The Forgotten Man…and some notes

Just finished reading the Forgotten Man. Lots of good stuff in this very detailed book, but one thing that stood out was the actions on Andrew Mellon.

In the mid 30s he created a the idea incubator, the Mellon Institute. Which made me think about today’s idea incubators like Techstars and Start at Spark.

The effectiveness of the Mellon Institute at the time is what I’m most interested in. In 1936 companies gave $816,000 to create 69 fellowships. The Institute created a place for so much research to be done. This, in turn, resulted in hundreds of patents and increased innovation and productivity for the contributing companies.

The fellowships worked in a fashion where a company would come to the Institute with a problem, pay a fee for engineers and scientists to work on the problem, and then receive a solution.

This was revolutionary at the time because Mellon created a destination for companies with problems. No longer were companies working in a bubble – the problems were brought to the forefront.

At the time, this was powerful stuff. His philosophy on investing in new companies was simple and effective.

Are things the same today in these similar economic times? Are the aforementioned incubators providing a similar service? One thing is the same – efficiently placing capital with people who can solve problems and build businesses usually works out well for the founders and investors.

Some more info: