Class 5

What role do governments and policies play in impacting startups? Are there ideal regulatory frameworks and networks relationships to nurture entrepreneurial activity?


Eve Lieberman, Laurent Crenshaw, and Patrick McKenna were in agreement that life cycle phase of a start up directly impacts how the start up interacts with government. In an early stage the entrepreneur is likely to be focused on gaining traction and devote no time to government relations. As a company grows in scale and manpower a dedicated government relations function is common. At this stage the entrepreneur is telling government that consumers are delighted and jobs are being created. In the final stage an entrenched company will use influence to perpetuate a competitive advantage. This life cycle view is consistent with accepted business model frameworks such as the product revenue over time graph shown below (from http://bdmclient.co.uk/sustaining-profitable-growth.php) or the Bass diffusion model.

These frameworks are product specific but a firm is equivalent to the sum of its products meaning that a start up as a whole follows a similar path.

What can government do to facilitate entrepreneurial activity? Is maximizing entrepreneurial activity an appropriate goal for government? The DeBlasio Uber story is instructive here. In a functioning democracy government is responsive to citizens. In a successful start up a company is responsive to client desire. As long as the client base is sufficiently large the goals of government and a startups are perfectly aligned.

What guarantees equality, justice, and protection of fundamental freedoms? In the US the Constitution addressed fundamental freedoms and transparency/a free press are tools that are capable of supporting justice. There are myriad forms of government in the global laboratory and the US may not have an optimal formula <http://www.theatlantic.com/business/archive/2012/10/think-were-the-most-entrepreneurial-country-in-the-world-not-so-fast/263102/>. I doubt that that on optimal form of government exist. I am glad there is a dynamic interplay between entrepreneurs and state.

STRT580 Startups Matter Class 3

#1

Blake Hall is founder and CEO of IDme. IDme is a company that provides online credential verification. Blake is a veteran and an entrepreneur. His company fills a void created by the inability of the US federal government to provide secure, mandatory, and verifiable identification for the citizenry. This failure is one of political will, not of technological limitation. This is where IDme comes in.

Blake is an Army ranger who served in Iraq in 2006-2007. IDme began life as troopswap.com a way for service members to e-verify their status and qualify for existing zero cost veterans benefits. From that point Blake realized there was a large underserved market for identity and cohort verification.

Blake is a successful entrepreneur because he recognized a political failing (inability to publicly e-verify citizenry) and found a market based solution. PRC has an RFID identification card that is integrated into the national transit system and serves over 900 million citizens. India has biometric identification mandates tied to wealth transfers to the poorest of its citizens.  Empirically, the problem IDme is solving is one of political honesty and the role of government not one of technology.  IDme is making a be that the federal government will continue the existing behavior of monitoring citizens digital movements without explicitly mandating a comprehensive identity solution. This gap provides a big opportunity for IDme to thrive in the foreseeable future.

Identification is critical to any successful city. Anonymity provides opportunity for criminal behavior that cannot be punished. Identity is accountability. In a smart city on the hill, privacy is dead, get over it.

#2

Tim, Ben, and Nicole presented non-market strategies for product (or service) success. To create a consumer market for a device capable of having a real positive impact on the US mortality rate a carbon monoxe detector manufacture chose to use nurses, doctors, and state legislatures to mandate the installation of their devices. An alternate path would have been to educate consumers so that each individual would see value in the choosing to install a carbon monoxide detector on their own. Consumer education is difficult, expensive, and time consuming but will increase maintenance (and thus effectiveness) of warning devices in the long run.

A theme from Tim, Ben, and Nicole was an acknowledgment that the existing regulatory environment is well intentioned and directed by people who are also well intentioned. Impact can often be maximized by working with these regulators to highlight the positive outcome for consumers or citizens that the new technology brings. 

STRT 580 Class Two

What role does entrepreneurship have in the world? Entrepreneurship can bring about creative destruction. As can famine, flood, global warming, misaligned policy. David and Logan both hope to use s market mechanism to capitalize on inefficacies in the energy and health care sector. The energy sector, the health of the planet as we know it, and Aquicore would benefit from a direct carbon tax. Dorsate would benefit from an alignment of the outcome of care and the direct cost to the consumer receiving medical aid. Healthcare as a right makes this more difficult to achieve bar moving towards a two tier system.  

How can entrepreneurship solve problems in regulated industries? Regulated industries should be regulated to maximize the utility of the population while protecting fundamental rights. In this way a reasonable citizenry could be convinced that pricing the negative externality of carbon dioxide emissions would benefit future generations.

Michael Chasen is the founder of Blackboard. He exited after a $1.64 billion buyout by Providence Equity. Founded in 1997 Blackboard survived the dot come bust because it was already cash positive at that time. Chasen realized early on that to successfully sell to institutions Blackboard had to have the corporate strength of a positive balance sheet.

Chasen knew the higher education market from his work at EY. He founded Blackboard with his college roommate. Blackboard grew by proving services to key university partners for zero cost in exchange for positive reviews to other schools. This word of mouth network proved effective as blackboard developed a pricing model.

Chasen was the CEO of Blackboard when it served over 30 million students and was used by 80% of top colleges. Blackboard gives students access to data and teachers a platform. Presently Chasen is working on a location based consumer mobile application.

Chasen’s experiacne can help disrupt city services by creating a population that assumes direct digital access to information is inherent to a social system. Young citizens expect a city to provide data through a web based platform.