In the first part of this blog, I talked a lot about the dynamism that exists in our wealthiest entrepreneurs’ approach to philanthropy. I loosely use the term “Valley” in the title because the people I am referencing are, generally speaking, the titans of our exploding tech industry, and their approach to social impact is as nascent as their companies and the industries they’re conquering.
The direction I want to move in this second part is tying their spirit of innovation to the local level. In some ways, this will be my birds-eye view and most likely lacking in detail attempt at explaining how we can build “our own impact” here in RVA. A lot of the inspiration for this came out of an entrepreneurship roundtable the Times Dispatch sponsored at the end of March with some of our ecosystem’s major players. An audience member asked a question about whether Richmond could position itself to be a “Silicon Valley” of the East Coast in terms of startup growth in the near future. One of the panelists very candidly gave a response that resonated: Richmond is too unique to try to simply emulate other cities; we need to build our own lane. I believe this lane needs to be social enterprise.
Social enterprise/entrepreneurship is a hot topic these days and is also one I’m fairly passionate about…working for an organization like UnBoundRVA can have that effect on you. When I heard that response at the event I started thinking to myself there really isn’t a city/region that’s synonymous with social enterprise like the Bay Area is to tech or New York City is to finance. I want Richmond to be that city. Sure, our natural limitations compared to the previous two are evident, but so are our strengths, and those strengths lend themselves very naturally to a community that can be a major player in this space moving forward (to be clear: I honestly feel like Richmond is well on its way already).
The four factors I’m going to focus on in this post are access to funding, access to human capital, quality of life, and regulation and receptivity. CapitalOne and the Halycon Incubator presented these four specifically in a study they completed which detailed what goes into creating a healthy ecosystem for social enterprise at the civic level. On each one respectively:
Access to Funding: All four of these categories could easily warrant their own separate blog post, this one in particular. When broken down, it encompasses seed funding, public & private grants, and venture capital. I don’t think the “issues” for this particular problem are unique to Richmond, but are more representative of the wider landscape for start-up funding. This can be characterized, generally speaking, by risk-aversion and inside the box thinking; there will almost always be a direct correlation between funding and growth potential and not necessarily impact potential, which is what we’re truly talking about here. Where I believe Richmond can make up for its lack of total capital compared to some other major cities is through a focus on diversity. Quoted from the report: “diversifying the profile of funders and finders – more women, more people of color, more people who have experience with the entrenched social issues these innovators are trying to solve – could dramatically tip more capital into this space.” 2
Funders and finders, that’s an important distinction. There is a need for more investors (individual and institutional), accelerators, foundations, and fellowships having quick and easily accessible funding and support networks for ventures focused on impact and not necessarily growth. Perhaps more importantly, there’s also a need to bring more people into the dialogue about what change is needed based on the issues/opportunities that are present in their daily lives. Consider the following:
“Not only do more than 60 percent of US-based Ashoka Fellows (one of our four leading social entrepreneurship fellowship networks) come from the same four cites, but they are also disproportionately white, male, and highly educated. Fewer than 5 percent of them identify as Hispanic, compared with 17 percent of the US population, and only 7 percent of them identify as African-American, compared with 13 percent of the US population. Men account for 65 percent of Ashoka Fellows. Significantly, 97 percent of fellows have at least a bachelor’s degree, whereas only 34 percent of Americans have that level of education. What’s more, 37 percent of them have degrees from Ivy League institutions. Although we don’t have precise data for other fellowship networks, we have reason to believe that they generally follow a similar demographic pattern.” 1
The four cities that quote references are New York City, San Francisco, Boston, and Washington, D.C. This data suggests that successful social entrepreneurship is a bi-product of race, gender, geography, and education level, which is inaccurate. Social entrepreneurs come in all shapes and sizes. What that data truly indicates is the major players in the social enterprise movement “have internalized a set of biases that keep them from building a field that is as diverse as it could be.”1 Richmond is not a city short on diversity, and the more intentional we are about increasing the overall diversity of the people sitting at the table, the more we can learn about the amount of true opportunity that exists in the space.
Access to Human Capital: This one is a little more self-explanatory. Every city needs great people spread widely throughout the entire workforce, from senior level executives to mentors/advisors/coaches to volunteers to entry level employees. From my limited experience in Richmond, this isn’t an issue. The caliber of individuals who are committed to the growth and development of Richmond as a city is staggering. Two improvements that I think can be made in regards to human capital exist at the college level. The first is increasing learning and career opportunities in regards to entrepreneurship, specifically social enterprise. I know VCU and UR have both made recent commitments to growing and funneling more resources into their entrepreneurship programs, which is great. The second, which is somewhat a function of the first, is being more intentional and targeted about retaining the talent that exists in our local universities after they graduate.
Quality of Life: This one is somewhat tricky because it’s cyclical and less quantifiable. A lot of the social entrepreneurs that were surveyed in the study said they didn’t as much choose a city for their start-up, but were already living there. This explains the disproportionate number of social entrepreneurs in bigger coastal cities (e.g. the four mentioned previously.) Essentially the higher quality of life in Richmond should attract more people here, which in turn will increase the amount of social ventures started here. But it’s also true that the more amount of Richmond social ventures launched and developed will increase the quality of life in the city and in turn increase the attractiveness to outsiders. Either way, from a quality of life POV, it’s my very biased and non-expert opinion that Richmond can compete with any other city out there. From cost of living to outdoor activities and arts & entertainment to our food & beverage industry, we are wholly unique and indisputably dope! Plus, we have that big city feel with that small city accessibility, just keep working on that public transportation!
Regulations and Receptivity: From the report: “Social entrepreneurship thrives when governments create a hospitable environment for impact. Government’s willingness to forge partnerships, to contract for outcomes, to reduce regulatory minefields, and to convene diverse groups of contributors holds tremendous sway over the scale of social entrepreneurship within its borders.” This again, is a category that could easily stand alone as its own blog post and also one that I’m not nearly qualified enough to provide critical analysis of where Richmond stands. I do know that the recent efforts of the Office of Community Wealth Building to begin building a network of social enterprises as well as Mayor Stoney’s commitment to creating a more start-up/small business friendly environment are positive steps and indicators that our local government understands their responsibility in fostering and championing this effort, which is incredible.
As I referenced in Part I of this blog post, we as Americans are rapidly changing our opinions on the role for-profit business plays in driving social impact. My favorite quote from the report sums this up perfectly. “We have moved beyond a debate over the false choice between purpose and profit and into an economy where purpose and profit are mutually reinforcing.” 2 The emphasis on building and driving social enterprise will only continue to grow. I think Richmond as a city has a unique opportunity to cement itself as one of the undeniable leader in this space.
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