Except, of course, this view is no longer valid.

Yes, Latin America struggles with these problems but to a far lesser degree than we may think. And, in fact, Latin America is both more economically significant and more developed both in terms of markets and societies than we may realize.

These are the key arguments presented in a Spanish book called “Nuestra Hora: Los Latinoamericanos en el Siglo XXI,” or “Our Time: Latin Americans in the 21st Century,” written by Chilean entrepreneur Raul Rivera Andueza. According to Rivera, of the 600 million people living in the region, nearly 400 million are in the global middle class. He also writes that their ranks are growing by 5 million per year and that Latin America’s median income is about $10,000 per year — far higher than median incomes in many other developing regions. I visited Brazil and Chile in April. In both countries, I glimpsed firsthand the economic revolution Rivera writes about. Here’s the upshot: The economies of Latin America now boast a collective — and impressive — GDP of $5 trillion.

Latin America is also home to some of the most dynamic, large companies in the world. Cemex, founded in Mexico in 1906, has fleets of trucks, which receive signals from satellites to run cement deliveries. The system is driven by sophisticated logistics software. Petrobras, based in Brazil, has gained renown as an oil exploration and refining company tapping modern seismic and structural engineering technology to find huge reservoirs beneath layers of salt miles below the ocean surface. These salt barriers had stymied petroleum engineers for decades before Petrobras and other exploration pioneers figured out how to peer through the salt and then secure drilling rigs and pipes in this shifting salt layer. Then there’s Embraer, the Brazilian aerospace company, which deploys advanced avionics and fly-by-wire technology.

What I saw on my trip, too, was the emergence of Silicon Valley-like startup cultures that have a homegrown flavor and ethos. Startups are being launched in Chile, Argentina, Brazil and Mexico to create the same Internet niches as companies in the United States and Europe. Argentina-based Ombushop, for example, aims to simplify the building and launch of an online store. This is a niche that Shopify, in Canada, has popularized and in which Amazon also has a large presence. Ombushop aims to achieve the same success in Latin America. Hadza, in Chile, is developing a platform that allows viewers to enjoy simultaneous synchronized video sharing experiences. This taps into the online gaming dynamic and the impulse to share experiences. These are just two of the hundreds of startups with global reach that have launched in Latin America.

Even more intriguing, efforts to bring additional tech talent down to the region appear to be working well. Start-Up Chile, an innovation experiment that I helped develop, offers tech startups incentives to locate in that country and has pulled in some marquee companies, such as real-time crowd-sourced translation service Babelverse. A high-profile startup that recently won a bake-off at Europe’s LeWeb Startup Competition, Babelverse took advantage of the Start-Up Chile program to extend its runway, reduce its burn and take advantage of a more favorable regulatory and legal climate.

All of this paints a more nuanced picture of Latin America. Yes, the region faces tremendous problems. Yes, it is resource rich due to large amounts of arable land and mineral wealth. But Latin America is rapidly expanding in a way that, I predict, will allow it to quickly outgrow many of its problems and to deliver a Western-style middle class to many more of its citizens. This is what Rivera Andueza writes about in his book. The global economic pie is growing far faster in Buenos Aires, Santiago, Bogota, and Sao Paulo than many of us in the West realize. And the sooner we start to view Latin America as an economic equal and one of the richest markets in the world, the faster we in the U.S. can learn from the advances of our cousins to the South. Latin America matters and it will matter even more as the U.S. looks for sources of growth and receptive markets outside of its borders.

© The Washington Post Company

Link to article on Washington Posts website

These were just a few of the arguments from opponents of a government program I helped create in 2010 to boost local entrepreneurship in Chile. The program, called Start-Up Chile, seemed crazy at the time. Give $40,000 to startups led by foreign entrepreneurs to move and set up shop in one of the most magnificent countries on this planet for six months—no strings attached. The government would also provide free office space, help them settle in, and connect them to investors and mentors.

The bet? That foreigners would create a mini-Silicon Valley by bringing fresh ideas and providing locals with connections and encouragement to take risks. No experiment like this had ever been tried before. The common recipe for building a regional innovation hub is to construct a science park next to a research university and provide lavish tax breaks to industry and investors to locate there. The trouble is, none of the hundreds of these top-down efforts anywhere in the world—including the handful in Chile—have produced the promised results.

But Start-Up Chile has exceeded expectations. The biggest concern about the program was that no entrepreneurs, other than those from poorer Latin American countries, would want to move their startups to a remote place like Chile. To date, Start-Up Chile has received more than 1,600 applications from 70 countries, with the most coming from the U.S. Nearly 500 entrepreneurs have participated in the program and there are now 220 foreign startups in Chile that employ 180 locals and 143 abroad. The first batches of foreign startups have raised $8 million in venture capital financing from firms in Argentina, Brazil, France, the U.S., and Uruguay.

Most important, Silicon Valley-style entrepreneurship has been spreading in and around the South American country. The events I saw during my last two trips to Chile were at least as dynamic as those that happen in the Valley every night. The entrepreneurs had organized themselves into tribes to share their knowledge with locals on diverse topics, from biotech to social media. Participants were sharing product ideas and business plans and building networks. Many told me that they had never imagined they could get this type of assistance and were considering starting companies.

Kauffman Foundation Vice President of Innovation Lesa Mitchell, who is researching the program, recently told me it’s a unique model other regions of the world should emulate. She has been advising leaders from more than two dozen countries, from Australia to Venezuela, on how to replicate the model.

Of course, locals did complain loudly—not because the program had fulfilled their fears, but because they weren’t part of it. Chilean entrepreneurs saw tremendous value in having access to global networks and in the knowledge they could gain. They demanded to be part of the action. So in July 2011, the government opened the program to them, waded through a flood of 600 applications, and selected 80 to participate. Now, with an annual budget of about $15 million per year, Start-Up Chile has convinced me it will keep replicating the magic that happens when you focus on nurturing people rather than industry.

The App Economy, to date, has largely touched the lives of those living in the developed world. This is due, in part, to the high cost of smart phones but also because app development has lacked real vision and purpose. I have found that Silicon Valley, generally speaking, doesn’t build apps to save the world or lift people out of poverty. It builds them to sell Angry Bird t-shirts and generate lots of virtual currency.

The folks at Centro de Innovación in Santiago, Chile, aim to change that.

I met Julian Ugarte, an Industrial designer, and his team during a recent trip to South America, and I was blown away by what they are trying to do. On March 22, Ugarte and Centro de Innovación launched a contest with Movistar — a mobile subsidiary of Telefonica — and TechoLab, a non-profit subsidiary of Un Techo para mi País (UTPMP) — a pan-Latin American NGO that dispatches youth volunteers on projects to eradicate the extreme poverty that affects tens of millions in Latin America. A $10,000 prize will be given to each of the creators of the best three apps that address problems facing the millions of people living at the bottom of the pyramid (BoP).

The UTPMP builds houses, provides clean water, and gives the poor tools and technologies to improve their lot in life. UTPMP executive director Javier Zulueta told me that his team, with the help of more than 400,000 volunteers, had constructed 78,000 transitional houses in Latin America and completed numerous other anti-poverty projects. An important aspect of these projects is that the volunteers seek to include the poor in the development process by encouraging them to contribute to and guide the projects benefiting their communities. In other words, UTPMP seeks not only to give them a fish but also a fish hook and pole, metaphorically speaking, to become more self-sufficient.

Zulueta said that UTPMP had inaugurated Centro de Innovación three years ago, to develop innovative new products, services and business for those most in need. Here’s the rub. The Center seeks to do this by treating these impoverished households as customers of real economic value rather than as charity cases needing a handout.

Last year, Ugarte’s team partnered with Alfredo Zolezzi, Chief Innovation Officer of Chile Advanced Innovation Center, to test a revolutionary pint-sized Plasma Water Sanitation System that his company was developing. This can purify 35 liters of water in five minutes using only the power required to light a 100 watt bulb. If the system can be mass produced for less than $100, as Zolezzi believes, and the output passes the lab tests to which it is being subjected, it has the potential to provide clean, safe water to billions in the developing world. The slum dwellers that I met in Santiago told me that they would routinely get sick and have to go to the hospital because of the bacteria in the water they used. Since the test unit was installed, no one in their community had gotten ill from a water-related disease, according to Rosa Reyes, community leader of the Fundo San Jose shantytown.

To promote open innovation, the Center launched Techolab, which functions as a distributed idea and business incubator that pools the collective brainpower of 9,000 registrants to identify and then nurture disruptive ideas. The best ideas get prize money as well as coaching from experienced scientists, product developers and technologists. Techolab takes a 5 percent stake in the companies. It is like Silicon Valley’s Y Combinator, but for those at the bottom of the socioeconomic pyramid.

Every three months, Techolab launches a competition aimed at solving a specific challenge and seeks to raise the quality of life for the poor. The first contest, run last year in partnership with the Chilean government, sought concepts to improve education, health care, and job opportunities. TechoLab registrants floated nearly 800 ideas and three winners got $60,000 to launch their projects. Subsequent contests have tackled other core quality-of-life issues. Meanwhile, UTPMP has also been working with Movistar on a project to afford high-speed Internet access to 1 million people considered part of the BoP cohort. Claudio Muñoz Zúñiga, CEO of Telefoinca Chile, told me that he believes this will greatly improve the lives of these people by linking towns and health care professionals in distant cities and empowering curious children to teach each other hard subjects.

Here’s where the threads come together: A contest soliciting ideas for applications that can run easily on simple computing platforms such as smart phones and cheap tablets because — let’s face it — the poor aren’t going to be buying MacBook Pros any time soon. Naturally, the 1 million households will be a perfect test market for these applications, which, by the way, should be businesses capable of making real profits. Some of the ideas that have rolled in, according to Ugarte, are already very interesting including a Groupon for simple staples, a ride-sharing application for short-term carpooling that can function on everything from simple mobile phones to full-blown smartphones, and a high-quality, easy ranking system for patients to grade doctors in the public health hospitals.

Granted, all of these ideas have likely been tried or are out there in the existing app economy. But none of them could function under the types of constraints we see at the BoP—namely, extremely low margins and extremely high efficiency. And, equally important, with access to the Internet, the people founding these companies, or their children, will increasingly come from the BoP themselves. And with their intimate knowledge of the cultural aspects of life at the BoP and the social mores and feelings of that market, this new generation of non-traditional innovators could well do a better job helping their brethren than the traditional hand out. Not to mention, they can do so using the vehicle of modern technology, fulfilling the true promise of the app store to serve those most in need.

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In 2000, scientists at a private company called Celera announced they had raced ahead of the U.S. government in decoding the DNA of a human being. Using the latest sequencing technology, plus the data available from the Human Genome project, Celera scientists created a working draft of the genome. These efforts cost more than $1 billion. Today, a complete genome sequence costs about $3,000 and takes about a week. One company, Life Technologies Corp. in Carlsbad, Calif., just announced that it will provide the service for $1,000 and in 24 hours. At this rate, within three years, the cost will be less than that of a simple blood test and the results will be almost instantaneous.

This type of data opens up an amazing set of possibilities.

A genome map is the source code for the software that constitutes living organisms. Imagine doing a Google search on your own genome to learn the health predispositions and likely abilities of people genetically similar to you. You can learn about what medications or lifestyle changes may best prevent a disease.

Today, medicines are generally prescribed on a “one size fits all” basis. When a particular medication causes a significant negative reaction with a small part of the population, it is prevented from being available to anyone. With genetic information, we could be prescribing specific types and dosages of medicines based on a person’s DNA.

And new advances in DNA printing promise to revolutionize biology and more.

Craig Venter, who led the research at Celera, made another stunning announcement a decade later, in May 2010. His team had, for the first time in history, built a synthetic life-form — by “writing” DNA.  The slow-growing, harmless bacterium they created was made of a synthetic genome with 1,077,947 DNA base pairs. Today, a number of DNA “print” providers offer DNA synthesis and assembly operations as a service. Current pricing is by the number of base pairs — the chemical “bits” that make up a gene — to be assembled. Today’s rate is about 30 cents per base pair, but prices are falling exponentially. Within a few years, it could cost 1/100th this amount. Eventually, like laser printers, DNA printers could become inexpensive home devices that enable legions of garage biotechnologists and DIY-ers to solve big health problems.

Venter is now using “synthetic biology” technology to try to solve the problems of energy by developing biofuels from genetically engineered algae. The idea is to extract “hydrocarbonlike” liquid that can be turned into transportation fuel.
Tissue engineering and 3-D printing technologies are advancing rapidly and beginning to merge. These advances will allow us to print organs and personalized medicines. A company called Tengion synthesized full-size replacement bladders in 2008, and surgeons in Sweden recently carried out the world’s first synthetic organ transplant — a synthetic trachea/windpipe structure created and seeded with the patient’s own progenitor cells.

Soon, we will be able to “print” sophisticated medical devices. And sensor technologies are becoming ubiquitous, so continually monitoring and recording every aspect of our health from the time we wake to when we sleep will be within reach before long.

All of these advances play to the strengths of engineers. The skills needed for diagnosing health problems are similar to those for analyzing the structure of bridges. Search engines for the genome aren’t that different from search engines for text and video. The same rigor needed for programming new bacteria is similar to what’s necessary for building an industrial robot: developing functional requirements, designing and testing components, integrating these components, and testing for effectiveness, reliability, and safety.

With these new developments, it is clear that our engineers have begun using their skills to solve the problems of human health. Now, it’s time they tackled many other grand challenges that face humanity.

According to that worldview, SOPA and PIPA were ham-fisted attempts by Hollywood types and their buddies in the music business to commandeer the Internet and remove critical legal protections for search engines and hosting companies that may shelter pirates but also promote free speech and technology innovation. The common belief is that SOPA and PIPA represent yet another instance of entertainment industry greed trying to force people to pay up or face litigation—often for questionable trespasses such as viewing a movie they legitimately purchased on more than one device.

For its part, the entertainment industry views Silicon Valley and its wunderkinder (Google (GOOG), Twitter, etc.) as predators seeking to rip off artists and creative companies that need adherence to IP laws to ensure their very survival. In reality, Silicon Valley owes a tremendous debt to Hollywood for the inspiration imparted by great science-fiction shows, as well as extraordinary movies and music. Likewise, Hollywood clearly owes a debt to Silicon Valley. The computer-generated effects, the novel projection technologies, the HD screens and the Dolby and THX sound systems: All arose from powerful raw technology adapted to meet artists’ needs.

Equally important, the tools from Silicon Valley have made it far easier for creative people to express their visions. The 1999 film The Blair Witch Project illustrated how a blockbuster movie could be shot on a cheap camera. And thanks to advances in music technology, a whole new cadre of “middle-class” musicians has emerged, releasing studio-quality music with modest investments. So the relationship between Hollywood and Silicon Valley is, in fact, quite symbiotic—SOPA and PIPA rage aside.

The symbiosis is essential: Silicon Valley has yet to inspire great art, and Hollywood has yet to produce game-changing technology. The two communities together, however, have powered the most important cultural movements of the past century. As Fox (NWS) Studios Chairman Jim Gianopulos said on the panel, the relationship suffers from periodic friction but is hardly a hate-fest. In fact, the arts have served as Silicon Valley’s muse for many, many years.

I instinctively have known this for some time. I grew up watching Star Trek, and I would venture that half (or more) of the successful entrepreneurs in Silicon Valley also grew up watching this innovative program. (For example, Elon Musk, the founder of Tesla Motors (TSLA) and SpaceX, and a panelist at the event, also grew up inspired by Star Trek). The show managed to foretell key parts of the technology evolution. A communicator is a smartphone, although smartphones can do a lot more than communicators. A replicator is a 3D printer or another form of additive manufacturing technologies. And the Star Wars films inspired a generation of filmmakers and revolutionized the field of special effects, which in turn fueled tremendous innovation in computing and chips specifically designed for graphics processing. And this enabled the current generation of incredibly rich, detailed video games.

So peel back the surface tension, and Hollywood and Silicon Valley are tightly intertwined in a symbiotic feedback loop. This feedback loop is a powerful driver of innovation, which drives more art, which then drives more innovation. This is even true of the Internet itself.

The point of all this? Next time the geeks in the Valley get riled up about Hollywood hotshots trying to ruin the Internet, take a deep breath and ask yourself whether you watched the original Battlestar Galactica (remember those Cylons?) or read Philip K. Dick, father of Blade Runner and Total Recall (artificial life-forms are now being built by Craig Venter). As for you Hollywood types who view Silicon Valley as a bunch of techie hackers who don’t respect artists’ rights, please keep in mind that draconian tactics and extremely strict interpretations of DRM (digital rights management) policies have angered Silicon Valley.

Step beyond the SOPA and PIPA madness, and it becomes quite clear that Hollywood and Silicon Valley have far more interests that are aligned, not divergent.

Link to this article on Bloomberg BusinessWeek

In June 2010, ten startups at the Softex incubator at the Universidade Estadual de Campinas decided to break free from the university incubator they were housed in and form an entrepreneurial co-op of sorts, called the Associação Campinas Startups. Instead of relying on local business executives and professors to guide them, the entrepreneurs decided to learn from each other. The university was very supportive, and business mentors went out of their way to share their knowledge and experience. But the advice was always too theoretical or geared towards big companies. In short, it wasn’t relevant to the leaner, fast-paced technology world. Instead, the entrepreneurs found the greatest value in brainstorming sessions and casual information exchanges with each other over lunch or drinks after work.

This is a common problem for nascent tech incubators all over the world. Unless the entrepreneurs receive active mentoring by entrepreneurial superstars like Paul Graham, Brad Feld, and Dave McClure, almost always the startups and incubators both fail. A successful incubator’s value is in the knowledge shared, not in the office space and administrative support.

There was no Graham, Feld, or McClure in Campinas. So, the entrepreneurs decided to pool their knowledge and help one another. They would meet informally every day, and formally once a week. During the formal sessions, each startup would “scientifically” present the one big idea they were pursuing, a hypothesis on why they believed this would lead to success and measurements to back up their assessment. And during the weekly sessions, they would report their progress on implementing their ideas.

When you are a lone entrepreneur, you are answerable to no one but yourself, and it’s easy to go astray. You don’t have a board to hold you accountable or to guide you when you go off track. The Campinas group’s “peer review” served this purpose. It forced accountability, placing pressure on each team to plan and to perform. It also allowed the entrepreneurs to learn from one other.

Within a year of getting the association into high gear, the ten original startups and two more that joined, had increased their aggregated revenue from $330,000 to $2.1 million. They increased their combined headcount from 39 to 56. Many of the startups changed their strategies and plans, but none, so far, have failed. Several received funding from local angel investors. And this year, ten more startups have joined the group.

Gentros, a biotech startup that joined the association after its founding in 2008, produces vaccines for farm animals. Its CEO, Taíla Lemos, told me that, without the advice and mentoring she received, her startup would certainly have failed. Even though she was in an entirely different industry than the other entrepreneurs, the principles for building a successful company were the same. They taught her how to determine what her costumers needed, identify scientific viability, and manage her R&D projects. She learned the principles of “lean startup” development – the process of quickly developing a proof of concept, testing it with customers and iterating.

There is no telling if any of these startups will survive or achieve long-term success. There are no certainties in entrepreneurship. But the quality of the companies I witnessed was distinctly better than that of the startups I’ve seen in Silicon Valley. Ultimately, I give the startups being fostered in Campinas a higher than average chance of success.

There is also a lot happening on the entrepreneurial scene in Sao Paulo. The most energetic of these groups, Brazilian Innovators, is run by Bedy Yang—an entrepreneur who lives in Silicon Valley, but travels frequently to Sao Paulo to organize networking events. The meetings start with words of wisdom being shared by Silicon Valley entrepreneurs talking over Skype, and then turn into information exchange sessions over wine and cheese. What started two years ago as a group of two dozen has blossomed into a gathering of 300 attendees.

My prediction is that, by the end of this decade, we will see some Mark Zuckerbergs emerging from the slums of Sao Paulo or New Delhi, India or Valparaiso, Chile. Why, you ask? Because entrepreneurs are doing what governments can’t—creating innovation ecosystems.

Link to this article on Washington Post’s website

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These were some of the things we discussed at the Singularity University executive program on the Mulberry Street set at Hollywood’s Fox Studios, last weekend. Entertainer and technologist will.i.am, Fox Filmed Entertainment Chairman and CEO Jim Gianopulos, and Tesla and SpaceX founder, Elon Musk, provided some amazing insights into the symbiotic relationship between Hollywood and Silicon Valley.

With the SOPA battles still fresh in their minds, many people in Silicon Valley view Hollywood as an evil entity seeking to limit how they watch the movies that they legally bought, or threatening to sue or shut down anyone who watches, searches for, or even thinks about a movie that may be pirated. Down South, Hollywood believes that it is fighting for survival; that rather than being grateful, Silicon Valley is behaving like a predator.

So where is the truth?

Let’s start with what Jim Gianopulos said about the role of science fiction in innovation (watch the video at the end of this post). I think he is right. I remember how I, as a child, would dream about using my “communicator” to talk to friends across the globe and my “replicator” to create fancy desserts; how I imagined travelling to distant worlds in my spaceship and talking to aliens through my “universal translator”.

Look at where we already are. As Rod Rodenberry said to me at the Fox event, the iPhone is even more advanced than what his father, Gene, had envisaged. Captain Kirk’s communicators didn’t receive emails, browse the web, or play music, after all. 3D printers can now “replicate” chocolates, human organs, and buildings. This printing technology is in its infancy, but watch what happens later in this decade. And then there is space travel. Elon Musk is developing not only the Tesla terrestrial sustainable transport vehicle (aka Tesla Roadster), but also spaceships for interplanetary travel using Star Trek-style thrusters (U.S.S. Enterprise version 1?). Elon plans to retire on Mars. He may well live his dream.

As well, will.i.am made intriguing comments about music’s role in innovation. He said that Hollywood was a marriage of art and science: the science to make the camera work and the art for the script. Silicon Valley hasn’t had its “art marriage” yet, but music has helped it evolve. Music has long spread ideas and inspired people to create. Will said music was the “spreading of inspiration”, “the first social network”.

Will too is right. Steve Jobs, for example, was a huge fan of Bob Dylan in particular and music in general. This passion may have influenced his decisions to build simple yet powerful music-creation software for the Mac. Try remembering when you heard a special song for the first time. You won’t be able to, but you’ll sure remember the circumstances—the point being that the art is essential for technology innovation.

So let’s give credit where it is due. We owe a lot to Hollywood.

On the flip side, the reason that big Hollywood names like Ashton Kutcher, will.i.am, John Cusack, and Troy Carter (Lady Gaga’s manager and ingenious strategist) wanted to attend our event is that they know what Silicon Valley has done for them. All the computer-generated effects, novel projection technologies, HD screens, and Dolby and THX sound systems were built to meet the needs of artists. Equally important, the tools from Silicon Valley have made it far easier to express artistic endeavors for fun and profit. The Blair Witch Project illustrated that a multimillion-dollar blockbuster could be shot on a camcorder.

The relationship between Hollywood and Silicon Valley is, in reality, quite symbiotic — SOPA and PIPA rage aside. It has to be, because Silicon Valley has yet to inspire great art, and Hollywood has yet to produce great technology. The two communities together, however, have powered the most important cultural movements of the past century. As Jim Gianopulos noted, the relationship suffers from periodic friction but is hardly a hatefest. In fact, the arts and entertainment have served as Silicon Valley’s muse for many, many years.

Online piracy is an issue that will continue to divide North and South California until solutions are found. Hollywood doesn’t want its films and music being pirated just as Silicon Valley doesn’t want its intellectual property being stolen. Neither wants the producers of counterfeit goods and fake drugs selling their wares to unsuspecting consumers.

Silicon Valley needs provide the leadership here. It needs to take note of Hollywood’s concerns and rein in the real bad guys.

The exchange, according to a Jan. 12, 2012 report in the New York Times, occurred in Feb. 2011 at a dinner in Silicon Valley. The late Steve Jobs was right. Even though advances in automation, 3D printing, and the rising costs of labor in China will cause manufacturing to return to U.S. shores, we won’t need the millions of factory workers we needed in the past. That’s because the manufacturing jobs we need filled today are different from the ones we sent abroad. These jobs require fewer workers with very different skills.

Does that mean we are we destined to suffer from chronic unemployment? Far from it. We will create new types of jobs in industries that we have not even conceived of yet. These jobs are likely to raise our standards of living, improve our quality of life, and unleash our creativity.

This may strike you as a utopian dream, but look at the industries that the mobile phone applications economy has spawned since the advent of the iPhone in 2007. An analysis by economist Michael Mandel showed that, as of December 2011, the mobile “app economy” employed 155,000 tech workers in the U.S. Another study by University of Maryland professors Il-Horn Hann, Siva Viswanathan and Byungwan Koh determined that the Facebook apps platform, which was also launched in May 2007, resulted in the direct employment of an estimated 53,434 third-party developers as of September 2011. These numbers don’t include the jobs created in related technical fields and other sectors of the economy: 311,000 in mobile apps and, on the lower end of study’s estimate range, 129,310 in Facebook apps.

Similarly, the new manufacturing will create new types of jobs. We can only guess what these jobs will be and what new industries will emerge, however. The one thing we can be sure about is that we will require a workforce with much different skills and education than what was required for the manufacturing jobs of yesteryear.

Carl Bass, President and CEO of Autodesk, which develops 3D design software for manufacturing, engineering, and entertainment, sees three key developments that will define the new manufacturing jobs: new materials, new processes, and complex integration of automated systems. (Full disclosure: Autodesk is a corporate founder of Singularity University, where I serve as vice president of academics and innovation in addition to my roles at Stanford, Duke, Emory, University of California-Berkeley and Harvard.)

Engineers and scientists are developing many new types of materials such as carbon nanotubes, ceramic-matrix nanocomposites (and their metal-matrix and polymer-matrix equivalents), and new carbon fibers—such as those which BMW is using in its new i3 Concept vehicle. These new materials enable designers to create products that are stronger, lighter, more energy efficient and more durable—opening up new applications that create new markets and displace traditional materials. The key, however, is the ability to apply these materials in high volume and with low costs. This is a challenge that requires innovations in material processing technologies and more highly skilled employees to manage the complex, new manufacturing processes. Prospective employees will need extensive training in order to work in this new environment.

The process of manufacturing is also changing. In conventional manufacturing, parts are produced by using power-driven machine tools, such as saws, lathes, milling machines, and drill presses to physically remove material and achieve a desired geometry. To achieve this, skilled machinists use sharp cutting tools to carve objects from metal wood, plastic, ceramic, and composites. In a new method called “additive manufacturing,” parts are produced by melting successive layers of materials based on 3D models—adding materials rather than subtracting them. This allows manufacturers to create complex objects without any sort of tools or fixtures. The process also doesn’t produce any waste material. 3D printing is only one example of “additive manufacturing.” Machinist jobs will need to evolve in order to deal with greater complexity. This new manufacturing environment will also need legions of 3D designers and people who can operate and maintain sophisticated computer-based equipment.

In today’s manufacturing plants, information systems are usually very hierarchical and depend on predetermined rules. As manufacturing systems become more complex, it will become much more difficult for individuals to spot small deviations and trends within the system. This means that factories, in a way, will need to become “self-aware” in order to support optimized systems. This self-awareness will cause transformations in the way people work. There will be far greater use of simulation to look at the manufacturing systems’ ability to react to changes, such as the introduction of a new product or factory rearrangement. The line between the virtual and physical world will also start to blur, forcing most manufacturing engineers to become more adept at dealing with virtual control systems simulation and other such technologies.

The good news is that this new manufacturing, if and when it’s realized, will allow American manufacturers to compete on a global scale again. But the U.S. will have to fundamentally re-engineer its education system if its citizens are to enjoy a rising standard of living. The current system was designed for a rural, agrarian population, not one that’s increasingly urban and competing globally. Tomorrow’s manufacturing workforce will have to be prepared to do new jobs that are less mechanical and, instead, require creativity and thought. There is no shortage of problems to solve, products to build, and technologies to develop. So, the more skilled workers the nation has to address these challenges, the better the employment and economic outlook will be.

Link to view article on Washington Post’s website

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My father, a retired Indian diplomat, called me on several occasions to plead that I tone down my criticism. He worried that I would anger U.S. government officials and they would find some way to have me deported. Indeed, this would have been the case in many countries, where I could have ended up in a Gulag — or worse.

But what happens in America?

The Government gives me an official recognition — Outstanding American by Choice — for my “commitment to this country and to the common civic values that unite us as Americans.” When I received the call from U.S. Citizenship and Immigration Services Director, Alejandro Mayorkas, I had tears in my eyes. He told me that the government appreciated all of my efforts to make the country more competitive and that my criticisms of his department had motived his team to work harder to improve the system.

This is the greatness of America and why this country leads the world: Disagreement and debate are cherished. Challenging the norms, thinking outside the box, and questioning those in power is encouraged and celebrated. The louder you speak the more prominence and respect you are given. Society’s heroes aren’t merely revolutionaries or political figures, but opinionated, non-conformist entrepreneurs like Steve Jobs and Mark Zuckerberg.

This is what distinguishes American children from others and why they grow up to be innovators. From childhood, they are encouraged to pursue their dreams and to challenge authority. So they challenge their parents, then their teachers, and then their government. And they learn to work with each other and compete. There are no barriers to success. If you work hard, think smart, and persevere, you achieve success. And this success is celebrated. Reaping fortunes through entrepreneurial success even has a special label: it’s called the American Dream.

America’s unique strength is that it also welcomes foreigners. Yes there is some discrimination and there are a few hurdles to leap over. But once you surmount these, you are treated like everyone else. You are given the same respect and have the same opportunities. You can compete in any field. And this is what has been happening through American history: wave after wave of immigrants has landed on American shores, embodied its values, and helped birthright citizens to work harder and think smarter.

Today, America is in a slump. The ups and downs of the economy and rise of new global competitors are discouraging and often cause American’s to lose hope. But, as someone who came to the U.S. by choice, and who has studied the warts of this country and its competitors, I have no doubt that the U.S. will continue to prosper and lead the world.

It has to—no other country has the ingredients for long-term success.

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Ali Velshi, Vivek Wadhwa, and Peter Diamandis discuss how innovations made by small business and entrepreneurs will be key to economic recovery in the United States.

Facebook’s IPO

Sadly, everyone is going to be disappointed.

We are not going to see the flood of IPOs that happened during the late 90’s. The rules of the game have changed. The infrastructure to facilitate IPOs is no longer there, and the regulatory environment has changed. Joe Grundfest, a professor and a colleague at Stanford Law School, outlines four reasons why the path to the IPO has become so steep for aspiring companies.

First, regulatory costs for companies that aspire to go public have increased substantially. Lawyer and auditor fees have mushroomed in the wake of the Sarbanes-Oxley Act, and these professionals cannot be paid in stock. They require cold, hard cash that could otherwise be spent on engineers, sales staff, hardware acquisition, marketing, and other revenue generating functions. Then, once a company goes public, it has to scale up its board membership to comply with more extensive governance requirements as outlined by the NYSE and NASDAQ. And larger boards are more expensive in terms of both the cash and equity commitments required on the part of the company.

Second, the financial markets have changed. It is increasingly difficult for a new company to persuade investors that its investment thesis isn’t otherwise captured in a more efficient form by any of a number of industry-based indexes. Only larger companies with a unique story can pass this hurdle. This means that companies such as Facebook and Google can still go public, but an army of smaller, less-differentiated firms will have a hard time.

Third, the analyst sector, which does the intense, company-specific grunt work for IPOs, has been decimated. The Wall Street Analyst settlement, which tried to remedy the misleading reports that analysts were allegedly publishing, eliminated the incentive for financial firms to hire the armies of analysts necessary to cover smaller IPOs.

Fourth, many of the largest and most successful sectors display winner-take-all characteristics early in their evolution. Again, look at Facebook and Google, both of which have been buying up companies that are either in direct competition or are developing complementary technology. In the 1990’s, the smaller companies might have survived to be able to go public, but not today. Put another way, in the 1990’s we could run the race to find the dominant firm after the competitors went public. Today, however, the race is usually over early in the game.

So, the tidal wave of IPOs isn’t going to happen. But this isn’t a bad thing.

Yet another professor from Stanford Law School, Dan Siciliano, says that venture capitalists prefer companies with as clear a path as possible to an IPO. Why wouldn’t they? IPOs provide big returns, great liquidity, and positive publicity.

It used to be that VCs’ preference for the IPO determined the fate of most tech startups. Today, the VC’s IPO preference is becoming increasingly irrelevant because most technology startups, especially those in software and cloud computing, don’t need as much money to get off of the ground as they used to. Fledgling tech companies have a larger network of angels, incubators/accelerators and sometimes the relatively deep pockets of their own serial entrepreneur founders. This makes it possible for some companies to achieve break-even cash flows earlier than in the past.

Siciliano argues that an over-heated technology IPO environment can create a frenzy of VC funding like what we saw during the dot com bust—when start-ups made the all or nothing dash to the IPO. This leads to unhealthy boom and bust cycles. What is better is to have companies with a long-term focus—which grow and add jobs steadily. VCs and entrepreneurs looking for exits can always pursue acquisitions by long term players.

So we don’t need to be overly concerned if we don’t see a burst of IPOs. The innovation and job creation will still happen. These jobs just won’t be in investment banking. We just need the IPO market to remain robust enough to periodically mint future angel investors and provide the healthy returns for top-tier venture capital firms.

Full disclosure: The Washington Post Co.’s chairman and chief executive, Donald E. Graham, is a member of Facebook’s board of directors.

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