There are many different ways one can segment entrepreneurship. Some like personality characteristics, some like descriptive buckets and others prefer stages. I would like to draw from Steve Blank, and the way he outlines four types of entrepreneurship.
My parents would identify most with small business endeavors as entrepreneurship. These are local firms in the community that fill a need and for the most part used bootstrapped savings to grow. These companies were driven to understand the customer to provide value as it did not have the luxury of large capital injections. These companies grow organically and include florists, donut shops, coffee shops, chiropractors, and practically every type of business imaginable. Every small and big town across America has them, and they are the economic engine for our communities – in many regards, they are our communities. Some of these companies do end up scaling to a larger market and become the success story we all like to embrace.
These companies are what most people may think of where they hear the word entrepreneurship. These are venture-backed businesses that have a product or service that investors hope can scale incredibly fast to capture market share and revenue. These bets are investments for the venture capitalists (usually Angel investors initially), and over some period (5 to 8 years) they are expecting a return on the capital invested. Silicon Valley has been the mecca for these types of companies and has done a pretty good job of funding the scalable startup. Some example companies include Facebook, Google, and PayPal. Most large cities have some venture capital, and Austin is no exception. Some venture-backed companies in Austin include data.world, Unaliwear, and NarrativeDX.
Social Impact companies are companies that may be a small business or even venture backed but have a mission to benefit the community in some way – or have a “social impact” for good. It could be to address homelessness or water quality or milk for infants. These companies may be funded by family offices, Angels, foundations, and increasingly venture capitalists. The rigor for the types of investment is just as stringent for a scalable startup, but the metrics defining success are not always just revenue and market share. As the name implies, the social impact success is just as important as the bottom line. Some examples of social impact companies include PenPal Schools, Agora, and NurtureMe.
Yes, large corporations can be entrepreneurial. They may need to develop a new product, service, or process or expand into a new market. They may need to reinvent themselves as the market changes to gain new customers. For example, AT&T once known solely as a land line telephone company is now an entertainment (Uverse) and mobile phone company. The skills needed to bring these new products and services to market as the same as small business, scalable startup, and social impact entrepreneurs.
Entrepreneurs come in all shapes and sizes, and their motivations may be very different. Some are drawn to lifestyle businesses or the challenge of doing something new over and over again. Some like the freedom to set a direction on their own. Regardless, the common thread among them all is problem-solving.
Whether our children grow up to work for or start a small business, scalable startup, social impact venture, or a large corporation, problem-solving skills will be needed regardless of where they land. Instead of asking kids “What do you want to be when you grow up?”, maybe we should ask, “What problems do you want to solve in this world?” Pitch-a-Kid exposes kids to problem solvers in different occupations and careers within a variety of industries. It allows them to see some of the best problems solvers we have and learn what they do it, how they do, and why.