrepreneurship opportunities but cite fear of failure would prevent them from starting a business Source: GEM Consortium The Micro Story

19 INTRODUCTION THE MACRO STORY THE HUFFPOST STORY CLOSING THOUGHTS THE MICRO STORY 19 9 Source: United States Bureau of Labor Statistics 10 Source: Kauffman Foundation Entrepreneurship and Unemployment Rates in the US (1996 – 2009) Recessions can make people less risk averse and catalyze entrepreneurship In the United States, the unemployment rate increased significantly after the 2008 financial crisis – but so did the rate that people founded new businesses 9 10 The Micro Story

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21 Source: PCGAPCGA

22 INTRODUCTION THE MACRO STORY THE HUFFPOST STORY CLOSING THOUGHTS THE MICRO STORY 22 Entrepreneurs are distinct from small business owners in that, from the very beginning, they intend for their businesses to scale SALES (DEMAND) TIME DISCOVERY VALIDATION EFFICIENCY SCALE DISCOVERY – Idea is born and tested. VALIDATION – Idea is spread to potential customers. SCALE – Aggressive growth of idea and company EFFICIENCY – Business model refined and tested. In Denmark Denmark’s present income tax structure may discourage entrepreneurs and investors. 9 Danish entrepreneurs currently wait too long to merge or be acquired, but this is often needed in order to scale their businesses Source: The Economist 12 Source: Danish Business Authority The Micro Story

23 The Huffington Post Story HuffPost combines an award-winning newsroom with coverage across a broad variety of content 23 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY LIFESTYLE ENTERTAINMENT NEWS & BUSINESS TECH & INNOVATION editors and reporters + 50k bloggers

24 The Huffington Post Story The Huffington Post is a global, cross-platform experience reaching more than 71M users 24 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY CORE SITELIVE STREAMING VIDEOMOBILE

25 The Huffington Post 25 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY 58 SEC A NEW PIECE OF CONTENT IS PUBLISHED GLOBALLY STORIES EACH DAY EVERY 500 REPORTERS AND EDITORS CONTENT + CONVERSATION The sheer scale of our operation drives impact by connecting editorial to the social landscape in real-time

26 The Huffington Post The Huffington Post’s digitally native culture has driven its exponential growth 26 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Digitally Native Culture No print history – no legacy ways of thinking “Winning the internet” is the mantra – the goal is to be everywhere Editorial and Tech co-create new products and innovations Social media at the heart of every HuffPost employee Data-driven culture at every level Monthly Visitors (Global) MM 50 MM 100 MM Source: Google Analytics

27 What Denmark Can Learn 27 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Strengths 1.Human Capital – create a pipeline for entrepreneurial talent, and bring in more foreign talent 2.Incubators – learn from the experience of incubators in US, UK, and Israel to build more robust, scalable businesses Strengths 1.Human Capital – create a pipeline for entrepreneurial talent, and bring in more foreign talent 2.Incubators – learn from the experience of incubators in US, UK, and Israel to build more robust, scalable businesses Opportunities 1.Corporate Tax System – evaluate income and capital gains taxes to encourage more investors 2.Entrepreneurial culture – cultivate a culture of higher risk tolerance and willingness to experiment 3.More R&D investment – increase domestic R&D investments Opportunities 1.Corporate Tax System – evaluate income and capital gains taxes to encourage more investors 2.Entrepreneurial culture – cultivate a culture of higher risk tolerance and willingness to experiment 3.More R&D investment – increase domestic R&D investments

28 What Denmark Can Learn 28 INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY Lower Income Tax Lower Capital Gains Tax Import Talent Cross-sector Collaboration Increase R&D Investments Optimize Incubators Promote risk- seeking, entrepreneurial culture ++++ Short term Long term + Promote private sector funding Talent pipeline from universities to startups ++

29 29 Tak! INTRODUCTION THE MACRO STORY THE MICRO STORY CLOSING THOUGHTS THE HUFFPOST STORY


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