Back in November of last year, I wrote an energetic post for this site that in essence introduced me to the Austin tech scene. I was an emerging tech analyst that wanted to meet every startup in town! I wanted to hit every happy hour! My enthusiasm was a little frightening!
Fast forward seven months and I’ve developed encyclopedic knowledge of the city’s coffee shops. I’ve met a bevy of entrepreneurs, a smattering of local tech-focused organizations and a sprinkling of investors. I’ve become so inspired by the entrepreneurial spirit that I’m finally pulling the trigger on my own business. In short, I’ve become more secure in the knowledge that the Austin tech scene is one of the most vibrant in the nation, a fact bolstered by a continuous flow of lists that place us at the top – Forbes’ second Most Innovative City in the US and Kiplinger’s Number One City for the next decade (“arguably the country’s best crucible for small business”), to name a few.
But – and you knew there was a ‘but’ coming – everyone in town wonders where the Superstar is: the tech company that starts in Austin, is funded by Austin, and whose successful exit brings the cache that will solidify Austin as the Silicon Valley of the 21st century. (And make no mistake, that is in our grasp.)
Doesn’t it seem like we’re perpetually *almost* there, standing on a precipice with our toes hanging off? Are we waiting on some nebulous event to occur? Or can we propel ourselves into that elite status on our own terms? My hope is the latter but my fear is the former.
In order for Austin to produce a Superstar and therefore prove our savvy as a nurturer and picker of winners, we need three sectors fully participating and on board with the entrepreneur mentality: entrepreneurs (check), organizations (over-check), and investors (begin new paragraph).
Look, believe me, I know. I’ve been around long enough to know that the startup ecosystem doesn’t exist in which entrepreneurs don’t bitch about investors. There will always be more ideas than money. Period. But there’s a level of frustration toward the Austin investor community that should be acknowledged and addressed. Austin entrepreneurs are increasingly flying to Silicon Valley to seek investment, after months of futile conversations here in town. I won’t give specifics for obvious reasons, but in the last month alone I’ve talked with three startups – innovative, viable startups with real revenue paths – that have given up on Austin money and are in talks with Valley investors. One founder is so frustrated, he’s about to move to the Bay Area. He’s been looking for $200,000 for a year (!) and says it’s time to move on to “people who get it.” That, my friends, is one depressing sentence.
If the hundreds of conversations I’ve had the past 7 months are any indication, I’m not making any earth-shaking pronouncements. So how do we fix this? How do we bridge the disconnect that lies between two very important sectors who very much need each other?
I think the answer lies in that middle sector I mentioned a bit ago – organizations. We’re a city that loves gathering together and it shows in the number of groups that focus on startups. Bootstrap Austin, TechRanch, Conjunctured, Austin Technology Council, Capitol Factory – just check out this list to save my keyboard. We need a coalescence of these groups toward a common goal – integrating the folks with money comfortably into our world. I may be naive but I suspect that productive exposure to the energy of Austin entrepreneurs can only result in more meaningful relationships for everyone.
I’d go so far as to suggest an overarching board or council, one that includes representatives of every sector in the community and works toward no other goal – including profit – but nurturing and producing Superstars. What if we took that list linked above and invited one or two people from each organization to a brainstorming meeting? Would you come? Am I thinking too broadly?
A savvy entrepreneur recently told me, “Austin investors won’t start taking chances on consumer internet [companies] until there are multiple losses – big exits of Austin companies who have Valley money.” I suppose he’s right but I wish he wasn’t. I wish we could fix this problem ourselves before the Valley fixes it for us. A startup scene in which one sector assumes all the risk is one that will not sustain itself. So why not take the plunge and all assume it together?