Scott Case says the growth of startup companies is what drives all job creation in America, and is the key to revitalizing our economy.
Case is CEO and board member of Start-Up America Partnership, a public-private partnership with the Whitehouse focused on helping young companies grow.
Smart Business sat down with Case at the 2011 Ernst & Young Strategic Growth Forum to discuss how individuals and organizations can engage with startups to help them succeed.
What challenges do startups face in the early stages?
There’s a huge difference between young, ambitious startups and small companies. And the institutions and the members of the broad startup ecosystem that engage with startups — whether they’re active or passive participants — need to recognize this category of company.
Now the challenges that (start up founders) face are the same challenges that every entrepreneur has ever faced. … They fall into basically five core categories: they need expertise, they need to develop a network of mentors and advisors and people who can help challenge their assumptions and to help them to make better decisions; they need to have support services, that’s the lawyers and the accountants and the back office people that when they get it right it’s invisible and when they get it wrong it can be disastrous; talent, they need to select just the right people, so those early first employees are critical to their long-term success; they need to really focus on who their customer is and understand their relationships with customers and develop those customers; and finally, they need to understand capital.
I always put capital last because first-time entrepreneurs often put it first, and it’s almost always the case that those other four things aren’t developed well enough yet before they’re going to be able to get that capital investment.
How can entrepreneurs engage with startups?
We need you in these start-up ecosystems, in these communities. Engage in your local start up businesses. That might mean looking up what the local lean start movement meet up is, the tech meet up that’s happening, a local conference that’s focused on companies and startups – engage and participate. Just showing up, especially if you’re successful and you’re recognized in your local communities as a successful entrepreneur, just being there is an inspiration to these folks. And you’ll be inspired yourself because these young entrepreneurs, these young companies — first time founders, second time founders who are creating these great companies — they’re energizing.
The easiest thing to do is look for startups in your local geography and take one of them to lunch and offer to help. Give them your sage advice, help them make new mistakes and avoid the ones you’ve already made. It’s a great opportunity for you to participate.
How does your organization help companies find expertise?
One example of a partner is an organization called Start-Up Hire. … You can join Start-Up America and get access to Start-Up Hire, which allows you to post jobs. But it’s totally focused on people who are looking to join startups – which again, is a very different class of people. The person that puts their resume up on Monster.com is not necessarily thinking about joining a startup. They’re a different breed of people we call starters who join founding teams, because founding teams are generally populated by total maniacs who are attacking some market that didn’t exist until they came up with it.
Another example is we created something called a Start-Up Corporate Connection. Corporations in America have entire engines for recruiting the best talent. If you’re a fourth runner up to three positions at a company like General Electric, you’re probably highly qualified. You might not consider a start up or you might not even be aware that there’s start ups around you.
And then finally, … we’re basically partnering with serial entrepreneurs in places … to create these vibrant startup communities that not only bring the startups together, but then attract and create mechanisms for talent. And one of the greatest forms of talent in those regions are universities. It’s an absolute tragedy that young people come and they fly all the to go to school … to spend four years and then they leave. What a great missed opportunity to connect them with the startup communities there.
How can you tell which entrepreneurs have the perseverance to succeed?
You generally have a track record. It’s pretty measurable. Did you have a company that succeeded or didn’t you? And that doesn’t mean that it’s a success or failure model, because mistakes and failures are made.
You may have stumbled along the way, a competitor might have eaten your lunch, you may not have been able to raise capital – but you learned something from that.
HOW TO REACH: Start-Up America Partnership, www.startupamericapartnership.org