1. In its first three years of operation, Idealab recruited entrepreneurs to its incubator who had business experience, but who did not know much about the Internet. In about 300 words, explain what benefits Idealab was able to provide to these entrepreneurs and why the incubator environment was beneficial to them.
2. In about 200 words, analyze Idealab's 2000 decision to change its focus from being an incubator to merging its companies in an attempt to compete with Amazon.com. In your analysis, discuss whether the decision was a strategic error or just a case of bad timing.
3. In about 200 words, explain why you think Gross decided to devote Idealab's resources to the development of internally generated ideas in 2003. Be sure to consider whether this change will help Idealab succeed in the second wave of electronic commerce.
Bill Gross started his first company (a solar-powered device manufacturer) when he was 15 years old. After graduating from Caltech, he started a software company, GNP that he later sold to Lotus (the spreadsheet software pioneer that is now part of IBM). Gross had made a considerable amount of money and was interested in exploring better ways of getting ideas converted into profitable businesses. He became fascinated by the idea of business incubators about the same time he became fascinated with the business potential of the Internet. In 1996, he pooled some of his wealth with contributions from several partners to create Idealab.