Live from #EIS13: Elon Musk and Steven Chu talk about what makes innovation - SmartBrief

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Live from #EIS13: Elon Musk and Steven Chu talk about what makes innovation

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In order to radically innovate, your company has to be small and nimble, said Elon Musk, CEO of Tesla Motors and CEO and chief technical officer of SpaceX.

“It’s generally true that the larger a company is, the harder it is to execute their vision,” Musk said at the ARPA-E Energy Innovation Summit in Maryland. However, there are exceptions, such as Apple, which had a strong leader in Steve Jobs, who was relentless in his vision for the company.

However, when a company is small, it can be a challenge to acquire the means to execute a vision, which is where companies such as Tesla have benefited through partnership with the federal government through ARPA-E. Musk said that the company has a federal loan through the Advanced Technology Vehicle Manufacturing program. The loans are based on companies meeting a series of milestones on time, and Musk was pleased to say that Tesla will repay its loan in five years, rather than the 10 required.

Musk said the program is an example of how investing in high-risk, high-reward projects like ARPA-E does can be worth the gamble.

Sitting next to Musk on stage was Energy Secretary Steven Chu, who said that his department is large and not as nimble as small companies. However, it is able to sponsor innovation that the public sector can pick up and run with.

Chu said that the U.S. faces an employment crisis, in that skilled or manufacturing jobs have remained flat remained flat. This could put the country at a competitive disadvantage with the rest of the world, he said, so by fostering the growth of new industry ideas, the Department of Energy is helping the U.S. economy in the long run.

Selecting the right projects to sponsor can be a challenge. Chu said he looks for the “glimmer of breakthrough” in a project to spot an innovator, where there is evidence of a new way of thinking or applying a technology to an industry that has never tried it before.