Over the past five years, entrepreneurship and “creating a Startup” has achieved critical mass, it is a globally accepted career path and has gone mainstream. Virtually every country now has Incubators, Accelerators, Corporate Innovations Centers and Co-Work Spaces. Statistics point to a future where corporations outsource R&D through startups, global demand for intelligent solutions feed the market and 40% of adults are working in the Shared economy. The way we learn and become socially responsible adults are changing; for many, it will not be the College route. However, I still like the idea of our Doctors, Scientists, and Mathematicians staying in school.
So, what does this mean and what is driving the change?
Let’s begin with the catalyst that is driving the change – global adoption of what we call the “Startup Model.”
What is the “Startup Model” and why is it different?
We loosely define three core Business Models (there are endless hybrids)
- Traditional Model – taught in school, based on long-term ownership and managed debt; the dynamics would b driven by the ability to borrow and manage cash flow.
- Franchise Model – based on buying the infrastructure and brand; dynamics are driven by wearing the uniform and following the rules to success.
- Startup Model – based on private investment and equity share; dynamics are driven by community ecosystem, explosive growth, and acquisition.
The Silicon Valley is the benchmark for an Innovation or Shared Risk Ecosystem; is the result of over 45 years of experimentation and refinement. We won’t go into the discussion of “can the Silicon Valley model be applied globally.” Short answer yes it can, but not the same way.
What is a Shared Risk Ecosystem and why does it matter?
According to Lean Startup; “A startup is a human institution designed to deliver a new product or service under conditions of extreme uncertainty.” It is worth noting that nowhere does it say create a company.If you look at Webster’s Dictionary; An Ecosystem is a community, together with its environment, functioning as a unit.If you bring these together, the common thread is working together to deliver. In the “Startup Model” this community is called a Shared Risk Ecosystem. It is shared risk because everyone is working on equity payment for eventual exit; we are all in this together. So, the purpose of a successful ecosystem is to commercialize ideas, that’s it. The results will be economic growth, job creation, business diversity to name a few.
So, what about the Incubators, Accelerators, etc. replacing Universities?
Now that we have gone full circle back to the original point, Incubators/Accelerators have two simple purposes 1) provide quality deal flow to the ecosystem and 2) provide the ecosystem frictionless, value-added access to the startups. If both are working success will follow.
The Incubator/Accelerator is the centerpiece of the Ecosystem, where entrepreneurs with great ideas transform into quality solutions to the world’s problems. We believe the process of turning entrepreneurs into successful serial entrepreneurs in “real time” will replace the college path for many.
We believe two core community elements drive learning and success.
- Resources provide experience such as mentors, subject matter experts, experience from the local community
- Enablers provide a tool or service such as coders, accountants, legal, manufacturing, engineers.
These elements are also the entry point for local businesses and individuals to participate and monetize:
Ok, so this is more or less happening all over the world (in varying degrees of effectiveness) what’s next?
We believe the commercialization of the “Startup Model” will follow the same path as any other newly adopted approach; the industry will begin to establish standards, standard language metrics, etc.In simple terms that are why we believe the Innovation Centers of the world will replace Jr Colleges and Universities for many students.The future of innovation will drive private investment through shared risk ecosystems and global teams.