Recently, my friend Ross Baird came out with a new book, The Innovation Blind Spot. In the book, Ross outlines and diagnoses a problem that Iâve been exploring for over a decade: our innovation economy neglects many people and ideas.
Ross kicks off the book with some pretty stark statistics: despite the fact that promising startup communities (such as my hometown of Boulder) are thriving, in most communities in America, firm creation is the lowest itâs been in a generation. With women making up less than 10% of new startups that are funded and African-Americans and Latinos making up less than 1%, itâs obvious weâre not seeing the best ideas in our innovation ecosystem.
Rossâ book is important because he focuses on solving this problem through HOW we invest, not just WHAT we invest in. Itâs not enough for tech firms to say âwe need more diversity â letâs go find different founders!â The design in how we find companies, perform diligence and make investments have unintentional side effects that cut many people out. One example highlighted in the book is that the very act of âpitchingâ a business tends to favor men (a Wharton study showed that men were 60% more likely to raise money pitching the exact same business as women.)
Iâve been thinking about ways to design startup communities to be more inclusive. A classic investor problem is a tension between wanting to be accessible to new founders while at the same time giving existing portfolio companies the time they deserve. When youâre getting a thousand pitches a year, you often tend to gravitate towards the people you already know and ideas that are familiar. Techstars has been a key part of addressing this issue for us as weâve met thousands of companies we wouldnât have otherwise and have invested â both directly and through our investment in Techstars â in a wide variety of founders all over the world.
Rossâs book also explores ways to build a stronger pipeline of different types people. As Iâve dug further into the problem, Iâve seen consistent ways that many people are excluded. For example, entrepreneurs go to conferences and network in order to find customers and investors. If you donât have personal savings or family members who can help support you, you canât afford that plane ticket. Organizations like the Techstars Foundation are working on addressing problems like this.
My favorite part of the book is when Ross talks about how places and communities can support their own founders. Rossâ final section is titled with one of my favorite words: âTopophiliaâ, or âlove of placeâ. Itâs a phrase Iâve embraced as weâve built our startup community in Colorado and have tried to share with other communities around the world, both in my travels and through my book, Startup Communities. Whether you live in Cincinnati or Jakarta, you are far better able to help the entrepreneurs in your hometown than I am. I think that in order for us to ensure that entrepreneurs flourish everywhere, communities need to embrace them, and Iâve enjoyed being part of a community of folks like Ross who are trying to help communities do this worldwide.
Rossâs book is a quick, entertaining, informative read that diagnoses how we can do better as a startup community, and more importantly, focuses on the HOW. I encourage everyone in the innovation economy to read it.
Also published on Medium.