Working Toward “Zero Barriers” for Entrepreneurs

“After a long Great Recession hangover, entrepreneurship is finally rebounding in the United States. Entrepreneurs are driving a resurgence of business activity in America.” – Kauffman Foundation “Zero Barriers” Report

The Kauffman Foundation recently released their “State of Entrepreneurship 2017” Report noting a resurgence of entrepreneurship in the United States after a long-term decline. The report sets out several areas of growth key to ensuring entrepreneurship continues as an economic driver for all, first of which is a focus on women and people of color. The Case Foundation’s “inclusive entrepreneurship” movement focuses directly on democratizing entrepreneurship, through collaborations and learning opportunities with ecosystems and founders committed to reducing barriers to entrepreneurship faced by diverse entrepreneurs, and scale local pilots into national programs serving women and entrepreneurs of color. As we are on the same path, we are proud to have a partner like the Kauffman Foundation alongside us in the movement for inclusive entrepreneurship. At the core of our movement building philosophy is partnerships. We look to combine our strengths with those of our partners in the field to accelerate and catalyze progress toward a common goal. In the entrepreneurship arena, the Kauffman Foundation has long been one of those partners. From our early partnership in Startup America Partnership to today’s on bringing intentionality to leveling the playing field for all entrepreneurs through their Zero Barriers initiative.

Created with Ewing Marion Kauffman’s own entrepreneurial values at their core, the Kauffman Foundation has been a champion in fostering entrepreneurial communities and expanding entrepreneurship education programs in startups across the country. At the 8th Annual State of Entrepreneurship Address in DC on February 16, Kauffman President and CEO Wendy Guillies discussed how entrepreneurship has evolved, outlining current trends, barriers and opportunities for growth. The annual address was structured around the release of a new Kauffman Foundation report, highlighting three mega trends that are redefining the future of entrepreneurship in the U.S. However, the event and the structure of this report are not merely an assessment of the entrepreneurship field right now; rather, the Kauffman Foundation used this report to launch a new focus and dedication to their entrepreneurship work. The three mega trends from the report reflect changes in demographics, geographies, and approaches in entrepreneurship that Kauffman articulates as vital to address in their work and the work of others in this space. Identifying the gaps within each mega trend, the report serves as a strategic roadmap for engagement and a call to action and paves the way for the new “Zero Barriers to Startup” Initiative—a collaborative, nationwide effort to remove traditional barriers to entry for startups and empower entrepreneurs to pursue innovative ideas.

Mega Trend 1: New Demographics of Entrepreneurship

The entrepreneurial ecosystem is expanding and evolving, yet opportunity and empowerment divides across key demographics—particularly women and communities of color—have prevented entrepreneurship from being truly inclusive. While more than half of the U.S. population will be from communities of color by 2050, this trend is not accurately reflected in today’s composition of entrepreneurs. Historically marginalized and underrepresented communities often face higher barriers to entry, including lack of access to and cost of capital, which have implications on business profitability and opportunities to achieve scale. The report brings valuable data to this space, indicating that the average size of mature, non-minority-owned businesses is valued at $2.3 million in annual revenue, while those of similar size and growth stage owned by minorities are only valued at $1.6 million. Additionally, the entrepreneurship diversity gap comes at significant economic costs—if minority-owned businesses grew at the same rate as those of non-minorities, the U.S. would have more than one million additional employer businesses and as much as 9.5 million new jobs. Through initiatives like “Zero Barriers” and ongoing grants to women and minority entrepreneurs, the Kauffman Foundation joins the Case Foundation and the inclusive entrepreneurship movement to level the playing field and promote innovation across demographics.

Mega Trend 2: New Map of Entrepreneurship

Beyond the traditional hubs of the Silicon Valley and Boston, emerging startup ecosystems are forming across the country, particularly in mid-size metro areas. As we have seen through the Forward Cities collaborative in Cleveland, Detroit, Durham and New Orleans, innovations in technology and innovative financing models have unlocked new sources of capital and created pathways for entrepreneurs to scale their businesses. However, the entrepreneurial landscape is still a geographic patchwork—pockets of growth are largely concentrated in urban areas, while rural communities have experienced a drop in startup activity from 20 percent in the 1980s, to 12.2 percent today. To mend the urban-rural divide and promote geographic diversity, Kauffman Foundation’s “New Map” initiatives will focus on empowering entrepreneurs at the local-level and addressing the barriers to entrepreneurial growth among rural communities. We look forward to sharing the lessons we have learned through Forward Cities and the joint lessons of Startup America Partnership to ensure that entrepreneurs from across America have the opportunity to contribute toward America’s progress.

Mega Trend 3: New Nature of Entrepreneurship

The third mega trend informing the current state of entrepreneurship is tied to the evolving nature of the industry itself, and the unique role that technology has played in redefining the field. Leveraging technology in business development has spurred entrepreneurial innovation, created new markets in traditional industries and aligned financial and social incentives in new ways. While technological advancements make entrepreneurship more widely accessible, it has also had the dual effect of slowing net job creation across sectors. Kauffman shared an interesting snapshot comparison to bring this point home:

Technological disruption and increased automation has reduced demand for human capital, which could accelerate the growth of startups and early stage companies. At the same time, technology is only as powerful as those who invest in, adapt and successfully integrate it into their business practices. Moving in lockstep with advancements in technology, Kauffman is launching new educational models for entrepreneurship and identifying new opportunities for job creation.

While often reports can raise as many questions as they do solutions, the Kauffman Foundation’s Zero Barriers response will provide valuable resources and support for entrepreneurs and ecosystem builders across the country. The mega trends that the Kauffman Foundation identifies, particularly the new demographics and new map, are ones that the Case Foundation is specifically targeting through our inclusive entrepreneurship movement. The Case Foundation is honored to have the Kauffman Foundation as a partner in the movement to create a more inclusive approach to entrepreneurship.

#FacesofFounders Featured Stories—Just the Tip of the Iceberg

Today we released the fifth and final featured story from our #FacesofFounders campaign. Launched in October and culminating today with the final story, #FacesofFounders seeks out and lifts up America’s dynamic, diverse entrepreneurs who are key to driving innovation and job growth. These five entrepreneurs stood out for their groundbreaking work, inspiring journeys and ability to shatter stereotypes through their commitment to inclusive entrepreneurship.

As we celebrate these five founders, we are reminded that they are just the tip of iceberg. The #FacesofFounders campaign received nearly 750 compelling and inspiring stories of entrepreneurship occurring all over the country, led by founders from all backgrounds. And we know that this is only a small subset of startup activity happening in communities from Maine to Arizona, Washington to Mississippi. These five entrepreneurs are ambassadors of the enormous stock of talent that exists that does not receive the exposure, mentorship or capital that they deserve. This campaign is designed to lift up five entrepreneurs, but to also shine a light on all diverse entrepreneurs and debunk the myth that diverse entrepreneurs are few and far between, or too hard to find.

Those featured in Fast Company include four pairs of co-founders and one solo founder, three men and six women and come from four different states and the District of Columbia. They work in a variety of sectors that are addressing innovation and social change around the world.

Meet our #FacesofFounders winners:

  • Stephanie Lampkin is a true champion of inclusive entrepreneurship who turned a denied opportunity into disruptive innovation with her Blendoor application. We were inspired by Stephanie’s holistic approach to addressing diversity and the way she uses her tech expertise to tackle hiring bias.
    See Stephanie’s complete story here.
  • Jean Sim and Irena Todd are creating solutions in the world of affordable children’s haircare products. Both working moms and immigrants with extensive corporate-sector experience, they created Fresh Monster to provide a low-cost way to safely wash kids’ hair.
    See Jean and Irena’s complete story here.
  • Anjali Kataria and her husband Vinay Bhargava co-founded Mytonomy, a health tech company that educates and informs patients through technology, ensuring they arrive at appointments prepared and fully educated on their medical needs. Anjali background working at iconic tech companies allowed her to use her previous experience and successes to advance the healthcare industry.
    See Anjali complete story here.
  • Kristen Sonday channeled her life experience into a drive to create a business with a mission. Kristen, along with co-founder Felicity Conrad, launched Paladin to tackle a problem lawyers across the country face. Her legal pro-bono matchmaking service ensures that attorneys are matched with the right organizations in need of legal assistance.
    See Kristen and Felicity’s complete story here.
  • George Ashton and Yuri Horwitz seized upon an opportunity in the rapidly changing solar energy market to build Sol Systems, a mission-driven company working towards cleaner energy through investments. They focus on innovation in the larger energy world as well as within their own company.
    See Yuri and George’s complete story here.

We are proud to have partnered with the Blackstone Charitable Foundation, Google for Entrepreneurs, UBS and Fast Company on the campaign. Thank you to all the entrepreneurs who shared their stories and supporters of inclusive entrepreneurship who joined the movement.

The #FacesofFounders series on Fast Company is an example of the long-term commitment that the Case Foundation has to ensuring all entrepreneurs have access to the resources they need to build and scale a company. We will continue to support and celebrate entrepreneurs from all races, places and genders as we catalyze the movement for a more inclusive approach to entrepreneurship. To learn more about our work to support all entrepreneurs, to continue the discussion on entrepreneurship, race, place and gender and to meet more entrepreneurs who are breaking down barriers, visit FacesofFounders.org.

Announcing the Five #FacesofFounders Featured Stories

The Case Foundation is proud to announce the results of our first-ever #FacesofFounders campaign. The effort, a centerpiece of the Foundation’s inclusive entrepreneur movement, invited entrepreneurs—particularly women founders and entrepreneurs of color—to share their photos and stories of entrepreneurship on FacesofFounders.org or on Twitter using #FacesofFounders. Launched at the White House’s South by South Lawn festival, in partnership with Blackstone Charitable Foundation, Google for Entrepreneurs and UBS, along with Fast Company, #FacesofFounders seeks out and lifts up America’s dynamic entrepreneurs who are key to driving innovation and job growth. The winners of the crowdsourced contest, who were reviewed by our panel of forty guest judges, were selected because they are bridging innovation and commitment to inclusiveness.  

Meet the winners!

  • Stephanie Lampkin, founder and CEO of the Blendoor application, has leveraged her tech expertise to tackle hiring bias.
  • Jean Sim and Irena Todd are working moms and immigrants who have built Fresh Monster to address a gap in affordable children’s haircare products.
  • Anjali Kataria co-founded Mytonomy, a health tech company that educates and informs patients through technology, ensuring they arrive at appointments prepared and fully educated on their medical needs.
  • George Ashton and Yuri Horwitz seized upon an opportunity in the rapidly changing solar energy market to build Sol Systems, a mission-driven company working towards cleaner energy through investments.
  • Kristen Sonday, along with co-founder Felicity Conrad, launched Paladin to create a legal pro-bono matchmaking service to ensure that attorneys are matched with the right organizations in need of legal assistance.

Each of the winners will be featured this week on FastCompany.com. Today, the story of how Jean Sim and Irena Todd built Fresh Monster was released, but check back each day to read the next story of barrier-breaking innovators from around the country.

We celebrate the five winners in their own right, but also for the light they shine on the tremendous talent and excitement that the #FacesofFounders campaign surfaced. Nearly 4,000 people uploaded a photo and selected a filter showing what entrepreneurship means to them. Nearly 750 founders took the time to thoughtfully and passionately tell us the story of their entrepreneurship journey—with entries from 42 states, 63 percent of whom were women entrepreneurs and 63 percent of whom were entrepreneurs of color. And these stories came from entrepreneurs building businesses across a multitude of sectors—from retail, technology, arts, health and finance industries, among others.

Thank you to everyone who has joined the movement for a more inclusive approach to entrepreneurship! Founders like Kristen, Felicity, George, Yuri, Anjali, Jean, Irena and Stephanie are proof points that innovative, successful businesses are built across the nation, by entrepreneurs from all backgrounds. Together, we are changing the narrative of who is and can be an entrepreneur.

Behind the Scenes with the Judges of #FacesofFounders

As part of the Case Foundation’s work in catalyzing the inclusive entrepreneurship movement, we launched the #FacesofFounders campaign last fall to change the narrative of who is and can be an entrepreneur. In October and November, over 3,000 people created a custom photo with a caption of what entrepreneurship means to them and nearly 750 founders submitted their entrepreneurship story. From our launch at the White House’s South By South Lawn festival, to Jean Case’s talk about unlocking the American Dream for all at TEDxMidAtlantic, #FacesofFounders has inspired and energized us all to join the movement for inclusive entrepreneurship. After some challenging choices and deep analysis by our guest judges, we’re excited to announce that the five winning stories will be featured on Fast Company starting February 27th!

In preparation for this reveal, we asked a few of our guest judges to share some behind the scenes insights and words of wisdom about the opportunities and challenges of being an entrepreneur. Thank you to all of our judges—we could not get to this point alone! We were joined by forty guest judges who are experts in entrepreneurship ecosystem building, investors or entrepreneurs themselves. Here is what they have to share with us as we all find new ways to #GetInTheArena and fight for meaningful inclusion in entrepreneurship.

What is a piece of advice you wish you had known when starting out in the entrepreneurship field?

Take action when you’re 80% ready. There are lots of people with great ideas, but the real traction is gained by those who take continuous action on those ideas.
– Carolyn Rodz, Circular Board

Surround yourself with a community of supporters. Ideas are born out of dreams for something new, different, and impactful. It takes a lot of time, nourishment, and most importantly a community of supporters to enable an idea to truly flourish into a venture. Every entrepreneurial success has taken hundreds of small and big connections to bring it to life.
– 
C’pher Gresham, SEED SPOT

Entrepreneurs are explorers. Your adventure will have extreme highs and lows, but the journey will be worth the destination.
– 
Elizabeth Gore, Dell

As an intrapreneur, I wish I knew that you don’t have to be perfect to launch a new project or endeavor. It’s so easy to get caught up in making something absolutely excellent, but the important lesson is don’t wait to launch. When we interviewed Eric Reiss of the Lean StartUp, I started to realize the importance of letting go of being a perfectionist and launching. Some of my favorite accomplishments have come from a Lean StartUp approach.
– Gabrielle McGee, Tory Burch Foundation

I wish I had known that making an impact or doing meaningful work is not enough to build a sustainable, impactful venture. For social entrepreneurs, we must do the work that changes lives but we also have to constantly build and cultivate relationships with supporters and stakeholders as well as be compelling advocates for our cause. Making a measurable impact on someone’s life is the hardest and most meaningful part of social entrepreneurship, but it takes even more than that (like fundraising skills, management know-how, etc.) to be a successful social entrepreneur.
– 
Darius Graham, Social Innovation Lab at Johns Hopkins University

Plenty of smart, dedicated, and passionate entrepreneurs with promising viable business ideas have lost out on opportunities or money due to horrible pitches. Here’s how not to be one of them—don’t try to tell your life story. These are the pitch perfect things to you want to convey: how the product, service, or technology you are offering solves a problem or pain that you are familiar with; how much of your own time and money are you willing to risk; who is your competitor because every business has one; how are you going to acquire new customers and keep any existing customers happy; and what is your business model and how it will make you money.
– 
Carolyn Brown, Black Enterprise

In every meeting, focus on the value you are providing—not the value of your company, but the value to the other person! If you’re fundraising, you should understand the problem the investor is trying to solve, and focus your conversation on how you help them solve the problem (not why you’re great!). If you’re talking to a customer, understand what their pain point is and focus on how you help them solve it (not why you’re great!). When talking about value, it’s better to be specific and wrong than vague and right, so try and be as specific as possible: not just “better” but “3x faster”; not just “cheaper” but “half the price”.
– Ross Baird, Village Capital

Hire slow and fire fast. When you’re starting up you might have a tendency to try to hire people quickly because it feels like momentum. The problem with that is that you may be compromising culture fit and you’re signing up for more as you’ve added payroll which means you now have to do more to sustain the team.  Additionally, in a startup every moment matters so if you find yourself with a hire that is not working out, make a change as soon as possible. Most likely the hire in question knows that they’re not the right fit – so it shouldn’t be a surprise.
– 
Frank Gruber, Tech.co

Remember, everything you see is just a thought manifested. Your job is hustle, manifest and hustle some more! – Talib Graves-MannsBlack Wall Street Homecoming

What do you think distinguishes a promising entrepreneur?

I always keep an eye out for founders who are personally committed to their mission, and who have engaged others in making it come to life. When it becomes more than a solo mission, entrepreneurs hit a point where failure is no longer an option, and that’s where the real magic happens.
– 
Carolyn Rodz, Circular Board

I look for evidence that the applicant has a deep, intimate understanding of the issue being addressed and the population being served. This can be shown in different ways such as through work experience, academic study, or – most often – life experience. In my years of work supporting social entrepreneurs, one of the key things that sets apart the highly-impactful entrepreneurs from the less-impactful ones is an extensive understanding of the issue being addressed and the population being served.
– Darius Graham, Social Innovation Lab at Johns Hopkins University

Relationships matter, which means people matter. Successful entrepreneurs understand this and have fostered important relationships to propel themselves to success. As much as it might sometimes seem, nothing is an overnight instance success.
– 
Frank Gruber, Tech.co

What surprised you about the #FacesofFounders applications?

What surprised me the most about #FaceofFounders applicants was how diverse the businesses were. Innovation is alive and thriving! It’s exciting to learn about businesses that are disrupting, creating new ways, new products and many of them are making a difference in the world and their local communities.
– Gabrielle McGee, Tory Burch Foundation

The sheer size of the positive energy around problem solving for experiences each founder had all over the country! My hope is #FacesofFounders has helped diverse entrepreneurs feel a community around them and that it doesn’t matter the color of your skin, where you grew up, or your political beliefs, but that ANYONE can start a venture with enough passion, true grit, and belief in creating a better future.
– C’pher Gresham, SEED SPOT

Thanks again to all of our guest judges and partners Blackstone Charitable Foundation, Google for Entrepreneurs and UBS who made this campaign possible. Because of these partners and the thousands that have committed to join the movement for a more inclusive approach to entrepreneurship, we are opening doors to innovators everywhere to start and scale their businesses. Come back on Monday to read the featured stories of fearless, problem solving founders on Fast Company!

Biggest Trend in Social Good? Women in the Driver’s Seat!

I was recently asked to open up a dinner conversation with a room full of social innovators—a mix of foundations, entrepreneurs, impact investors and companies—by laying out what I saw as the top three trends in social good. These trends are important in that they inform our arenas for action and the clarion call we, at the Case Foundation, are making to all citizens to “Get in the Arena.” That night, I picked three distinct trends because I felt it opened up more conversation. In hindsight, I wish I’d gone with my original three: women, women and women. 

Trend 1: Women as Investors

You may recall an earlier blog I wrote about Trailblazing Women in Impact Investing where I talked about women emerging as a driving force behind the growth of the Impact Investing industry. From founding firms focused on impact investors, to creating tools and products to catalyze capital, to leading nonprofits and foundations focused on educating and activating a host of actors, women are spearheading and populating this sector more so than any other financial services sector.

A recent Calvert Investments report asserts that women, along with younger investors, will indeed drive the growth of the broader responsible investment industry. In a study of affluent women, 95 percent ranked “helping others” and 90 percent ranked “environmental responsibility” as important. And beyond driving the growth of Impact Investing, woman may be our greatest hope to unlocking the kinds of game-changing innovations required to solve the most persistent problems. Turns out that women wealth holders exhibit more risk tolerance toward new and innovative solutions, once they have met the financial security needs of themselves and their families. As Sallie Krawcheck wrote in her thought-provoking piece, women investors exhibit a slightly different values-based perspective. More women want their investments to not just generate excellent returns, but also have a positive impact on the world they live in. And they’re willing to make some big bets to deliver on that perspective.

This data reinforces the importance of ensuring that women continue to be aware of the momentum in the Impact Investing space. Remember, their purchasing power and, therefore, their potential social impact power is enormous—women control 39 percent of investible assets in the U.S. today. That number will continue to rise; women currently control 51 percent, or $14 trillion, of personal wealth in the U.S. and are expected to control $22 trillion by 2020.

Trend 2: Women as Consumers

Women represent the largest market opportunity in the world. Globally, they control $20 trillion in annual consumer spending. In the next five years, it is expected that this number will rise to nearly $30 trillion. For context, that is more than the two largest growth markets typically identified—China and India—combined! In the U.S., women control somewhere between $5-15 trillion, with estimates that they will control two-thirds of the consumer wealth in the U.S. over the next 10 years.

Women handle the bulk of purchasing decisions for everyday items like groceries and clothing and are also heading up and/or highly influential in large ticket purchases like cars, homes and appliances. Here’s another kicker—they even purchase 50 percent of the products marketed to men!

Why is this a trend worth watching in social good? Because women often make purchasing decisions based on their personal and social values. The HBR piece on the “Female Economy” is a must-read on the role women will play as consumers, members of the workforce, productivity drivers and caregivers. On the women as consumers front, my favorite quote:

“Once companies wake up to the potential of the female economy, they will find a whole new range of commercial opportunities in women’s social concerns. Women seek to buy products and services from companies that do good for the world, especially for other women. Brands that—directly or indirectly—promote physical and emotional well-being, protect and preserve the environment, provide education and care for the needy, and encourage love and connection will benefit. And women are the customer. There’s no reason they should settle for products that ignore or fail to fully meet their needs, or that do so cynically or superficially. Women will increasingly resist being stereotyped, segmented only by age or income, lumped together into an “all women” characterization, or, worse, undifferentiated from men.”

Given the forthcoming wealth transfer predicted, many of these upwardly mobile consumers and asset owners are Millennial women. Millennial customers, employees and importantly—entrepreneurs—lead their lives and make choices with a more holistic worldview. They contribute to and support the things they believe in and they use their dollars to exercise those views and beliefs.

Trend 3: Women as Entrepreneurs

And perhaps the greatest trend of all to watch in terms of opportunity to drive social good is the rise of women in entrepreneurship.

American Express OPEN’s 2016 State of Women-Owned Business report is a must-read. The number of women owned firms and their economic contributions continue to rise at rates higher than the national average. As of 2016, this data shows 11.3 million women-owned businesses in the U.S., employing nearly 9 million people and generating over $1.6 trillion in revenues.

The report show that between 2007 and 2016:

  • The number of women-owned firms increased by 45 percent, compared to just a 9 percent increase among all businesses. That’s five times faster than the national average.
  • Their employment growth increased by 18 percent, compared to a 1 percent decline among all businesses.
  • Their business revenues increased by 35 percent, compared to 27 percent among all U.S. firms. That’s 30 percent higher than the national average.

And check out the growth of firms owned by women of color! Their numbers have more than doubled since 2007, increasing by 126 percent.

Now, let’s turn our attention to venture-backed companies in particular, given their potential for high growth. Less than 10 percent of venture-backed companies have female founders, despite the evidence that gender-diverse companies drive greater market returns and innovation; that VC portfolios show women-founded companies outperform those founded by men; and that funds declaring gender diversity an “investing factor” give higher returns with women at the leadership level.

I think we are going to see these dreadful statistics change over the next couple of years. Increased attention being paid to these numbers, including by our own #FacesofFounders campaign and others (UBS, Blackstone Foundation, Google for Entrepreneurs, Kapor Center, 500 Startups, JumpStart, to name just a few) will help. Why is this a social trend worth accelerating? To put this into perspective, according the Economist, if women entrepreneurs in the U.S. started with the same capital as men, they would add 6 million jobs to the economy in five years—2 million of those in the first year alone.

As we ring in 2017, with all of its uncertainties, I for one commit to getting in the arena of investing in women with intention. For one thing appears pretty certain—our economy, as well as our social fabric, depends on them.

Jean Case at TEDxMidAtlantic: Unlocking the American Dream

Case Foundation CEO Jean Case took the stage at TEDxMidAtlantic: New Rules—a gathering of 45 prestigious leaders who came together to discuss and think about what kind of society and future we want to build, and how we get there. Jean’s talk noted the importance innovators have played in the history of the United States, examined the state of entrepreneurship today and promoted a series of changes we could make to open the doors of entrepreneurship to everyone.

Jean shared the true but often surprising statistics that show that women and entrepreneurs of color are too-often being left on the sidelines, but contrasted them with her vision of a world where all innovators and change makers were on a level playing field. While she recognized that there are still many challenges facing women and entrepreneurs of color involving unconscious bias, she called on investors to take a hard look at their portfolios and the opportunities they were missing by not tapping into the rich talent of diverse entrepreneurs. Standing on the iconic red TED carpet, Jean set forward a clarion call for all to join in on building an inclusive entrepreneurial ecosystem that would give everyone an equal chance at unlocking the American Dream.

Watch Jean’s TEDx talk below to learn more about the realities for women and entrepreneurs of color today, and how we can help change the face of who is and can be an entrepreneur.

 

The Myth of the Coasts

The ‘Myth of the Coasts’ is a guest blog post from Cathy Belk, President of JumpStart, Inc., and is the seventh blog post in the Case Foundation’s Myth of the Entrepreneur series. This series is intended to intentionally examine, and change, the stories our culture tells about entrepreneurship. For more information on the Case Foundation’s approach to the Myth series and Inclusive Entrepreneurship, please check out our introductory piece. We encourage you to join the conversation using #Ent4All on Twitter.

If I say the word “startup,” you probably think Silicon Valley, or maybe Boston or New York City. And that would be understandable, considering that, according to NVCA and MoneyTree PriceWaterhouseCooper Annual 2015 Report, roughly 77 percent of all venture capital investment last year went to either California, New York or New England.

But what these statistics don’t show, is that right now is also a great time to be a startup entrepreneur in the Midwest.

Here are just a few of the common myths about Midwestern entrepreneurship that are being debunked more and more every day. 

Myth One: The Midwest Doesn’t Have Great Talent

One of the founders of modern venture capitalism, the late David Morgenthaler, was fond of comparing entrepreneurship to a horse race consisting of the jockey (team), the horse (product) and the track (market). One myth I hear often is that the Midwest just doesn’t have the jockeys—entrepreneurs with a track record of success and failure, along with all the connections (investors, customers, board members, etc.) and experience that come with both.

But the fact is, we have plenty of great talent. In Cleveland we have successful entrepreneurs like Mark Woodka, Laura Bennett, Steven Lindseth and Charu Ramanathan as well as entrepreneur/investors like Doug Weintraub and Charles Stack, not to mention recent exits from companies like OrthoHelix, TOA Technologies and Explorys, whose cofounder and CEO Stephen McHale is also an active angel investor and entrepreneurial mentor in the community. And that’s just a few examples from one city.

Meanwhile, Midwestern universities are actively working to develop the kind of talent startups need, challenging their students to think more entrepreneurially and encouraging them to start their own businesses. In Northeast Ohio alone, all of the region’s 22 colleges and universities have collegiate entrepreneurship programs, many of which also include experiential learning components, such as Cleveland State University’s Startup Vikes program.

And let’s not forget the rise of Midwestern coding bootcamps such as The Software Guild, TechElevator and WeCanCodeIt; or the many talented young people—from entrepreneurs and web developers to the greatest basketball player in the world—who are boomeranging back to the Midwest and bringing their talents back with them. 

Myth Two: There’s No Capital For Entrepreneurs

Did you know that, according to the 2016 NVCA Yearbook, more than $2.2 billion in venture capital was invested in the Midwest in 2015, the highest amount since 2001? Capital is always a concern for entrepreneurs, but there is money available, and more and more investors are starting to see the potential of tapping into the region’s grossly underserved market.

In the meantime, local investors are stepping up to provide much of the early financial (and intellectual) capital to help local startups grow. In Ohio, 75 percent of the capital prior to Series B rounds comes from local (statewide) sources, and these investors are continuing to ramp up their activity.

Right now my organization, JumpStart, is in the process of investing $40 million dollars into Ohio entrepreneurs over the next three years through three separate venture capital funds. Ohio also has five organized angel groups, including two of the nation’s largest, North Coast Angel Fund and Ohio TechAngel Funds.

Myth Three: There’s No Diversity

Silicon Valley is a diverse place, and accounted for nearly 50 percent of U.S. venture dollars invested in 2015. And yet, less than ten percent of U.S. startups backed by venture capital are led by women, and only one percent are headed by African-Americans. In addition, nearly 90 percent of all venture capital professionals are still Caucasian men and only 7 percent of the partners in the top venture firms are women.

Meanwhile, some in the Midwest—a region often stereotyped as being homogenous—are seizing a valuable opportunity to be diverse and inclusive, building both fully inclusive organizations such as TechTown, as well as targeted programs such as PowerMoves, driving a more diverse pipeline of entrepreneurs and creating a major competitive advantage. At JumpStart, more than 30 percent of the companies we advise or invest in are owned or led by women or people of color, and we recently took this commitment even further by creating the Focus Fund—a $10 million venture capital fund supported by the Case Foundation that focuses exclusively on female founders and entrepreneurs of color.

Myth Four: The Lower Cost Of Living Isn’t That Important

Most people already know that the general costs to start or run a tech business in the Midwest are lower than they are on the coasts. This is especially true for real estate—both commercial and residential—where Silicon Valley prices aren’t just high, they are the highest in the entire nation (New York City is right behind). Consequently, average salaries are also much higher.

But to grasp the true entrepreneurial advantages that come along with lower cost of living, you have to think less about dollars and more about time—specifically, how much time you have to make your startup successful before your venture runs out of runway. An entry level programmer salary for a company with fewer than 25 associates in the software industry in the Valley is ~$71K, while in the Midwest the average is ~$58K. That differential (almost 25 percent) is almost three months of time.

As you can see, it’s a very good time to be an entrepreneur in the Midwest. But no matter where you call home, don’t let these kinds of myths keep you from chasing your goals. Focus on whatever key competitive advantages your location offers, and remember that success is mostly determined by hard work and strong business fundamentals—not geography.

#FacesofFounders Puts Entrepreneurship Front-And-Center at Forbes Under 30 Summit

The #FacesofFounders campaign, designed to highlight the dynamism and diversity of the modern entrepreneur, is in full force. Entrepreneurs from all walks of life and perspectives are uploading their photos and telling their stories at facesoffounders.org. The stories and the photos bring to life the fact that there has been a redefinition of who is and can be an entrepreneur.

In addition to uploading photos and stories at facesoffounders.org, we are taking our #FacesofFounders campaign and photo booth on the road. Last week we were in Boston with the Blackstone Charitable Foundation where we welcomed guests to the Forbes Under 30 Summit. At the event, hundreds of entrepreneurs snapped their photos and shared their stories of innovation.

While the #FacesofFounders photo booth was working overtime, we met with hundreds of founders, hosted Facebook Live conversations and watched insightful discussions with entrepreneurs from across the globe geared towards the topic of inclusivity. While there were many standouts at this event, in our opinion, these were the all-stars who stole the show and are representative of the changing face of entrepreneurship.

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  1. Founders Hayley Barna of First Round Capital and Birchbox, along with Lisa Falzone of Revel Systems, Jennifer Hyman of Rent the Runway and Marcella Sapone of Hello Alfred are changing the narrative around who is and can be an entrepreneur. On stage, they joined Janey Whiteside of American Express in a conversation on the changing face of entrepreneurship and how, by unlocking more flow of social capital, financial capital and knowledge capital, we can cultivate more women entrepreneurs.
  1. Christopher Gray, co-founder of Scholly, sat down with us in a Facebook Live interview for a conversation on the challenges he faced as a young Millennial founder and how we all can engage to change the narrative about what it means to be an entrepreneur.
  1. Trevor Wilkins, co-founder of Küdzoo, built a free mobile app where students cash in their grades for rewards. He shared with us during Facebook Live how the brand is leveraging incentives to motivate and reward students, and his experience building the brand as a founder of color.
  1. Sir Richard Branson took the stage for a conversation on breaking records, barriers and borders. He was joined by other top entrepreneurs Tyler Haney of Outdoor Voices, Payal Kadakla of ClassPass and James Proud of Hello, Inc. in discussion around the best ways to cause disruption, create change and achieve game-changing success.
  1. Eric Delgado and Victoria Weiss, co-founders of Rope Lace Supply and students at the University of Central Florida (UCF), joined us for a Facebook Live conversation on how the brand has grown from $300 to nearly $1 million in revenue in just three short years. The founders are part of the Blackstone LaunchPad at UCF, a program that provides one-on-one startup coaching, seminars and access to a mentor network and subject-matter experts and their story is a compelling reminder of how the entrepreneurs from all ages can succeed.
  1. Actor and investor Ashton Kutcher, Guy Oseary of Sound Ventures, and Peter Boyce II of Rough Draft Ventures hosted the $1 Million Forbes Under 30 Pitch Competition. More than 1,000 Under 30 entrepreneurs entered for the opportunity to pitch their project and the final four competed on stage at Faneuil Hall for the grand prize—an investment from Kutcher, Oseary and Rough Draft Ventures/General Catalyst, as well as an advertising campaign in Forbes. Atlanta-Based honorCode, founded by Jeffery Martin to teach the intersection of computer programming and entrepreneurship to our communities’ most vulnerable youth, walked away with the highly sought after prize.

Check out the faces of several of these entrepreneurs and their supporters who are joining the movement to change who is and can be a founder on FacesofFounders.org, and be sure to show your support for entrepreneurship for all by sharing your photo and stories there as well. Read more about the 600 entrepreneurs and changemakers who are part of this year’s 2016 Forbes Under 30 class HERE.

Disclosure: Steve Case has made a personal investment in Scholly.

Four Ways to Tip the Inclusive Entrepreneurship Movement

When Jessica O. Matthews, the founder and CEO of Uncharted Play, an energy tech startup, closed a $7 million investments last week she became just the 13th black female founder in history to raise more than $1 million in outside investment. She followed Morgan DeBaun of Blavity, considered to be the Buzzfeed for Millennials of color, and who became the 12th female founder to surpass $1 million raised only days before.

The numbers are stark. The Diana Project out of Babson College was the first to report that less than three percent of venture capital investments made go to companies with a woman CEO. CB Insights reports that fewer than one percent have an African American founder.

So why does this matter anyway? While it’s true there is a fairness issue at work here that should concern us all, it’s also true that the potential to bring new innovations and new economic activity to segments of the population that may need it most is a significant opportunity we should seize. But what will it take to level the playing field for all entrepreneurs—particularly women and entrepreneurs of color—but also those from less obvious places, geographically and economically diverse entrepreneurs from the nation’s heartland to Southern Africa to the West Bank?

recent report by the Initiative for a Competitive Inner City (ICIC) offers a compelling framework through which to view and potentially tip the inclusive entrepreneurship movement. ICIC laid out a four-part framework to increase participation of women entrepreneurs and entrepreneurs of color through more inclusive hubs that provide mentoring, training, networking and sometimes capital for entrepreneurs in their network. These hubs are known as incubators or accelerators. When looking at barriers to access and how to create effective on-ramps for diverse entrepreneurs, this framework is promising in both the accelerator space and the broader inclusive entrepreneurship ecosystem.

Recruitment

Improving access to social capital through mentoring and networking with others who have found success will be key to accelerating the movement. Many successful accelerators or incubators rely on a competitive application process from applicants that find them. This often means that those living in underserved communities or outside of “power networks” don’t necessarily know about these pathways to opportunity. Adopting a strategy of intentional outreach to women and to people of color could change the ratio and ensure a more diverse pool of applicants. Kathryn Finney knows this firsthand. As the founder and Managing Director of digitalundivided, Kathryn invests in the success of Black and Latina women tech founders by providing them with the network, coaching and funding to build, scale and exit their high growth companies.

Selection

The ICIC report rightly points out that biases perpetuate the stereotype of what successful entrepreneurs look like which often impacts access to capital for women and entrepreneurs of color. This is often called “unconscious bias” which simply means that there is a pre-existing idea of what a successful entrepreneur looks like or where they come from. We’ve seen this in our own work with pitch competitions—where there is a more diverse judging panel we see a more diverse selection of winners, and it makes sense as these panels bring a broader perspective to the potential of underserved segments. And a more diverse selection panel can bring the benefit of putting the applicants more at ease and allowing them to be the best they can be when pitching their ideas. This point is one we can all understand—imagine how a young entrepreneur feels with a great idea if he/she is presenting to a panel of judges or an audience comprised entirely of a different gender or race/ethnicity. Of course, many young entrepreneurs have risen to the challenge for years since the data makes clear that most selection panels have been, and still are, comprised of white males, but it is common sense that if we want to grow the population of successful inclusive entrepreneurs, we might want to start by thinking about who is doing the selection.

On this point, Tristan WalkerCEO and co-founder of Walker and Co Brands, a company that designs and develops products and services specifically for people of color, demonstrated the power of building a company from personal experience when his company raised a $24 million Series B round in September 2015. But his experiences with white venture capitalists who doubted there was a market need for the new kind of razor he was creating for black men, taught him that context and perspective really matter when assessing great ideas for the market. In an interview with TIME Magazine, he commented: “I’m like, I get it but I don’t. All you had to do was get on the phone with 10 black men, and nine of them would have said, ‘I’ve had to deal with this my entire life.’ This is why I think folks talk about the need for more partners, the need for more folks in the industry because those folks come with the context.”

Program Design

Philanthropy is also in a unique position to bring significant support to ecosystem builders to ensure that the support services needed for entrepreneurs (both social capital and financial capital) exist. By building up networks and geographic hubs outside of Silicon Valley and across economic, gender and color lines, we can expand the opportunity for all entrepreneurs to bring their ideas to market—ideas like Jehiel Oliver’s Hello Tractor, an award winning ag-tech company focused on improving food and income security in several countries throughout Africa. We should also look to partnerships and programs that aim to reduce common barriers that diverse entrepreneurs face, and scale local pilots into national programs serving women and entrepreneurs of color, who have figured out the “secret sauce” to the kind of program design that builds success for inclusive entrepreneurs.

Culture

“The macho, exclusive, hyper-competitive culture of some high-tech accelerators is the image marketed and shared by media, creating perhaps the biggest deterrent to women and minority entrepreneurs,” says Janis Bowdler in TechCrunch. We absolutely must challenge the stereotypes and change the narrative on how our culture represents entrepreneurs across sectors. There are many remarkable stories of successful women and people of color who have built successful businesses, and we somehow need to build these stories more broadly into the narrative of the American entrepreneurship story. CEOs like Tristan Walker (mentioned above), or Kristin Groos Richmond and Kirsten Saenz Tobey, a pair of power moms who co-founded Revolution Foods*—a company on a mission to ignite a healthy food revolution for all children, whose business has now delivered more than 200 million healthy meals to our nation’s schoolchildren. Or Shazi Visram of Happy Family, a healthy baby food company acquired by Danone. With the acquisition, Shazi’s earliest investors realized a 30x return. Lifting up founders of diverse backgrounds will be key to ensuring that any individual with a great idea can see him or herself as the next great entrepreneur.

We need all individuals with breakthrough business ideas to have a seat at the table so that we can move more swiftly in tackling intractable global challenges, transforming communities, creating jobs, spurring economic growth and closing the opportunity gap. Maybe this framework is what’s needed to get all ecosystem builders—from accelerators, investors and incubators to founders and champions—to get much more intentional about leveling the playing field for all entrepreneurs in all places in order to create stronger communities. The U.S. has become the leader of the global economy because of great companies built by great entrepreneurs, but we’ve done it with half of the team left on the sidelines. We have an amazing opportunity to seize by getting everyone in the game.

*Disclosure: Steve Case is an investor in Revolution Growth II LP and Revolution Growth III LP, each of which is an investor in Revolution Foods. He is also on the Revolution Foods Board of Directors.

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VIDEO: Inclusive Entrepreneurship at MCON 2016

 This post was written by Calvin Millien, Case Foundation intern.

At MCON 2016 this past June, one of the themes attendees explored was around inclusive entrepreneurship—lifting up all entrepreneurs, particularly women and people of color, in all places in order to create stronger communities, close the opportunity gap and scale creative solutions to persistent problems.

To delve into this subject, Derrick Feldmann, Founder of Achieve and MCON, hosted two special panelists: Karla Monterroso of Code2040, an organization that provides $40,000 to seven entrepreneurs of color determined to turn their ideas into reality; and Brian Ferguson of Start Line, an online platform designed to equip returning, formerly incarcerated citizens with the tools necessary to become active and entrepreneurial contributors to our society. Together, they discuss the entrepreneurial landscape and realities for Black and LatinX communities specifically. Hear their insights into how together, we can support inclusive entrepreneurship.

To see more from these great speakers, check out their exclusive Facebook Live interview with the Case Foundation’s own Jade Floyd.