GE needs the data analytics minds of the Valley (and knows it)

The massive jet engine that GE (s GE) propped up next to the stage at its Minds and Machines event on Thursday morning, in the Dogpatch area of San Francisco, was symbolic of a few things for GE. It’s the kind of old-school technology that GE makes, but which it wants to increasingly add software and analytics too; it illustrates GE’s willingness to spend a lot to make a splash in the startup-rich region; it’s also a technology which is pretty alien to the multitude of web and mobile startups that call the San Francisco, Bay Area home.

The latter is the gap that GE is looking to bridge. GE is hoping to increasingly embrace software, data and analytics startups, and convince the elite software architects of the Valley why using their skills to make money off of “the industrial internet” — GE’s term for a combo of the Internet of Things meets machines — is a good idea.

To get that message across, GE announced a competition during the event called “Industrial Internet Quests,” which calls on developers, data scientists and designers to make algorithms and applications that can increase productivity for the health and aviation sectors. Those are some of GE’s major customers.

“If you want the right 300 [software] people, you have to come here,” said GE’s CEO Jeff Immelt, in conversation with Valley pioneer and investor Marc Andreessen, to a room full of media, and startup execs. Andreessen called GE’s commitment to partner with Valley entrepreneurs and software engineers as “a big deal.”

GE has thousands of its own software engineers — 5,000 specifically, said Immelt — and a new lab that will focus on software in New York. But GE also wants to make equity investments in software and data startups and also is looking to make acquisitions. Though, Immelt said “I’d rather acquire the people than the companies.”

Andreesseen said while corporate venture capital investing has gotten a bad rap — or has delivered “stupid money” as Immelt joked — the process should be more about learning and making connections in the ecosystem, rather than making large returns.

Why does GE care or need the Valley’s best software minds? At the end of the day, it’s a way for GE to stay competitive and relevant and continue to extend its business beyond hardware. Immelt, who calls himself “a student of productivity,” said productivity starts with hardware improvements, but that’s not enough — you need software and analytics to add those extra productivity percentages, said Immelt.

And that’s where GE wants to make its future revenues from for its newly marketed “industrial internet.” The one percent efficiency savings for things like jet engines, rail roads, locomotives, and power plants will come from analytics. It’s not sexy — particularly compared to projects like the Jawbone UP, which Andreesseen (who’s a Jawbone investor) showed off during the discussion — but it makes money. And as a side benefit, also delivers planet-friendly energy efficiency.

Immelt’s main point of the morning? When it comes to analytics startups in the Valley: “we’re open for business.”