Samsung Opens New Innovation Center in Silicon Valley
MENLO PARK, Calif. — Samsung, which started out in 1938 as Samsung Sanghoe selling groceries—even making and marketing its own noodles—before diversifying and moving into the TV business in 1965, hasn't become one of the world's largest consumer IT device makers by not doing things the right way.
Although it hasn't been known for inventing products, Samsung has built a reputation—and a multinational presence—by refashioning conventional products into its own versions. Examples of this include ultrathin television monitors and Android smartphones.
Realizing that innovation usually happens elsewhere, the South Korea-based conglomerate is putting some serious investments into creating new products and services by establishing an investment fund and an innovation center in Venture Capital Land—the well-known Sand Hill Road row of offices here in Menlo Park.
Strategy, Innovation Center Now Open for Business
On Feb. 4, the South Korean company offered more details about its Samsung Strategy and Innovation Center (SSIC). Chief Strategy Officer Young Sohn told a group of journalists that the center actually has been open since August 2012 and is a center where Samsung's nine product divisions are channeling Silicon Valley's entrepreneurs to help it fill gaps in its product lines as the company moves into the post-PC era.
Sohn said the SSIC will have its headquarters in Menlo Park but eventually will establish other offices in other global innovation hot spots. The SSIC is currently inviting a number of fellows to join the center to conduct research, providing funding for other entrepreneurs, and mentoring and/or incubating others. Sohn, however, wouldn't say how many people will be based at the SSIC.
"We want to be clear," Sohn said. "We're not an incubator. We provide a wide range of services and benefits to those 'idea people' we think would be good for Samsung."
Many Types of Services Offered
However, the SSIC does, in fact, offer office space, office services and professional mentoring to selected startups. It's just not the only thing the center does.
SSIC is a place where entrepreneurs are building partnerships with Samsung's nine product divisions as they seek to develop their own ideas and turn them into products.
Alongside the SSIC, Samsung launched a $100-million Catalyst Fund designed for early- and seed-stage investments. This will complement Samsung's $1 billion corporate venture fund, which Sohn said has been ramping up investment in the United States.
VCs Can Do More Than They Have Been Doing
"We think venture capital is not doing all of what we're looking to see in early-stage companies," Sohn said. "There is hunger for supporting entrepreneurs, academics and artists so they can get their wind behind them. We want to make sure we help that process."
While Samsung long has been one of the world's largest consumer IT companies, its reputation as an innovator has been hit often by litigation. Apple, in recent months, has accused the company of stealing its designs and technology, the subject of multiple patent legal disputes around the world.