Not hearing much talk about corporate innovation these days, eh? Most of the talk is about retrenchment and fortifying and strengthening the core, given our economic malaise.

Interestingly, when times are good, corporations often assume that the good times will continue, so let’s keep doing what we’ve been doing that got us here — essentially, fortifying and strengthening the core. Innovation is a bit more talked about in the good times because there is money to spend on it, but it often is just talk.

This focus on fortifying and strengthening the core in the good AND bad times is the Innovation Paradox. Essentially, innovation is often caught in a weird Bermuda Triangle, perennially underappreciated (despite the talk) and under-invested in.

Without going into the appropriate way to structure an innovation effort (the subject of many other potential blog posts), let’s take a look at what finance can do to help.

Finance sits at the nexus of a great deal of information (operating and financial data) within the company. Depending on the nature of your industry, finance can and should provide an understanding of how much of the company’s revenues and profits are coming from products and services launched in the last 1, 3, 5, etc., years. Note that the duration will change based on your industry’s dynamics (product life cycles, time to launch, etc.), but essentially the idea is to see how much of your organization’s revenue and profit is coming from innovation. If a heavy majority of the company’s revenue is coming from products and services not launched in the last X years, this is direct evidence of underinvestment in innovation. Remember that what got you here will not get you there. more

Josh Kopelman of First Round Capital put up a great quick website promoting the idea that technical talent (meaning those who know computer stuff) may want to consider a start-up given the mess the banks and financial services are in. The site’s master-of-the-obvious title is Leave Wall Street — Join a Start-up.

Below, I’ve posted his points, which make a lot of sense and which would help “diversify” NYC’s economy a bit — although this would take many, many years. I remember the days of Silicon Alley (up to year 2000) as I worked at Kozmo.com. Unfortunately, no significant businesses emerged from that as far as I can gather. But here’s to hoping a Google can emerge out of NYC.

Financial services will always be huge in NYC, but introducing some other types of economy into the mix would only be healthy. Remember, diversification is good. The politicos seem to agree as well, having recently started NYC Seed — an angel investment fund giving $200k to worthy business plans.

For those who aren’t familiar with Kopelman, he is best known for starting Half.com and selling it to eBay for $350 million.

Those who visit the site will also see that Kopelman has posted positions at some of First Round Capital’s portfolio companies as well. So besides making some good arguments, Kopelman has also found a good way to promote his companies and his interests in them. This is very smart.

Here’s to the new NYC start-up scene. Kopelman’s comments are below: more