E-Capital Our Greatest Need

Posted: February 10, 2013 by Jim Kahmann in Ecosystem, People, Startup

jim kahmann wp My boss just returned from a trip to Palo Alto, California ostensibly to raise capital, but also to make connections with new networks. He felt energized by his meetings, new connections and old friends from Apple. The most obvious source of this energy emanated from the hundreds and thousands of courageous, nothing-to-lose, and arguably masochistic entrepreneurs. Palo Alto and similar startup Meccas have a seemingly limitless supply of human entrepreneur-capital.

E-capital is clearly our region’s greatest need. We must all work to energize and expand the community of courageous, masochistic entrepreneurs. Startup “energizers” like the Brandery, UpTech, CincyTech, and now Cintrifuse pump jet fuel into startups. Our next challenge is spreading word outside the area, and bringing talent – specifically, human e-capital – back to the region.

Attracting more Venture for America fellows to our startup companies is a great start. This May, Venture for America launches its second class – 100 fresh undergrads from top universities. After joining VFA’s first class, I moved to Cincinnati to join a web-based logistics startup called OneMorePallet. Six more VFA graduates also joined the startup world here. We represent Columbia, Georgetown, Cornell, Duke, The University of Maryland, and Wesleyan.

You’re probably asking yourself, “Are polished, fresh-out-of-school, unseasoned yuppies the right kind of e-capital for Cincinnati’s entrepreneurial machine?” My bias is obvious, but I will emphatically argue, “YES!”

Reasons being… we are smart, we are hungry, and most importantly, we believe we have very little to lose.

It may be counterintuitive, but this “nothing to lose” mentality is why Cincinnati’s entrepreneurial community thrives with Venture for America. VFA provides new options to university graduates who might otherwise become investment bankers, consultants or lawyers, but don’t want to join the dark side (just kidding). With VFA, Cincinnati retains its own talent, attracts talent from the coasts, and transforms college grads into hardened entrepreneurs.

Career decisions are all about risk versus reward, right? The salaried lawyer/consultant track seems pretty stable when compared with a bootstrapped startup like OneMorePallet. In that light, joining a startup seems very risky. Risk is perceived and varies by situation. People with nothing to lose can’t help but focus on the reward and are that much more likely to take risks others cannot. These people represent human e-capital startups need.

We all have a standard of living we can’t imagine losing. Most likely we stand to lose our “comfort assets.” As Guy Kawasaki caveats in his book Reality Check, trust fund babies who stand to lose their many comfort assets are unlikely entrepreneurs. On the other hand, having lived on $20 per week for months at a time, I believe having few “comfort assets” is really not so bad.

Though joining a startup seemed unfamiliar and even menacing, I realized I had nothing to lose.  If my company failed, or if I discovered that entrepreneurship wasn’t for me, the world would not end. My family would be willing to let me come home (for a while.) I would have been nuts NOT to join Venture for America.

Low risk perception does not lower work ethic. Neither does it lower ambition.  A person can be pushed forward by fear, but also crushed. The pull of reward knows no bounds. The rewards of entrepreneurship – living in a world of your creation, making your rules, and the satisfaction of self-made wealth – are far more powerful forces.

Cincinnati’s startup community needs more e-capital; entrepreneurs with smarts, the perception of low risk, and the vision of unlimited rewards. VFA applicants have a once-in-a-lifetime opportunity to strike out on their own, to build new ideas into real organizations, and to rebuild entire cities. Cincinnati needs human e-capital for its startups, and we know exactly where to look.

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Comments
  1. Karl Treier says:

    I don’t think e-capital is what is missing from Cincinnati, and while I don’t decry the value of a great education many of the worlds most successful entrepreneurs had very little formal education.

    • I think we have more than we had 10 years ago, and think that the more we have, the more we can do. I frequently note that Bill Gates, Steve Jobs and I were all born in 1955, but only one of us graduated from college (should I have taken another path? – probably not or I wouldn’t have landed in Cincinnati.) That being said, we can use all the talent we can get — and Venture for America brings passionate talent — they just happen to come in the form of recent grads from universities.

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