By Rich Figel
PROGRAM ALERT: The new August episode of Career Changers TV begins running Saturday night at 8:30 pm on OC16. Please visit www.CareerChangers.TV for other daily viewing times. You can also watch segments from the show on the CCTV YouTube Channel (low res versions).
For the past few months, I've been telling people that what I'm hearing on the streets in Honolulu is things are looking good for businesses despite all the negative national headlines repeating messages of doom and gloom. Granted, the job outlook hasn't improved much for certain segments of the population -- but if those who are unemployed haven't upgraded their skills or changed their job hunting strategy, their prospects aren't going to change either. And yes, the uncertainty of what's going to happen with Europe's economic house of cards is a legitimate reason to worry about the future of big global corporations with stakes in those markets.
Yet I keep seeing evidence that good old-fashioned American entrepreneurship is not only alive -- it's thriving. It's like staring at the ocean in vain for glimpses of whales breaching, when right in front of you there are tidal pools teeming with tiny sea life that go unnoticed. Okay, that might be a slightly tortured metaphor to tie in my current show's Sea Life Park theme with the Startup Hawaii conference I attended yesterday, but I think it actually makes sense.
The "whale" everyone came to see was Steve Case, AOL co-founder and chairman of the Startup America Partnership, which is a bipartisan offshoot of President Obama's Jobs Council initiative. As Case noted, they were able to get Republicans and Democrats to come together on creating programs that would encourage innovation, while providing incentives for startups that can help boost the economy. So, you see, it's not impossible to find some common ground to build on.
What I found most interesting about Case's on stage discussion with Howard Dicus was that his key points mirrored what earlier speakers told the 300 plus attendees -- and those speakers ranged the gamut from local entrepreneurs who laughed about launching their ventures with less than $300, to executives at major investors in startup companies. In fact, George Kellerman, a venture partner out of California (went to UH) joked that Case's five positive reasons Hawaii can be a major player in startup innovation, sounded like Case cribbed notes from Kellerman's morning presentation.
Both guys, along with other panel speakers, noted Hawaii is a gateway to Asia; can attract talent because of our lifestyle ("brain gain" instead of brain drain); we have local wealth that can be tapped into, from successful folks who live here part-time or have moved to Hawaii; and it's much cheaper now to start a new biz, especially in the high tech or social media arena.
Which is what I am seeing and hearing on a daily basis. You no longer need to invest tens of thousands in computer hardware and hire high-priced programmers and engineers to launch a new internet-based company. What's more, there's been a proliferation of startup "accelarators," which are sort of a combination of venture capital investors and incubators. It works like this: someone like Kellerman's company, 500 Startups (name inspired by Dr. Seuss 500 hats book) will provide $50K to $100K in financial backing for a startup they like. They also provide physical space and mentors to offer guidance. If it goes well, they may "double down" on their investment for another year or two -- he says about 20 percent of their 350 investments so far fall into that category. In return, the accelerator gets a small percentage of the startup company's stock or equity -- around 5 percent but it varies depending on the potential. For instance, one of their early investments was Wildfire, which provides advertising services for Facebook... Google just announced they are acquiring Wildfire for $50 million. Kellerman wouldn't say how much 500 Startups will get for "exiting" that investment, but I think it's safe to say the return will be quite handsome.
That kind of payoff is making the accelerator biz very competitive. But the ones I met yesterday say their philosophy is based on the "pay it forward" model because in their own cases, many of them benefited from the help and guidance of successful mentors. There's much more I'll share when we air these segments next month on Career Changers TV. My question though is where was the local news media yesterday? I found a number of interesting stories -- local successes, national successes with Hawaii connections -- and the only news story I saw come out of that was on KGMB since Howard Dicus was able to get Steve Case to do an interview on camera.
I guess if the organizers wanted to get more local news coverage, they should have set the Sheraton Waikiki on fire or crash a car into the hotel lobby. Anyway, speaking of positive stories about startups in Hawaii, in our new episode we have a segment about an offshoot of Bess Press publishing called Pass the Projects. They're creating interactive apps for smart devices that combine traditional print media with digital media, including a very cool app for Sea Life Park. Here's a sneak peek.
Have a great weekend!