Also featuring: Africa’s mobile money tax problem, McKinsey for Kids, and what online communities mean for the future of governance
Hi friends!
We’ve almost survived winter here. There are bulbs coming out of the ground and birds and buds on the trees and it feels like a victory just to look outside. I hope wherever you are there are signs of new life, regardless of the season.
There’s a fresh look on this newsletter and you’re reading it from a site hosted on ghost.org. Let me know if you have any issues with receipt since the transition!
As always: thanks for being a friend of this project ❤️
Emily
💡 Big Ideas
TL;DR: A piece on how I thought it would be vs how it is, and whether there’s a middle ground between entrepreneurship, startup culture, and capitalism
My year in startups is coming to an end this week, and I’ve been writing and processing and thinking a lot about why. I’ve been writing pieces on the difference between founders & entrepreneurs; the increasing divide between physical and virtual jobs and their resulting economic classes; the way we value failure; and how much I’ve come to believe you shouldn’t have to starve to do good work in the world.
It’s been such an interesting journey: I’ve learned things I never even knew I didn’t know. I met amazing people and built cool shit with them. I discovered a lot of things that are the same as they are in public work, and a lot of things that are so different I had trouble reconciling them to the same planet.
The foundational problem for me is a North Star problem. It turns out that (surprise, surprise) I am not unabashedly capitalist enough to buy in to the idea that profit is the only and final goal.
Mentoring goodtech founders showed me that when you clear away all the questions about how to structure tech work for good, what you’re left with always comes down to: What’s the north star, and why?
Most of the goodtech founders I’ve worked with in the past year have more “product-market fit” than anyone I’ve ever seen. They’ve been in the trenches, they’ve worked in and with and around the problem they’re trying to solve for years, even decades. They understand exactly what the market needs and they’re building it, and they’re doing it with the benefit of real-world experience, qualified advisors, and deep passion.
And none of them get accepted into the premier accelerator programs. None of them get early meetings and referrals to big investors. None of them are getting checks.
There’s no legitimate reason that people doing good work should have to starve to do so – well, except that no one in traditional VC will ever fund them, regardless of how good their product is or how much demand they can show, because they happen to be building in a social field.
What if instead of throwing billions – like, with an actual b, y’all – at a whole bunch of founders in the hopes of finding one unicorn, we threw a million each at people building real businesses and solving real problems? Personally, I’ve learned I can never answer that question without always defaulting to want to make more money for more people, with more impact on other people, even if it meant I’d have less money myself.
If you don’t understand what I’m talking about, you’ve never worked in or for a small or medium business, or you’re having trouble stepping away from the cultural conditioning that’s screaming that your only chance of retirement is investing in what VCs are investing in, here are a few examples that might help you see what I’m proposing:
- In 2020, internet and software consumed over 47% of US VC investment.
- The industrial sector received less than 4%.
- Agriculture and energy received less than 1% each.
- Even tech & software companies that have a non-VC business model – such as sustainable profit reinvested into the business, slower growth cycles, public customers, or longer sales cycles – can’t access those funds equally, receiving less than 8% of total VC investment.
And it’s only gotten worse – in Q1 2021, just 185 US-based companies raised mega-rounds (over $100 million each) in less than three months. That’s a new quarterly record, at $42 billion in just the first quarter of last year. (And those megarounds account for 65% of the total funding in that quarter – which means fewer companies funded at higher rates).
As that report notes, “when regional economies are powered by industries that traditional venture financing shies away from…regional technology innovation may stall.” And not only that – but all regional economies will falter whether they are building in tech or not. Every business in the 21st century relies on the internet and technology in multiple ways.
I’ve discovered I’m leaving startups because I can’t support that, or condone it, or really, even make sense of it logically, financially, or ethically. If you’re concerned about it too, consider shifting your investments from large VC funds to local ones. And if you want to meet a founder you can make an angel investment in and feel good about it, reach out – I’d love to introduce you to a few.
🥑 Holy guacamole, that might actually work
Cool ideas for new ways of doing things
This week I discovered Seny Kamara, thanks to this Twitter thread shared by a goodtech founder. Your good idea for the week is to follow him, support his work, explore his ideas. Enough said. The man is a gift.
He’s on twitter, at Brown, and at algosforthepeople.
💜 Speed Dating
Public meets private, sometimes with disastrous consequences
- Digital banking has brought the lowest-income and most rural populations into the modern financial system in Africa. What happens when their governments force levies onto those services? Read more about the mobile money tax here.
🚀 Moonshot
One big idea, every week
Imagine your city was a subreddit.
Imagine if the comments and images and ideas you shared there were read and responded to and upvoted by other people who live there and the people who make decisions. Imagine it was always there – not just when there was a road project or a neighborhood park project or a ballot initiative coming up.
Community building is not new. It’s been around forever. But its shift to the virtual world opens so many doors – not just online, but also IRL.
My favorite local gov’ers, ELGL, recently hosted a webinar discussing how it’s time to move on from project-specific and required community engagement to a continuing online conversation between policymakers and people.
I know this doesn’t sound radical, but in a lot of ways, it is.
We’ve always, from federal to local, treated community engagement as a specific and time-limited element of governance. When you receive federal or state funds, there are requirements for holding public meetings, soliciting feedback, and incorporating it into state actions – but there’s an end to it, always. Even the sunshine laws around public meetings only state that you give people a limited space to speak to you – typically, three minutes per person for twenty minutes prior to the start of a meeting.
It’s not a software problem, either: places like Bang the Table and Circles.so and Public Input have all built great software that meets that need. It’s the paradigm we need to fix – and I’m really excited to see local governments, always the testing ground for new innovations in government, begin to tackle this problem together.
🥂 Upcoming Events
🤩 Our next goodtech coworking is April 1. Join us at 12 EST for an hour of chill & quiet coworking so you can focus on something you love. We’ll stop at 1 EST and do a quick round of introductions & problem sharing before we call it a wrap at 1:30 EST.
Reply to this email to be added to the invite!
📚 I’m on a curiosity voyage, I need my paddles
Books, podcasts, articles and more to feed your brain
- One of my favorite On Deck geniuses is Lais and you should read her book if anything about online and IRL communities strikes your fancy.
- McKinsey for Kids: are we training them to be high paid consultants at age 7+? I can’t even analyze this one, y’all.
- A great Vox piece on how free covid tests are only free if you can figure out how to hack your health insurance. (For my non-US friends, yes, it’s true; in America you have to jump through a bunch of hoops to get a free covid test.)
Until next time,
Emily
PS – A huge shout out to Lisa in California for being a paid subscriber supporting the goodtech community. It means so much to me 💌