Place

Building a Home for Innovation: From Incubators to Constellations

If we’re to view innovation as a tangible discipline, we need a home for it. The concept is not new. But environment is increasingly recognized as an innovation enabler. Whether it’s a lab, incubator, or cluster, a sense of place and its accompanying resources are a key contributor to innovation success.

Considerations regarding the optimal innovation environment are somewhat contradictory: Structure a space that’s informal and unstructured. Have technology at the fingertips of the innovator, but make sure it’s unobtrusive. Build places that foster direct connection and trust, yet can access outside expertise immediately.

Cleveland Clinic has been the convener, architect, landlord, and tenant in practically every physical manifestation known to the innovation ecosystem. This chapter will visit all the addresses of innovation—the buildings, neighborhoods, and broader geographies—and share our lessons learned.

Place is important because innovation occurs optimally at the intersection of knowledge domains. Throughout history, the greatest scholarly advances, technical breakthroughs, and artistic developments occurred in the port cities of the world, where people of different cultures convened and shared fresh ideas. For example, Florence was the epicenter of the Renaissance largely because the Medicis made it a magnet for merchants, artisans, philosophers, architects, scientists, and musicians.¹

I subscribe to the law of propinquity, which means nearness in place or time, amplified by an intimate intellectual connection. Propinquity differs from simple geographic closeness because the term implies physical proximity and cultural alignment, two critical variables for a great personal relationship, professional partnership, or creative collaboration. Propinquity can accelerate innovation victories and increase their value.

Our job as innovation leaders is to foster propinquity—to network creative people, new ideas, and necessary resources to maximize opportunities and the likelihood of success. Cleveland Clinic, as one of the world’s iconic medical systems, has the gravitational pull to attract colleagues with prodigious talent and big ideas. So our focus is on resource allocation and process management in an environment ideally suited for innovation.

Incubators as the Front Door of Innovation

If innovation means putting ideas to work, where does innovation clock in? Where is the front door, or more important for commercialization, the loading dock or sales counter? Where do ideas become innovations and, eventually, entrepreneurial companies? The answer for the past several decades is the incubator.

When Cleveland Clinic pioneered having an innovation function within a nonprofit hospital environment, we recognized there might be limitations to how far an idea could be taken toward commercialization on our campus. We weren’t going to build a medical device fabricating plant next to our operating rooms. However, there are advantages to both the institution and the fledgling company of close proximity during the most vulnerable time of development, incubation.

This section of the chapter will: (1) define the contemporary incubator and compare incubation models; (2) describe how Cleveland Clinic Innovations (CCI) leveraged physical space to promote core competency in innovation and successfully spun off several companies; and (3) equip the reader to advocate for a dedicated physical space for innovation.

Incubation Models

Incubation essentially means optimizing the chances of success for an entity that needs to transition from a less mature to a more mature state. It requires a catalytic environment that facilitates resource access. The energy that activates the catalysis is collaboration, which is influenced by proximity.

An incubator is the cradle of innovation and should be a dedicated space that fosters creativity and collaboration. An incubator should house services facilitating the growth of commercially viable entities and provide one-stop shopping to outside stakeholders.

You must identify the specific advantages an incubator may impart if you’re to sell the concept of building a physical space and eventually optimize innovation in it at your institution.

At Cleveland Clinic, we had the opportunity to create a novel incubator model to support promising ideas at their most vulnerable stages. We continue to improve upon this critical link between organic institutional innovation and industry’s commercial development.

In the mid-1990s, when Joseph F. Hahn, chairman of the Division of Surgery, and I were scouring Cleveland Clinic for resources to pilot my original orthopaedic device portfolio through the internal technology-transfer process that would become CCI, we found the exercise time-consuming and sometimes frustrating. CCI’s present location had not yet been conceived, so this exercise required visits to both on- and off-campus legal offices, a variety of engineering facilities, and a small prototyping lab.

We were not only motivated to develop a sustainable process to control IP, we were also interested in aggregating the resources in one place to introduce efficiency and facilitate the engagement for the busy inventor whose main priority was the clinic, operating room, or laboratory. After I left Cleveland for Baltimore in 2000, Dr. Hahn and Chris Coburn, CCI’s inaugural executive director, were successful in securing a former dialysis area as CCI’s original home. This was one of the first prototypes for the modern incubator, now prevalent in both the nonprofit and for-profit sectors.

I admit to usually using the terms incubator and accelerator almost interchangeably or in some form of hyphenated mash-up. Any physical location (or even virtual network) that reduces risk, lowers barriers, accelerates knowledge transfer, and increases commercial opportunity deserves both mantles. Cleveland Clinic has enjoyed more success with a model lighter on nomenclature but heavier on discipline at the front of the technology-development process and operated in a flexible fashion later in the commercial maturity cycle to customize resources to needs.

When does an incubator become an accelerator and then a launching pad? The reason most of us in the mission-driven innovation sphere eschew those labels is because our entities typically have characteristics of both, and we don’t usually pass off companies at predetermined development milestones. The distinction is not as important as thoughtful operation on behalf of evolving companies.

Both the incubator and the accelerator deal with early-stage companies—again, probably one of the most confusing terms in healthcare innovation. To some, early stage means prerevenue, while others believe that companies already grossing millions still deserve this moniker. When your early stage is often scribbled on the back of a napkin, you have a slightly different view of the entire continuum! The labels don’t matter; the protection and resourcing do.

There isn’t much dispute about the incubator being where most organic innovations land when they move from idea to proof of concept and definition by initial funding and leadership. If the incubator does its job, the innovator evolves into a nascent business builder surrounded by many of the resources that he or she may not have even known were necessary. Furthermore, once in an incubator, the innovator is surrounded by like-minded, enthusiastic, and equally immature colleagues going through the same growing pains.

By the time the concept emerges from CCI’s internal process, we have performed so much due diligence through analysis of technical and clinical merit and market feasibility that calling the invention’s next station an incubator seems disingenuous. This is true for most innovation functions starting with ideas delivered to them by experts who have identified an unmet need. Yet we still appreciate that there is a long way to go and want to “grease the gears.”

Our physical incubator, the Global Cardiovascular Innovation Center (the GCIC building) houses 20 to 25 emerging companies and several service providers attracted by the dynamic environment where their special skills can be utilized by a number of fledgling companies. The first floor is occupied by CCI’s administrative function, so we maintain constant contact with our gestating entities. Most important, we sit at the periphery of Cleveland Clinic’s main campus because the most valuable asset of any of our portfolio companies is access to the primary innovation engine that is Cleveland Clinic.

The next stop for survivors of whatever process you consider incubation is the accelerator. If the incubator is where seeds and soil are mixed and initially exposed to sunlight, the accelerator is the hothouse where growing conditions are optimized through structure. The emerging business is surrounded by the elements of the commercial ecosystem in which it will be immersed throughout the rest of its market run.

Besides the obvious catalytic activity taking place there, the reason why the term accelerator is applicable is the velocity of almost every part of the entrepreneur’s engagement. It’s like drinking from a fire hose. Within the accelerator model, the validity of the company is pressure-tested by potential investors. The clock is usually ticking at the traditional accelerator; whether it’s weeks, months, or as much as a year, the heat is on, allowing the business to either catch fire or flame out.

Both incubators and accelerators are where innovation grows up to be entrepreneurship. The commonality of infrastructure, mentorship, access, and validation far outweighs whatever subtle differences may exist between routes of entry or time periods during which a company can remain in the ecosystem.

CCI’s successful approach to the continuum of commercialization-incubation-acceleration and the importance of place are illustrated by Cleveland HeartLab, Inc. (CHL). It’s a fast-growing spin-off company with a niche in detection of heart attack and stroke-related biomarkers, developed by researcher and inventor Stanley L. Hazen. CHL first inhabited the CCI building. Initially, the eight employees were comfortable, but the volume of tests eventually stressed the space. Cramped conditions and wooing by attractive out-of-town investors led CHL to consider leaving Cleveland. But proximity to Cleveland Clinic, availability of favorable rents and support services, and a tax credit from the State of Ohio for job creation kept CHL here. It rapidly grew to more than 80 employees after moving from 7,000 square feet in CCI’s building to 27,000 square feet in nearby MidTown Tech Park. CHL continues to grow a few blocks from Cleveland Clinic and consistently seeks to expand its portfolio of tests by licensing novel assays developed in our laboratories.

The space and services CCI provides to spin-off companies is vital, but there comes a day when their growth outpaces our ability to nurture them adequately. Maintaining a currency with real estate locations and having access to state funding sources gives CCI an advantage that translates into success for the companies, our institution, and the region.

Does a nurturing incubator increase the likelihood of evolving concepts that are successfully translated into commercial concerns? Contrary to common sense or basic deductive reasoning, the answer appears to be no, if you believe much of the scholarly data and business media. It’s estimated that 90 percent of these instruments will fail—not 90 percent of gestating companies, but 90 percent of the incubators and accelerators themselves.²

Here’s where one of the fundamental differences between for-profit thinking about innovation incubators/accelerators and the mission-driven approach becomes obvious. These commercial incubator failures are determined by return on the investments made to start them. The reasons for failure of the incubators and/or the companies they are gestating are the usual suspects that plague each startup: lack of funding, mentorship, and business development connectivity to key transactional resources (financiers, clients, investment bankers, and potential acquirers). Aside from the thrill of gaining admission to a prestigious accelerator program or of participating in beauty contests with investors, there may be little appeal for the best-in-class ideas to relinquish the customary 7 percent of equity demanded by the typical commercial accelerator.

The philosophy and operation of the mission-driven incubator-accelerator is fundamentally different. While the following list of characteristics is likely incomplete, it highlights the divergence in model from the commercial entity:

Admission. Mission-driven projects come through the institutional pipeline, versus an open, public competitive admissions process. They emanate from a domain expert who recognizes an unmet need and solves it right on your campus. Then the concept is exposed to the rigorous processes within the innovation function that is likewise controlled by the institution.

Timing. Most mission-driven models don’t have strict limits or cycles that create artificial time pressures to succeed or fail. Academic medical centers (AMCs), specifically, are in it for the long haul because what we’re developing may change lives or the way we deliver care to large populations. Starting a stopwatch on innovation, as many commercial incubators are forced to do, isn’t aligned with the basic tenets of mission-driven innovation.

Service. The mission-driven incubator-accelerator maintains a similar type and amount of physical services and human resources as a commercial entity, but benefits from economies of scale through affiliation with a major institution. Our incubator is an extension of our institution and enjoys every advantage from proximity, resource sharing, and access—these are huge advantages that have fueled our success.

Equity position. Most AMC and research university IP policies call for an equity position to be shared between the inventor and the institution from the outset of idea generation and development. However, Cleveland Clinic’s model and that of the Global Healthcare Innovations Alliance (GHIA) includes no additional equity stake simply for housing in the sponsored incubator-accelerator. Removing an economic disincentive is beneficial enough, but it also frees up capital to be recirculated into the core business.

Connectivity and cross-pollination. The sense of community that exists when entrepreneurs grow up together is motivating and nourishing. That isn’t the sole purview of mission-driven incubators, but it is unique on AMC and research university campuses. The reason is that these innovators also practice together or share a research focus and feel loyalty to the sponsor institution. There is freedom to share ideas and resources. Undoubtedly, this is why incubators and accelerators in proximity to the academic center often thrive.

We are focused on service and connectivity to our teeming main campus, but we have always been light on meddling in the daily affairs and operations of our spin-offs. We hold board seats and are always available at critical navigation milestones—for example, introducing companies to potential clients.

But don’t mistake proximity for obtrusiveness. Walking the line between active assistance and intrusive interference is a tightrope almost every mission-driven innovation engine will face in starting an incubator. It has taken time and experience, but CCI has done this expertly and shares that knowledge freely with other organizations.

We have confidence in the quality of our ideas, the rigor of our basic innovation infrastructure vetting the technologies, and the nurturing environment our incubator provides. Some may consider the approach we take as our portfolio companies mature to be passive, like “latchkey parents”; we just think it’s practical. Let entrepreneurs do what they do best and allow the market forces to work with minimal interference.

Selling the Incubator Concept

Let’s start with why it might be logical for an institution to contemplate creating a physical space to serve as the nucleus for innovation and entrepreneurial activity. The sole focus of the incubator is to accelerate and facilitate the commercialization of transcendent ideas; most argue that this takes place through colocation or clustering.

Reputation and resources are at stake when entertaining a decision of this magnitude, so innovation leaders must be prepared to sell the value of the incubator concept. Have both subjective and objective data at your fingertips.

The decision is informed by multiple variables, ranging from depth of talent and idea flow to financial resources. To take some pressure off the front end of the process, remind all participants that a decision against investing in a physical plant doesn’t have be considered permanent; staggered or near-simultaneous planning can always take place while an incubator is being launched programmatically. We caution that this decision can’t always follow the normal formula of incremental revenue:incremental spend. The return on innovation investment takes a while to develop, and often the pump needs to be primed.

It may make sense to concentrate on an institutional strength to accelerate the idea flow and potential success. Your organization may be heavy into health information technology (HIT) or medical devices. An anchor strategy makes the argument more compelling and informs the type of physical space required. Don’t disregard the possibilities that arise from juxtaposing neighbors of different backgrounds, but cross-fertilization potential is maximized when tenants are at least remotely related.

Unlike other decisions that the CEO, CFO, and trustees may be accustomed to making based upon P&L statements or business plans (aside from possible real estate management elements inherent to incubators), this decision is more a vote of confidence. The innovation champion must bring passion and optimism and be prepared for pushback, especially in organizations still grappling with how to budget innovation.

This is especially true in the early years of programs when revenues are episodic or nonexistent, but there are always going to be dry spells in this business. In fact, when it seems that creativity is at a nadir is the time when something catalytic like an incubator may have the most impact.

What Should the Incubator Have to Serve Your Clients and Their Clients?

The aim of the incubator is to aggregate what will help the innovator become an entrepreneur, removing distractions and time sinks associated with foraging for necessary resources and relationships.

Technical or operational infrastructure comes first. The checklist typically includes wet labs, a wired environment, and computing capabilities. Modular walls or flexible interior design elements, like furniture on wheels, can maximize attractiveness to a variety of different companies and minimize the hassles as companies grow.

Full-time, skilled IT professionals are a necessity. The incubator sponsor cannot cut corners in this area. Having skilled IT professionals is one of the most critical contributors to a fledgling company’s success, but they can be hard to find and expensive to hire, which is why they are such a logical resource to be shared by tenants. Despite the advanced knowledge Millennials all appear to have with the digital economy, dedicated IT resources will be welcome. There’s likely the need for Health Insurance Portability and Accountability Act (HIPAA)–compliant servers if you’re hosting healthcare and informatics companies.

Don’t forget about parking. You’re building an environment in which emerging companies are going to do business. Adding to the young companies’ professional identity and servicing them to recruit talent and entertain clients means maintaining the expected amenities, like parking. Only slightly less appreciated is nearby food service, a full kitchen, and a communal break room that can promote cross-pollination between tenants.

At CCI, we have food trucks come in once or twice a week—what a hit! This not only nourishes the bodies and minds of the innovators, but also adds to the contemporary vibe of the incubator environment.

It also never hurts to have a fishbowl, an informal communal space, replete with seating and equipment conducive to stimulating and capturing stream-of-consciousness thinking. The fishbowl is the contemporary water cooler around which innovators from different entities convene to compare notes and potentially create the electricity that solves existing problems or identifies future directions. Having the type of wall coverings on which innovators can write and draw and then capture their scribblings with their smartphones replaces the conventional napkin.

A bull pen of talent that can be distributed and democratized makes for an attractive incubator. Ready access to the expertise and experience of seasoned veterans may be the greatest asset incubators provide. CCI has approached this need in two ways. The entire staff, including the chief innovation officer, resides right in our incubator, so the people who helped the companies through their fledgling stage remain close by as companies mature. In addition, we have entrepreneurs-in-residence (EIRs) who can provide ready insights on navigating the path toward the marketplace.

It’s not uncommon for the EIRs to transition into more permanent roles in management or governance within the companies they mentor. The pool of EIRs is designed to be frequently refreshed; as serial entrepreneurs exit successful companies, they often have time and energy to devote to protégés. Creating these win-win scenarios is one of the more compelling arguments for maintaining an incubator structure.

Our EIR program seeks to maintain a mix of domain expertise, career stages, and geographic distribution. Most of CCI’s EIRs, like physicians, have a general knowledge of emerging innovations across the spectrum of healthcare but concentrate on a specialty area. Company building in medical devices, therapeutics and diagnostics, and HIT can present different challenges and require specific insights, so we maintain a stable of EIRs who represent these key domains. Regarding career stages, balance the seasoned, serial impresario with the enthusiastic early-career entrepreneur who may have just completed a second or third exit.

There is a regional or cluster mentality that still seems to exist in the innovation ecosystem, despite free information exchange across state or international boundaries. Building a mosaic of EIR talent with a wider geographic perspective may have benefits, as the EIRs can relate what is happening in other areas of the country. Ensuring that EIRs have the chance to interact can be a confidence builder and catalyst for success for your incubator companies.

One of the most logical and engaged sources of EIRs are the incubator alumni. They have walked a mile in the shoes of the tenants and crossed the finish line. The graduates have the experience, but it’s multiplied by their enthusiasm for the incubator concept. Keep the successful entrepreneurs spawned through your process relevant and involved as mentors.

We also leverage the strength of our institutional identity to assemble the appropriate technical and financial players. Networking is slightly different in the healthcare innovator/entrepreneur community than in the business sector. We tend to bring investors, potential clients, and acquirers to the incubating companies—they are visiting Cleveland Clinic anyway, conducting supplier-client business. That isn’t to say we haven’t mounted more than our share of road shows. Those who desire a sneak peek into tomorrow’s solutions and promising investments are attracted to the incubator because it’s an efficient way to be immersed. Connect with those who administer your supply chain (also called formulary) to bring visitors.

The final recommendation is a communications function. The incubator should be a source of pride for the parent institution or sponsor, as well as all other emerging companies that reside within. Company milestones, especially key investment rounds, product launches, and exits, should be very public. Parent institutions, which usually maintain a robust marketing and public relations capability, can teach the young companies about getting their messages out.

What Are the Incubator’s Mission, Vision, and Goals?

Never underestimate the importance of defining mission and vision, nor the difficulties encountered in doing so. We don’t stray from CCI’s core mission: serving inventors and entrepreneurs by assisting them to develop innovations focused on improving and extending human life. How is that expressed in the operation of our incubator?

When we developed our incubator-accelerator, it focused on support, access, and validation for innovative Cleveland Clinic colleagues and those of our GHIA partners. By combining the home office of CCI with the incubator function, there’s bilateral benefit: those engaged in organic innovation are motivated by seeing colleagues in the throes of company creation, and emerging enterprises have access to a steady stream of new ideas and talented individuals.

Enhanced institutional identity, community economic development, and talent attraction are consequences of executing to our mission. Innovation success is self-perpetuating, as graduates become mentors, investors, and serial entrepreneurs.

How Will the Incubator’s Success Be Measured?

Cleveland Clinic’s measures of success reflect more than occupancy and company performance and include innovator service, identity advancement, and community partnership. Operation of an incubator should at minimum be budget-neutral. Some universities and hospital systems have been very successful at managing the incubator as a revenue-producing real estate asset. However, the yardstick by which the innovation community gauges an incubator’s success is the attainments of its companies.

Some common metrics to consider are:

Number of tenant companies and how many were grown organically versus attracted from outside the institution

Number of new business starts generated from the incubator’s sponsor institution

Amount of follow-on investment attracted by incubator companies

Whether the incubator has attracted support companies, meaning platform technologies or service providers drawn by the opportunity to interact with gestating companies

Number of jobs created, the holy grail for economic development and elected officials

Velocity of product/business development once a company becomes an incubator tenant

Quantified usage patterns of shared incubator services and expansion/contraction activity of tenants

Number and success of ideas/companies that were created by interactions among incubator companies

Amount of private-sector funding, governmental grants, or philanthropic donations and how the deployment of these monies has been transformative for the incubator and companies

Graduation rates, recognizing that optimal company size and timing of exit or acquisition are variables that cannot be controlled by the landlord

While we consider the accomplishments of an incubator company in the larger marketplace to be relevant, it can be a somewhat artificial reflection of the incubator’s success. Anecdotes of achievement are motivating for the sponsor and the other tenants, but we refrain from counting the lofty statistics generated by big winners as singular incubator triumphs. That line of thinking would identify the garages of Bill Gates and Steve Jobs as the world’s foremost incubators.

What’s the End Game: When Does a Startup Exit the Incubator?

It can be challenging to decide when a startup no longer needs the nurturing environment of the incubator-accelerator. Many incubator programs have prescribed cycles of engagement, but CCI has never maintained that rigid structure. Instead, we work with startups to recognize the time when the accelerator can become a launching pad. The variables that inform us typically include:

Size and growth trajectory of the firm relative to available physical space

Funding cycle and perceived need for support from the institution or incubator staff in raising more capital

Regional availability of affordable office space that supports the needs of emerging enterprises

Stability and quality of the startup’s leadership and governance

Intimacy needed with the sponsor institution—clinical trials, biomedical engineering, or medicinal chemistry expertise, for example

These are just some considerations for determining when a startup is ready to exit. We have never kicked anybody out; all exits have been logical decisions made by systematically monitoring key indicators, augmented by our gut feelings. It never fails—when one young startup flies the nest, there’s another coming in to take its place. Our incubator has been full since it opened in 2010, and we’ve completed plans for a second building merely blocks away.

What Can an Incubator Do for Local Economic Development?

Aside from the job creation that may accompany the physical construction of a building, incubators have unique potential for enhancing their local economies. Community economic development comes from growth of a regional innovation cluster and strengthened ties between the academic and business communities.

We are very proud that our incubator, the GCIC, was partnered with the Fairfax Renaissance Development Corporation (FRDC) from the outset. The FRDC is a nonprofit community development entity dedicated to new construction, housing rehabilitation, and community safety programs. It was a perfect fit to bridge the growing Cleveland Clinic footprint with an important historical neighborhood and its own economic development mission.

An innovation cluster benefits local economies by providing optimal environments for developing companies employing talented individuals. Typically, these are high wage earners, which translates into an increased tax base. The downstream spending by these recruits has obvious influence. The effect is multiplied when the fledgling companies finally spin off. Granted, some will follow investment dollars or seek special geographies that facilitate their next steps. However, the majority of companies will remain in the area where they were hatched.

Fostering more intimate relationships with the business community has multiple positive effects, including opportunities for cross-pollination of ideas and strategic investment. A secondary benefit for industry partners is the early targeting of talent and acquisition targets.

To date, CCI and its incubator have accounted for approximately 1,500 jobs. There are a number of indirect jobs accruing from the spin-offs themselves and the additional service providers that support them. We think this cycle of growth is just getting started.

A Cluster-to-Constellation Strategy, with Cleveland Clinic at the Core

It’s been a quarter-century since Michael Porter put forward the concept of the regional innovation cluster, the geographic concentration of interconnected resources focused upon advancement in a selected domain.³

Regional innovation clusters arise from core competencies and concentrated knowledge and resources. It’s logical that advanced ideas and improved processes would grow in such a cauldron. Potential participants and consumers alike are magnetically drawn to the maturing hub to fulfill needs and aspirations. Northeastern Ohio has become a cluster for medical innovation, with Cleveland Clinic as the nucleus.

What’s fueling this growth? Those desiring to practice medicine in a stimulating, collegial, and innovative environment are drawn like moths to a flame.

The center of the medical universe has always been where the patient and doctor meet—that’s why you can reach the pinnacle of your craft in places such as Cleveland or Rochester, Minnesota, home of Mayo Clinic. If you want to make movies, you need to be in Los Angeles. If you want to create wine, Napa Valley. But if you want to move the needle in healthcare, Cleveland is the place for you.

The economic impact is profound. Cuyahoga County, in which Cleveland resides, has the sixth-highest U.S. healthcare-related employment census and ranks third in job growth among the top hospital employment cities. Healthcare worker income increased by over $1 billion in the period 2000–2011.⁴ Cleveland Clinic alone accounts for nearly $13 billion of economic impact to the city and surrounding Northeastern Ohio region.⁵

Recalling that we’re emphasizing the value of place on innovation identity, two specific places warrant mention in our cluster discussion. First is the Cleveland Health-Tech Corridor, a three-mile swath east of downtown where biomedical, healthcare, and technology companies find close proximity to four leading healthcare institutions, four academic centers, and more than 130 high-tech and health-tech companies engaged in the business of innovation.

Along with Cleveland Clinic, you’ll find Case Western Reserve University, Cleveland State University, and University Hospitals Health System. The Greater Cleveland Regional Transit Authority’s HealthLine transit system moves patients and caregivers alike throughout this medical and innovation hub. Health-Tech partners have struck a harmonious balance between competition and collaboration. When it comes to advancing innovation, we’re on the same team.

The area is attractive to startups because of favorable rent, availability of support services, and proximity to institutions from which the fledgling companies emanated or to whom they are trying to sell.

The other noteworthy place anchoring Cleveland’s healthcare innovation cluster is the new Global Center for Health Innovation (GCHI). Part of an ambitious half-billion-dollar project that brought the city a world-class, 750,000-square-foot convention center, the “Globe” was initially conceived just as a medical showroom, the “Medical Mart,” and was the brainchild of Cleveland Clinic CEO and president Toby Cosgrove. The GCHI evolved to be the nexus of innovation, commerce, and education in healthcare.

Built with funds raised chiefly through a 0.25 percent sales tax in Cuyahoga County, the 230,000-square-foot GCHI became a physical manifestation of the region’s innovation legacy and future promise. It attracted giants of the healthcare commercial world, including GE Healthcare Systems, Philips Healthcare, and Siemens, alongside unique service and technology providers to healthcare, such as Johnson Controls and Forbo Flooring Systems. When the nonprofit HIT intra-operability organization Healthcare Information and Management Systems Society (HiMSS) signed on to take an entire floor, we knew we were in business.

Other organizations represented in the GCHI are healthcare delivery institutions, most notably Cleveland Clinic, University Hospitals Health System, and MetroHealth System, our county-operated, nationally recognized trauma and acute care hospital. Traditional competitors for patients became partners to advance innovation. There are providers next to vendors, all of us looking for ways to express and optimize our innovation identities. We moved our 2,000-attendee Medical Innovation Summit to the facility in October 2013. I chair the GCHI Executive Advisory Council, and we’re constantly seeking ways to leverage this singular asset to further the work we all do to bring creative thought to market to improve and extend human life.

Beyond the Cluster

As Cleveland Clinic closes in on its centennial, now a burgeoning international organization having opened a four-million-square-foot hospital in Abu Dhabi in April 2015, we are still “Cleveland’s Clinic.”

Clusters are the logical environments for breeding and sustaining innovation. They take respective needs and contributions and turn them into collective successes. They are catalytic and multiplicative. They are also fragile—their survival is not ensured, even when it seems like sustainability is a given.

One of the key ingredients that keep the cluster vital is the academic nucleus. Whether an AMC or research university (or both), the contributions to human and intellectual capital fuel the engine of cluster-based innovation. We need to build the concentric circles around these assets, adding commercialization capability, industry partnerships, and investor interest.

Also vital to the equation is public-sector participation. There’s often a lamentable disconnect between policymaking and the generation of functioning clusters. This divide may be more a function of coordination and communication, rather than lack of cohesion. In fact, the cluster concept could, and should, be catalytic in synchronizing the stakeholders vertically and horizontally.

Policy makers from the local to federal level should grasp the concept and adopt strategies that foster innovation, while providing favorable conditions to attract business. Responsibility for cluster creation does not rely on the public sector alone. Rather, cluster creation is a dynamic interplay between the private and academic sectors set in a dynamic environment. Public involvement lowers barriers for the tenuous, evolving innovation cluster.

“What’s next?” is perhaps the most frequent question asked by an innovator or entrepreneur, as well as business leaders and elected officials. Is the cluster the ultimate physical expression of innovation capability and potential? There is at least one more concentric circle that may surround and unify clusters. I can think of no more fitting term for a community of innovation stars than a constellation. What CCI has done to link institutions in the GHIA can be supersized.

We’re continuously seeking creative resources and culturally aligned organizations that can work together to solve big problems for large populations. We’re continuing to pioneer platforms for partnership that erase previous boundaries of competition and replace them with collaborative interaction.

A constellation could be a powerful cluster of clusters, where those dedicated to healthcare innovation can tackle the problems of access, quality, and cost together. Better yet, healthcare clusters could seek interaction with the engineering, computer science, advanced manufacturing, clean water, and energy clusters, to name a few, and cross-pollinate on an industrial scale.

Innovation is a tangible discipline. As such, it requires a home address. That home can be as narrow as the space between the ears of a creative thinker or as expansive as a global network of virtually linked innovation clusters. I’m an advocate for putting up four walls to house and protect innovation. Building a physical manifestation that demonstrates innovation’s importance to those who work inside and those who pass by is an inflection point in the genesis of any successful innovation function.

When you finally get those walls erected, just be sure you spend the rest of your days breaking down any barriers they may create and continually looking outside them for good ideas and good partners.