Clark Dever discusses the benefits of fostering start-up ecosystems at universities and large corporations.
Techstars is one of the biggest and most recognisable names in start-up accelerators, with incubators and other programmes running all around the world. The US-founded organisation is expanding in Europe and plans to invest in more than 100 start-ups in 2022 through its accelerator programmes in seven European countries. Last week, it also announced it would run a blockchain-focused accelerator in Dublin.
Clark Dever, who until recently was a senior product manager at Techstars based in New York, is deeply familiar with what makes for a successful start-up community and how establishing one can deliver benefits to organisations.
‘Ireland is becoming a very strong fintech start-up community – different regions develop start-ups around an industry or technology, because there’s a gravity well that happens once you get a unicorn’
– CLARK DEVER
What kind of benefits do both corporations and universities get from creating internal start-up ecosystems?
From a university side, it comes down to market demand. Students are more and more interested in entrepreneurial ventures and the creative economy. There’s lots of reports on how school kids want to be involved in that as opposed to being sports stars, or whatever used to be the answer. I also believe that if you’re looking at it from a business perspective, to not have this kind of venture-backed entrepreneurial curriculum in your business school, you’re missing out on a large subset of the business world right now, and frankly where a lot of the innovation in the future of the economy is.
On the corporate side, an important factor is market intelligence. When you’re working for a start-up, you can ship product before a corporate competitor can even have a meeting to discuss the market opportunity. So corporate VCs often have a team whose entire job is to keep an understanding of what the future of the market might be, and then invest in those companies. Those start-ups have a little bit of an insider view and corporations can learn from them, and maybe have a better chance of acquiring those start-ups than their competitors.
If a corporation successfully integrates in the start-up community by sponsoring events or hiring people out of companies that have recently failed, they get the DNA and the development operations from that community. They get new tools new perspectives that maybe they don’t have internally right now, but may be the standard in the venture-backed start-up world. And so that increases, at least slightly, their agility and their ability to compete.
It sounds like, for both universities and corporations, it’s about disrupting the existing ways that they do things and giving start-ups the freedom and the money to break the rules a bit and to move more freely.
Yes, and I think it’s also important to realise your place in the ecosystem. One of the failure modes, particularly for universities, is that they start to believe that their little business unit focused on high-growth entrepreneurship represents a large part of the start-up community. They start to take ownership, saying ‘We’re a major start-up community organiser.’ No you’re not.
You’re a player, but you’re inside your own echo chamber, and what you should really be trying to do is integrate as deeply as possible with the grassroots community outside of campus. Encourage students to go to meet-ups, and then open your campus to bring outsiders in for that kind of permeable knowledge exchange. There’s a lot of academic understanding of start-ups, but oftentimes the people that run these start-up educational programmes inside of universities haven’t actually been founders. There’s a huge difference between reading Eric Ries’s Lean Start-up, and building an MVP yourself.
What advice do you have for prospective founders deciding where to attend university or make their next career move?
On the university side, it might be heretical to say, but I think if your goal is to be a founder you shouldn’t go to business school. If you want to get your undergraduate degree, get it with a focus on an industry. Become an engineer or become a scientist. And then, instead of going and getting your MBA, go start your business.
Worst-case scenario: you spent the money, you learned a lot and now you can go get a higher-level job at a corporation because you have such a diversity of skills and experience. Instead of being a manager, you might be a director or vice-president, because you were CEO of your own company.
Alternatively, let’s say, as a founder, you want the shelter of a corporate environment but you’re interested in emerging technology. I would go do the research in the parts of the emerging technology world that you’re interested in, see what corporations are investing in that space, see which ones have accelerators or corporate venture capital, and generally do your market analysis.
How well do you think Ireland is doing in fostering that kind of start-up culture, in our universities, corporations and accelerators?
I look at Ireland and one notable thing is Stripe and their commitment coming back to Ireland to hire thousands of people here. Those initial exits provide opportunity. The other Irish founder I think of is Connor Murphy. He had an exit, and now he’s back. He’s in Bray and he’s building a company called Bridge, whose product I’m a super user on.
So there are Irish nationals who have had major international exits at this point and that creates a basis for the next wave of founders coming up. Because now you have experts that are available to give advice. I recommend to all founders, reach out to any other founder you want. It doesn’t matter if they’re in the press or otherwise high-profile. If you’re legitimately founding a high-growth start-up and you have any form of validation, almost any founder will answer your email. Because they were once just like you, and they remember that pain and how hard it is to go to that next level.
That’s where Ireland is right now. The country is also becoming a very strong fintech start-up community. Over time, different geographic regions develop start-ups around an industry or technology, because there’s a gravity well that happens once you get a unicorn. That company is able to bring in top tier talent from around the world, and those people spin out, and so it becomes self-propagating.
We see that in Silicon Valley with all of the social start-ups. We see it in Boston, with all the robotics and AI start-ups around MIT and Cambridge. And you see it in New York with fintech. So I think there’s an opportunity there for Ireland and I think that you’re well on your way.
As well as fintech around Dublin, Ireland also has a lot of agritech start-ups because of our strong agricultural background. What’s your take on that?
Right now, agriculture and climate tech are probably some of the fastest growth areas and the easiest capital to get. With climate change, people are truly coming to understand the urgency of it, and I think Covid really threw the slow moving disaster into sharp focus. So now VCs are thinking, ‘We need to get ahead of this. Not just because we need to save humanity, but also there’s going to be such a market for these technologies. If we can make the right bets now it’ll be hugely profitable.’
If can I leave with one final remark, I think the important thing to realise is that any region that has at least 100,000 people can have a very sustainable and impactful start-up community. And I think that a lot of cities or regions haven’t bought into that yet. Speaking from personal experience, we have 250,000 people in downtown Buffalo, New York, and maybe a million people in our metropolitan area, and we have about a 5,000 person start-up community. We built that over two years. So it’s not impossible. All it takes is people really being willing to go out and connect with each other.
Covid has accelerated so many things. It used to be that you wouldn’t be able to get Silicon Valley VC in Ireland, but today you can because all the VCs have been working over Zoom meetings, and they realise that it’s no different. You don’t have to be on Sand Hill Road to get capital out of Andreessen Horowitz at this point, and I think that’s a huge opportunity as an international founder.
So don’t be afraid to try and move the big names. When it comes to capital or wisdom, email those folks, email the founders if you’re a founder, and they will respond.
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