Tag Archives: Canada

Entrepreneurship: Our Future.

What to do about entrepreneurship.

A lot of people agree that entrepreneurs and the resulting startups that they foster are the heart and soul of future economic and innovative growth in the United States and the world.

Here are the current administration’s efforts to spur entrepreneurship. Recognizing that startups are the engines of job creation, the Obama presidency has started a Startup America initiative and has come out strongly in support of the Crowdfunding component of the JOBS act. And it has acknowledged that “it is the entrepreneurs in clean energy, medicine, advanced manufacturing, information technology, and other innovative fields who will build the new industries of the 21st century, and solve some of our toughest global challenges.”

In January 2011, President Obama called on both the federal government and the private sector to dramatically increase the prevalence and success of entrepreneurs across the country. In the year since launch, the Obama Administration rolled out a set of entrepreneur-focused policy initiatives in five areas:

Unlocking access to capital to fuel startup growth

Connecting mentors and education to entrepreneurs

Reducing barriers and making government work for entrepreneurs

Accelerating innovation from “lab to market” for breakthrough technologies

Unleashing market opportunities in industries like healthcare, clean energy, and education

Have we not heard all of this drivel before? Does this sound like a commercial for your government at work or what? And, not only does this “initiative” NOT HAVE ANY LEGISLATIVE SUPPORT IN CONGRESS, but it has been handed off to the Small Business Administration and the Veterans Administration, two agencies that have elevated the fine art of bureaucracy to the Masters level. Just ask anyone who has applied for an SBA loan, or a returning veteran simply trying to get the benefits we contractually owe him. There’s really nothing more to say about this.

How about this one:

Leaders in the private sector launched the Startup America Partnership in 2011, an independent alliance of entrepreneurs, corporations, universities, foundations, and other leaders, joining together to fuel innovative, high-growth U.S. startups. Within just one year, the Partnership has mobilized to make over $1 billion in business services available to a national network that will serve as many as 100,000 startups over the next three years. This sounds ominously close to my plan to end the great recession, doesn’t it?

Their intent is to support the growth of startups in five key areas:

Expertise: Connect startups with training, mentors, advisors and accelerators

Services: Provide startups with access to critical services at reduced costs

Talent: Assist startups in recruiting, training and retaining the people that can help them grow

Customers: Help startups through acquisition of new customers and expansion into new markets

Capital: Highlight sources of capital available to startups in various regions and sectors

In addition to the product and service focused offerings, Startup America firms gain access to Connection Programs which provide unique opportunities to connect with thought leaders, major corporations (as partners or customers), customers, and more.

This sounds really good, but then why does it feel like a giant bureaucracy? Because it is.

Their sponsors are American Express, Microsoft, Dell, Intuit, American Airlines and the New York Stock Exchange. Does this sound like fleet of foot, startup incubators ready to make split decisions based on squiggles on the back of a napkin, just like they did to get started years ago? NOT.

Wouldn’t it be so much better if the sponsors were Twitter, Google, Facebook, eBay, Pinterist, LinkedIn, or even Salesforce?

And wouldn’t it be more promising if their “team” wasn’t composed of a CEO of a national staffing firm who sits on the boards of Comerica and Kohl’s? Or Fred Smith, the CEO of FedEx? Or Magic Johnson, an NBA basketball player, or Tory Burch, a fashion designer for Ralph Lauren who leveraged her relationships in the fashion industry and personal financial strength to become a leader in global lifestyle brands?

To be fair, they have Reid Hoffman, Reed Hastings, Michael Dell, Steve Case, Lynn Jurich and Kevin Plank on their team as well, but I think all of these guys have pretty demanding day jobs. Who actually runs the joint?

I think the Canadians might have a more realistic view: Their view is that entrepreneurs and small businesses are the backbone of the Canadian economy. There are more than 1 million small businesses that employ 48% of Canada’s total workforce, account for 25% of total exports, and provide 30% of their total GDP. Of those small businesses, only 4.7% are classified as high-growth enterprises, yet are responsible for 45% of new job creation in Canada.

The Canadians recognize that entrepreneurship is a powerful force for driving job creation, innovation, economic growth, and for fueling healthy and sustainable communities. Governments around the world are responding to shifts in global markets by strengthening the domestic climate for entrepreneurs as a way to ensure economic growth and prosperity. The launch of Startup America, Startup Britain and similar private-public-civil society initiatives in 2011 has contributed to entrepreneurial growth in more than a dozen countries worldwide.

In Canada, the local movement has only just begun:

  • The government of Canada declared 2011 as the ‘Year of the Entrepreneur’, recognizing the critical role of entrepreneurship in securing Canada’s ongoing economic recovery and prosperity;
  • The ‘Review of Federal Support to Research and Development’ Expert Panel Report, spearheaded by Tom Jenkins, Chief Strategy Officer of Open Text Corporation, called for action to unleash the potential of Canadian entrepreneurs through innovation;
  • Action Canada released ‘Fuelling Canada’s Economic Success: A National Strategy for High-Growth Entrepreneurship’, calling for the creation of a central enabling organization with the mandate to fuel high-growth entrepreneurship in Canada; and,
  • The Coalition for Action, C100, Startup Visa and other organizations in the innovation and entrepreneurship community, put forth proposals and recommendations for action to strengthen innovation and entrepreneurship in Canada.

While Canadians like to think of themselves as great collaborators, the Canadian entrepreneurship community hasn’t come together yet around a shared vision or purpose. Canadian entrepreneurs are struggling to navigate a complex and highly fragmented enterprise ecosystem, which creates challenges for entrepreneurs to identify and access support, build and leverage national and global networks, and limits the capacity to share knowledge and best practices. An absence of adequate risk capital, combined with a shortage of management and business skills normally fostered through startup failures and second- or third-attempts, contributes to Canada’s overall deficiency in “entrepreneurial culture”.

What is needed most urgently, as recommended by Action Canada, is a national strategy to bring together the collaborative efforts of the entire entrepreneurship community to create more favorable conditions for entrepreneurs to flourish. Without a strategy, Canada will continue to trail international competition and risk economic recovery and long-term prosperity. And so will the United States.

The solution begins with a grassroots, entrepreneur-led movement to bring together Canada’s national entrepreneurship community to create a clear vision and strategy that leads to real change and action. And, that is a blueprint for the United States as well.

We don’t need a presidential initiative that is not supported by Congressional legislative action, nor do we need the outcomes to be administered by the SBA, or God-forbid, the VA.

What we need is money, a National Initiative supported by an ACT OF CONGRESS, and the full time attention of successful entrepreneurs and venture capitalists (often the same thing) to insure that a working infrastructure gets created to support several hundred thousand entrepreneurs in the pursuit of innovation.

This working infrastructure needs to be regional, and centered around Universities with proven track records in fostering innovation. VCs jokingly tell anyone who will listen that the reason 80% of the country’s Venture Capital firms are located on Sand Hill Road in Menlo Park is because it is an easy commute from Woodside, Portola Valley, Palo Alto, Los Altos Hills and Atherton. Location matters. This means Stanford, UT Austin, UW in Seattle, NYU in New York, MIT in Boston, Carnegie-Mellon, Berkeley, etc.

All of the functions that entrepreneurs need to operate need to be in place. Human Resources, Payroll, Accounting, Payables, Receivables, Legal, PR, Advertising, Sales and Marketing Leadership, Engineering and prototype Manufacturing. Let the founders focus on their big idea and let the staff do what they do to keep the lights on, while capitalizing on economies of scale to reduce costs.

 

All of this infrastructure, as well as the seed capital will be provided by the Federal Reserve. If there was ever a better justification for creating money out of thin air, I don’t know what it was. Certainly not the $9 Trillion gift to the 6 biggest investment banks in the US in 2010. Nor the $800 Billion TARP bailout in 2008. No. This will actually create jobs, jack the economy, reduce unemployment below 5%, fund Medicare and social security for a hundred years and probably solve 5 of the world’s most pressing problems within 5 years.

 

Imagine a modern “Manhattan Project”:

Cheap, sustainable and renewable, non-carbon energy

Practical synthetic biology at the cell level

Cures for all forms of cancer

Automobile battery technology that enables 1,000 miles between charges

Complete bio-robotic drug delivery systems

YES!

One model that will work is to rotate VCs in and out of the board governance and mentoring responsibilities. These guys should be willing to volunteer as a matter of public service and they should also be allowed to invest in subsequent rounds. VCs don’t need orientation. You’ve sat on one board, you’ve sat on them all.

 

But, the real key is Congress. They need the courage and strength to enact laws that allow a small group of people to navigate around existing agencies and government infrastructure to create an initiative like this and to drive it through to formation and execution.

 And, if you care about this, you could help make it happen. Write your Congressperson. I know this sounds lame, but I know of no other way to start the sausage going. I have, and will continue to do so. The Crowdfunding bill got done the same way. Honest.

 

 

 


The Price of Gas, and a Reasonable Man.

Someone named Winghunter, called me Stevey and referred to my post, “Gas Prices Go Up Under Obama. Really?” (sic) with disdain, citing about 10 stories relating to the Obama Administration’s efforts to stop drilling for oil here in this country, and his opposition to the pipeline project which would of course, “create tens of thousands of jobs.”  He then assumed I am a left wing radical and closed his rant with “not expecting to hear from you” or something along those lines. Well, Winghunter, you SHOULD expect to hear from me,  and here it is.

To your surprise, I am not a left wing radical. I am actually a capitalist and a member of the 1% club. I voted for Reagan, Bush, Bush and Obama

I voted for Obama because he is a reasonable person (as my partner Tim Handley would say) and a really cool guy. This was after 8 years of being embarrassed by a really un-cool guy. I voted for Reagan and the Bush’s because I thought they were the best chance I had at protecting my earnings and keeping the tax rate the lowest. I was right. And, I was wrong.

I was raised in an Irish Catholic and Jewish household by parents who couldn’t be more opposed when it comes to politics and business. My Mother had worked hard at being a secretary to officers of the US Navy and finished her career as secretary to the base commander at Hunter’s Point Naval Shipyard in San Francisco. She was a self-described Jew, daughter of Hungarian immigrants, a conservative Democrat and capitalist. My father was the 12th child of Irish-Catholic immigrants, drove Yellow Cab in San Francisco for 38 years, was a Teamsters Union steward and thought of himself as a liberal Democrat. From the time I was old enough to remember, we had animated discussions over dinner, about politics, race, religion, taxes, education and movies.

My Father hung with a group of guys who drove cab like him. French, Irish, Albanian, Italian, Spanish, Portuguese and Greek. No African-Americans allowed. They drank and smoked and shot pool and mostly liked working the night shift. My Mother hung with me. I grew up thinking that she was mostly right and he was mostly wrong.

I attended a Catholic elementary school (Our Lady of Angels) and a Catholic High School (Junipero Serra). I met my first African American at UC Berkeley. My Mother held a severely racist view of African Americans based on her experience managing “Negroes” at Hunter’s Point. She didn’t like Italians much better, and we never ate “Italian food”. Whether her stories were true or not, I walked out into life with roughly the same prejudicial inclination. It took ten years for me to lose the prejudice. I think I was lucky.

Somehow, my high school girlfriend became impregnated, so I had to turn down an appointment to the US Naval Academy that my Mother had worked hard to get me, and marry her. This did not make my Mother happy. Just to really slam it to her, I married an Italian later.

Me – Summer of 67

My first exposure to public protestation occurred when Mario Savio held free speech rallies on the UC Berkeley Campus during my freshman year. Our country was just getting going for real in Vietnam, but I was granted a 3A draft status because I had 2 children at the time, and was unable to participate. A couple of years later, the Chicago riots over the Vietnam war turned our National attention to the voice of the people, while Bobby Kennedy got shot and killed and the Summer of love kicked off the hippie movement in San Francisco. By this time, I had developed a social conscience and participated in all of that, including Woodstock a few years later. Divorced by then, I lived in a communal home in Los Altos Hills. An oxymoron, I know. But, through all of that, I never quit my job in the “establishment”.

Like almost every other Californian my age, I hated Ronald Reagan when he was Governor, but managed to get over it when I was making $250,000 a year in 1972, and voted for his second term. Someone once said that if you weren’t a liberal when you were in college and aren’t a conservative when you were in business, there was something wrong with you. But, that didn’t exactly apply to me.

The view that I have always held was tempered by the question, “What would a reasonable person do or think under these circumstances?” And, I think I owe this to watching and listening to my parents “debate” issues over dinner. Neither one of them was ever reasonable. It was sort of like watching John McCain argue with Nancy Pelosi. Though, my Mom and Dad were more articulate.

Was I a proponent of the power to the people movement in the 1960s and 70s? Sure. I saw then, just as I see now, a disproportionate distribution of attention, power and leverage to a small group of individuals at the expense of an increasingly disenfranchised majority of Americans. Nothing has changed in the way our government manages its business. Make love, not war? Give peace a chance? Of course. Was I a proponent of the hippie movement? Absolutely. Drugs and sexual freedom seemed like a great idea in 1967. Catholic, all male high school boy gets key to the city. Now, not so much.

So, here’s the deal Mr. Winghunter:

First fact, the POTUS has almost no control over the price of gas at the pump. Fact. Mr. Gingrich needs to stop it.

Second, if he agreed to go along with the Keystone pipeline from Canada to Texas, the bulk of that oil ends up being shipped to other places and it would have almost no effect on the price of gas at the pump. It would not create tens of thousands of jobs either (an independent study conducted by the Cornell ILR Global Labor Institute found that the Keystone Pipeline would result in 2,500 to 4,650 temporary construction jobs). It also crosses an active seismic zone and is the dirtiest source of transportation fuel currently available. The proposed route additionally crosses the Sandhills in Nebraska, the large wetland ecosystem, and the Ogallala Aquifer, one of the largest reserves of fresh water in the world. The Ogallala Aquifer spans eight states, provides drinking water for two million people, and supports $20 billion in agriculture. A leak could ruin drinking water and devastate the mid-western U.S. economy.

Third, The price of gas at the pump is affected mainly by commodity futures trading. Yes, the same 27 year-old MBA gamblers in pin-stripes and yellow neckties who took the economy down. Supply and demand, taxes, transportation, cost of crude, refining margins and competition make up the rest of the equation. Are the oil companies making a huge profit. Of course, and why not? As long as we stay stuck on this insane dependency on oil, they will continue to make huge profits.

So, commodity future trading based on the current supply in terms of output, especially the production quota set by OPEC, is the biggest single impact on the price of gas at the pump. If traders believe supply will decline based on say, threats to the straits of Hormuz, or a war with Iran, they bid the price up. If they believe supply will increase, the price falls. Another influence for traders is Oil reserves, including what is available in U.S. refineries and what is stored at the Strategic Petroleum Reserves. These reserves can be accessed very easily, and can add to the oil supply if prices get too high. Saudi Arabia also has a large reserve capacity. If it promises to tap those reserves, traders allow oil prices to fall. The last influence is Oil demand, particularly from the U.S. Demand usually rises during the summer vacation driving season. To predict summer-time demand, forecasts for travel from AAA are used to determine potential gasoline use. During the winter, weather forecasts are used to determine potential home heating oil use.

And, those are the facts, Mr. Winghunter. Facts. Not my opinion.

Mr. Obama is a reasonable man, has a great singing voice, is the ultimate in cool, has done a really good job of trying to lead this dysfunctional country during a time of unprecedented economic disaster, and I intend to vote of him again this November because I know that he will continue to resist terrible ideas like the Keystone Pipeline. As any reasonable man would.

Based on your call sign, Mr. Winghunter, I would guess you are a bird hunter, and like my brother-in-law, a proud owner of a large cache of guns and ammo. I have nothing against that and I applaud your ability to do so, but when the neighbors took me hunting when I was 10 years old, and I had an 8 point buck in my sights at 20 yards, I couldn’t pull the trigger. I personally don’t think it is reasonable for men to kill other living things when it is not necessary for survival. Just my view. Enjoy your day.


Auto Financing in Canada on AutoTrader now Provided by CommunityLend.

This began in early 2011.

Every private auto listing on Canada’s largest used car marketplace, AutoTrader.ca includes a financing option provided by CommunityLend.

 

Screenshot of CommunityLend auto financing on AutoTrader.caThe AutoTrader.ca + CommunityLend collaboration includes a contextual financing calculator integrated into the gray price box about halfway down the page.

Canadians are accustomed to shopping for cars based on monthly affordability, rather than total purchase price, after being conditioned by new car manufacturers who have marketed cars that way for more than a decade. Now Canadians can shop private auto listings that way too.

By “every” private listing, they mean every listing in Ontario under $25,000. They will soon expand the program to other provinces, and to higher priced cars & trucks.

To put the scale of this partnership into context, the volume of private auto listings is over $6 Billion per year in Canada. (This does not include used car dealerships, just individual sales.) No one has ever offered a comprehensive financing solution to meet the needs of these car buyers and sellers until now. Another interesting application of social lending in action.


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