Developing the Entrepreneurial System – Here and There

ecosystem

A professor from the University of Michigan’s Ross School of Business is writing from his home state’s perspective, but sharing insights regarding Midwest entrepreneurial ecosystems and how they might differ from international efforts. He notes four key elements, including the always popular capital and worker skill aspects:

  1. The most important step is connecting with your customer

While understanding the basic fundamentals of cash flow and knowing how to manage a staff is important, businesses everywhere must put finding the customer first if they want to be successful. For Midwestern businesses, that might be a challenge for marketing. For startups in some developing economies, the search can be less abstract: Infrastructure challenges can make connecting with customers more difficult. For example, in Vietnam, the single biggest platform for ecommerce is Facebook — but in rural Morocco, a lack of infrastructure makes ecommerce virtually impossible. Interpersonal connections and marketplaces remain indispensable.

  1. Success begets success

In the United States, the story of every successful startup cluster begins with capital — and one of the best sources of capital is another company’s exit. We’ve also seen that for every $1 a Michigan startup receives from a Michigan VC firm, it attracts $4.61 of investment from outside of Michigan. Cash is the fertilizer, and the more of it in the environment, then the more likely the economy will grow.

This logic doesn’t always hold in developing economies, one of the hallmarks of which is no middle class and a huge income disparity. When wealth is created in these environments, there are many places that the money can be reinvested in besides another startup: to fund education, for example, or to buy more land. That being said, more wealth generated by new venture activity has the potential to lift the income threshold and lead to a more stable, flourishing economy. 

  1. Give your talent the fulfillment they need

A major challenge for small communities is talent, no matter where they are located. But talent isn’t just about having smart people — it’s about having people with the skills needed to build a business, and a community that can support them. In the Midwest, that talent gap often takes the form of local workers who are educated, well-trained, and experienced in running a business, but who might not choose to stay and work in their communities if there aren’t opportunities that appeal to them.

Robust entrepreneurial ecosystems with more activity have the potential to attract top talent away from more metropolitan areas. It can become a self-sustaining cycle once it gets going, but may take a significant event or local unicorn to get it kicked into action. In developing countries, that more often looks like workers who have limited skills, who need the determination and resources to invest in themselves — and who need an ecosystem that can provide them with that base.

  1. Take local differences into account

What works in Silicon Valley doesn’t always work in Chicago — and what works in Kosovo might not work in Vietnam. When it comes to translating what has worked in one place to another, the details become local, and critical. Some business climates trust banks and credit lines; others operate solely in cash. In some places, the local language is widely spoken; in others, that local language could be six different dialects. Just as the National Venture Capital Association has local chapters to better understand and focus on the small ecosystems being built all over the United States, context is everything for entrepreneurs looking to get off the ground no matter where they are.

While languages, customs, and currency differ from country to country, one thing doesn’t: When entrepreneurs and innovation win, it can lift the outlook of an entire economy. With the right resources and support, the Midwest has stepped up to create the jobs and standing it needs to survive in the modern economy — and developing ecosystems around the world are doing the same.

Beyond the Bicentennial: Chamber Outlines Policy Recommendations for 2016 Candidates

Indiana has many advantages as a leading location to operate a business, raise a family or enjoy a high quality of life. But still more needs to be done to improve that climate and to keep pace with other cities and states, says the Indiana Chamber of Commerce.

The organization unveiled today its six-week Beyond the Bicentennial campaign (going beyond the state’s first 200 years). It focuses on the “most potentially impactful public policies” and is directed foremost at the major party gubernatorial candidates, John Gregg and Eric Holcomb.

The Indiana Chamber’s Indiana Vision 2025 plan, first introduced in 2012, serves as the campaign blueprint. “The Indiana Vision 2025 economic drivers present a great opportunity to highlight initiatives that will benefit Indiana now and in the years ahead,” offers Indiana Chamber President and CEO Kevin Brinegar.

The first of the four letters, also released today, emphasizes the Outstanding Talent driver. Recommendations focus on critical improvements at the K-12, postsecondary and workforce levels. In an annual survey earlier this year, 45% of responding employers indicated they had left jobs unfilled in the past year due to under-qualified applicants.

“Outstanding Talent is both the greatest challenge for our state and the area of most importance,” Brinegar states. “While businesses are rightfully concerned about their current and future workforces, for individuals we’re talking about the difference between happy, productive lives and what can amount to an economic death sentence if proper education and training are not received.”

The education/workforce needs range from greatly expanding the state’s pre-K pilot program to more students from low-income families, to assisting the more than 700,000 Hoosiers with some college but no credential or degree to gain the skills needed for a rapidly-evolving economy.

Concludes Brinegar, “We hope the recommendations and guidance in these letters will help the gubernatorial candidates and all lawmakers focus on what public policies could be the most impactful for Hoosiers.”

Additional Beyond the Bicentennial letters and accompanying videos will be made available on September 13 (Attractive Business Climate), September 27 (Superior Infrastructure) and October 11 (Dynamic & Creative Culture).

The Outstanding Talent releases are available now at www.indianachamber.com/letters.

barber

WGU Indiana Chancellor Allison Barber spoke at our press event this morning: “We want to encourage employers to set the standard that talent matters.”

About Indiana Vision 2025
In 2012, the Indiana Chamber published Indiana Vision 2025, a comprehensive, multi-year initiative to provide leadership and a long-range economic development action plan for Indiana. The mission statement: “Indiana will be a global leader in innovation and economic opportunity where enterprises and citizens prosper.”

A 24-person statewide task force of business and organization leaders developed the original plan. Many from that group, with some additions, worked for four months earlier this year to review progress, update goals and metrics, and identify potential new research to enhance future Report Cards (progress on each of the now 36 goals under the four drivers is assessed every other year).

The Indiana Chamber thanks Duke Energy, NIPSCO, Old National Bank, Vectren and all the investors in Indiana Vision 2025.

Learn more about Indiana Vision 2025 at www.indianachamber.com/2025.

 

Talent War is Underway

16342368As the economy has improved, unemployment rates have fallen, and employees have become more demanding. Manta polled small business owners about employee benefits and found that they are feeling the pinch — mostly from prospective employees — about benefits plans. According to the poll, about 47% of potential employees put the pressure on about benefits. Employers are also feeling the pinch from their competitors’ plans.

The most common benefit offered, according to the survey, is paid vacation (72%), followed by flex-time benefits (58%), paid sick leave (57%) and remote work options (46%).

A separate study by Aflac confirms this trend. Almost two-thirds of employees polled were likely to take a job with lower pay but better benefits. And 42% of employees said improving their benefits package was one thing their employers could do to keep them in their jobs — ranking higher than a promotion. What’s more, 16% admitted they have left a job or turned down a job in the last 12 months due to the benefits offered.

Finally, employees who are satisfied with their benefits are much more likely to be satisfied with their jobs (96% vs. 68%) and less likely to be looking for a job in the next 12 months (46% vs. 57%).

INTERNnet Partnership with enFocus in Northern Indiana to Battle Brain Drain

enfcouseThis column originally appeared in the Inside INdiana Business BigWigs & New Gigs newsletter.

Indiana INTERNnet (IIN) is forging partnerships with regional groups that share equal tenacity for increasing talent retention in the state. Our newest partner, enFocus, is already making a difference in South Bend.

enFocus is a “talent incubator and social innovation engine” whose approach is to cultivate what’s in its own backyard.

Its fellowship program encourages recent graduates from the area to stay and help develop St. Joseph County by giving them the resources to solve real community problems. In addition, a partnership with the St. Joseph County Chamber of Commerce is creating more internships in the area than ever before.

IIN has teamed up with enFocus to pilot a strategic feedback mechanism for experiential learning program development, expansion and improvement in St. Joseph County, with the goal of expanding it statewide. The comprehensive survey will measure internship success and the impact on talent retention.

Kathleen Ryan, a first-year fellow at enFocus and project lead on the survey pilot, credits an internship as the key to discovering what she truly wanted out of her career.

“It is because of an internship with a community health outreach organization during my senior year of college that I pursued an enFocus internship,” she explains . “At that time, I fully intended to continue on to medical school post-graduation. Through this experiential learning experience, however, I found that I was more drawn to community development.”

This type of career exploration is the cornerstone of enFocus’ mission in St. Joseph County and IIN’s mission statewide. enFocus works to curb the area’s brain drain with a two-pronged system: consulting with local organizations and offering time and resources to its fellows, who work to find solutions for regional industries. Following the program, enFocus works to place fellows in jobs in the area.

Since its inception in 2012, enFocus and its fellows facilitated regional projects like SB150, South Bend’s 150th birthday celebration, and the Regional Cities Initiative.

enFocus also partners with the St. Joseph County Chamber and its internship program, InternSJC.

“Through InternSJC we offer consultative services to local companies, working with them to make internships more valuable, efficient and exciting for company staff and students seeking employment in the area post-graduation,” Ryan describes. “Also through InternSJC, we help facilitate a summer community engagement program for interns in the area, seeking to improve the student experience and perception of our region’s opportunities through social programming, networking events and community service opportunities.”

All of the organization’s facets come together for a common goal: to make St. Joseph County a better place to work and live.

“We expose students and graduates to real-life issues felt by our regional partners and challenge them to alleviate those pain points,” Ryan emphasizes. “This enables them to develop professionally and gain experience while providing invaluable service to the community.

“We realize that Michiana is not the only region in Indiana that could rally around talent and youthful leadership to grow. We want to expand our model across the state to make Indiana an even more preferable place to start a career, business or family.”

IIN and local economic and community development groups are making strides in other regions as well.

For nearly 10 years, IIN has worked with the Northeast Indiana Graduate Retention Program (GRP, now a part of Greater Fort Wayne Inc.). The Greater Fort Wayne Inc. Fellows Program is a 12-month experience that connects high potential college students with Greater Fort Wayne Inc. investors who have a regular need for new talent. The program utilizes dedicated summer internship experiences as admission into the fellowship.

In Northwest Indiana, colleges and universities are joining forces to promote their students under the umbrella of Ready Northwest Indiana, an economic development and education initiative. Ancilla College, Calumet College, Valparaiso University, St. Joseph’s College and the Center of Workforce Innovations, Inc. are teaming with IIN to meet the needs of employers through a common platform to access students prepared for internships.

We look forward to the difference these efforts will make in St. Joseph County and statewide.

To register for our free service, visit www.IndianaINTERN.net, or call (317) 264-6862 to speak with our staff about your internship program.

Janet Boston is executive director of Indiana INTERNnet — an affiliate program of the Indiana Chamber.