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As the presidential campaign heats up, we are hearing plenty of promises from each candidate that they will bring jobs to the American economy and rebuild the middle class. What we are not hearing is a persuasive case for just how that will happen.
Hiding in plain sight and providing a big part of the answer to the jobs question is an entirely new form of business that has taken root across the nation. This new style of business is an enterprise that typically starts small and is run by a small group of highly motivated people willing to put in long hours for little pay. But these entrepreneurs have no intention of staying small. They fully intend to see explosive growth as quickly as possible.
This new form of business signals the dawn of the Innovation Age in which an enterprise can go from idea to unicorn with breathtaking speed. It is a form of business unprecedented in this nation, indeed in the world.
Uber, founded in 2009, is valued at north of $60 billion. On its way is Chicago-based Avant, an online lending platform that was founded in 2012 and now has a valuation of about $2 billion.
Here in Chicago an innovation ecosystem has sprung to life over the last 15 years that includes new startups seemingly every day, over 80 incubators or co-working spaces, a thriving venture capital community, and innovation programs in every college and university.
Now look nationwide. A recent issue of Peoria Progress magazine reports on Startup Peoria, launched in 2013. In Texas, El Paso offers “The Hub of Innovation—El Paso’s Technology Incubator.” Go to Maine, and you will learn about the Bangor International Enterprise Center, designed to encourage that community’s startup community.
The 2015 Kauffman Index of Startup Activity estimates that there are 530,000 entrepreneurial startups each month in the U.S. These are startups of all types, not just those designed for explosive growth, but it suggests the extent of this new business form.
This is a gift horse for the politician who recognizes it.
Rather than bromides about recovering the nation’s past manufacturing glory, how about embracing the full potential of these new businesses that are springing up in every city, town and rural region of the nation? A logical step would be to establish a cabinet-level position—call it the secretary of innovation—charged with giving the Innovation Age the coherence it needs to thrive.
Here’s what that new secretary should do:
• Clear the way. Policies should be developed and put in place to advance the efforts of those whose business model is predicated on explosive growth.
• Build connections. Explosive growth can happen in many different ways. Policies designed to encourage connections among firms of all sizes will trigger American-style dealmaking.
• Coordinate. Useful initiatives already exist. Challenge.gov, for example, has hundreds of sponsored competitions looking for innovative solutions to specific problems. Such could be brought together under the office of the secretary.
• Build the innovation mindset. Approaching the challenges of government with the same spirit of innovation that is emerging in the private sector might help with the gridlock mentality that has set in.
The leader who recognizes the full potential of the Innovation Age and builds a policy agenda to support it would surely capture the imagination (and votes) of a broad cross-section of the American people.
–Thomas Kuczmarski is president of Kuczmarski Innovation, a Chicago-based consultancy, and author of six books on leadership and innovation.