Saturday, March 13, 2010

Startups and Growth

While it comes a day late from my little guest speaking gig in my old high school economics class - I've long believed that building businesses that solve problems is the best vehicle for change for those who want to make a difference in the world.

It's a bit of a pet peeve of mine that some people label and elevate certain problems over others with the label of "social" entrepreneurship. Using the label more insidiously also causes some to reduce expectations of performance of their business as if profit must be sacrificed to achieve a social mission when the reality is profit comes from fulfilling a social mission.

My sister (thanks Beata!) forwarded a blog post by Ben Casnocha on entrepreneurs - pointing out that all entrepreneurs are social as he quotes from Carl Schramm in the Stanford Social Innovation Review:
...regular entrepreneurs create thousands of jobs, improve the quality of goods and services available to consumers, and ultimately raise standards of living. Indeed, the intertwined histories of business and health in the United States suggests that all entrepreneurship is social entrepreneurship. [...]
Entrepreneurs typically generate a surplus benefit above and beyond the profits they reap, finds the...economist William Nordhaus. Nordhaus has calculated that entrepreneurs capture only about 2 percent of this surplus, with the remainder passed on to society in the form of jobs, wages, and value.
To this end, one thing that I worry about is that the US - one of the leaders in entrepreneurship, will kill the seeds of ambition and innovation in the guise of social reforms and regulated rigidity. On the other hand, there are efforts like this: visas for foreign entrepreneurs (BusinessWeek).

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