In the Middle East, we’ve all heard the
arguments for entrepreneurship’s economic impact, especially its
potential to alleviate rising unemployment. Research on the impact
of entrepreneurs and the challenges they face, however, is hard to
find. That’s a gap that we at Wamda will be working to fill, in our
Wamda Research Lab. As we do so, we’ll be drawing some inspiration
from the work of the Ewing Marion
Kauffman Foundation, one of the leading global institutions
supporting entrepreneurship today.
Kauffman Foundation is known for many things, including supporting Startup Weekend and Global Entrepreneurship Week, which have sprouted startup events all over the globe. Kauffman Foundation is also famous for its research revealing that the average age of U.S. technology company founders is 39- older than many would assume, given that prominent figures Bill Gates, Steve Jobs, Larry Page, Sergey Brin, and Mark Zuckerberg all became founders in their early to mid 20s.
We recently sat down with Thom Ruhe, the Vice President of Entrepreneurship at Kauffman Foundation, to discuss how data, education, and angel investment work to support entrepreneurs. Here are his thoughts:
How has Kauffman worked to support entrepreneurs?
We are the only foundation in the world that is committed at this level to researching entrepreneurship on micro and macro-economic levels, to assess its ability to grow employment, commercialize intellectual property, and catalyze economic growth. We’re trying to demystify the topic so that policymakers and support organizations can have an informed debate, and determine priorities.
What is the best way to support an ecosystem?
Another sector that will be a priority over the next year or two is education. We've audited the entrepreneurship education landscape, and we're trying to fill the gaps, both by funding useful programs and creating our own. Our goal is to catalyze nuts and bolts entrepreneurship, not necessarily the Facebooks and Microsofts of the world, as there are many resources targeted at high-growth firms, but the underserved smaller companies that are still employing people, creating wealth for the founders, and building economic opportunities for employees.
Often in the Middle East, Startup Weekend and Global Entrepreneurship Week attract people that self-identify as an entrepreneur. How do you reach entrepreneurs in sectors like construction or food and beverage, where founders don't necessarily gravitate towards startup communities?
In my experience, the diversity at these events varies from country to country, but again, to be inclusive, we focus on education. If we have a curriculum or an educational program that can solve an issue that these entrepreneurs need at that moment, then we can start a dialogue with them. We also try to be very visible in policy sectors to have a broad impact.
What are some of the most surprising conclusions that you've seen come out of Kauffman's research?
The fact that the average age of an entrepreneur in the U.S. is around 40 is at the top of the list. Another equally interesting statistic is that the age group of 55 is the most active in starting new companies. We’re not sure yet if that's due to second career aspirations, early retirement, or income loss from other sources, but we'll be watching that segment with great interest.
We’ll also be boosting low tech ventures- which impact the economy as much as any other demographic- by building a very practical curriculum. These entrepreneurs don't need yet another Lean Business Startup talk or lecture on Minimum Viable Product. Not to denigrate that approach, but we’ll be starting with topics on "What to Look for in an Angel," or "How to use Crowdfunding,” and let global communities localize the courses.
One of the biggest challenges in this region is opening up sources of early stage angel funding. How does Kauffman view that space and how does it work to educate investors?
To spur the organized angel community, we created the Angel Capital Association and the Angel Research Institute. We’ve identified a tremendous untapped potential in individual angel activity, among those who have enough net worth to invest $100,000, $200,000, or $300,000 a year. To encourage these investors, we’ll be launching a course called "The Power of Angel Investing,” and bringing it online.
What do you love the most about what you do?
It's pretty simple- I love entrepreneurship, but more importantly, I really enjoy the company of entrepreneurs. I'm also a serial entrepreneur, and next to having my kids, the most positive experience I had as an entrepreneur was seeing job growth in my firms.
My last company today employs over 150 people. In its early days, I'd come back from a sales call, and I'd count the cars in the parking lot, because I knew that behind every vehicle, there was a mortgage being paid, kids being fed and going to school, and people being provided for. I know that sounds corny, but I took that responsibility very seriously.
Now, at Kauffman Foundation, I have a platform to take something that I have a passion for assist it on a global scale. How can you not love that!?