By Ted Zoller
If there is a universal of truism in entrepreneurship it would be that successful entrepreneurs typically attribute their success to the community that gave them their big break. All demonstrate some measure of gratitude for their success and most feel responsible for somehow paying it forward and giving back. I call this the cycle of reinvestment.
Without reservation, when I ask first-time entrepreneurs what they will do when they achieve their goal for the company and “cash out,” a few admit they will take care of their own financial needs first, but almost all will say they’ll start another company. There is something about the entrepreneurial archetype that leads founders to do it all over again – build, launch, exit, repeat. Between ventures, they “reinvest” in their community through what they do best as entrepreneurs — creating and building – through their business pursuits, personal social passions, entrepreneurial coaching activities and community service.
Specifically, successful entrepreneurs typically give back in a number of different ways:
Current and future business engagements and investments
Developing and coaching of emerging talent
Civic pursuits and community service
Social pursuits and philanthropic activities
Most follow their passion, and contribute all of these in parallel. However, the degree to which an entrepreneur “reinvests” varies greatly, particularly among first-time entrepreneurs who lack role models and, quite frankly, are often are not asked. While undoubtedly some escape to the beach or the mountains (or both), most are extraordinarily generous. One such example is Facebook founder Dustin Moskovitz, who not only has signed the Giving Pledge to give away the majority of his net worth to charity, but continues to engage by serving on boards, investing and, in his case, building new companies. One hundred and twenty-seven billionaires have signed the pledge, most of whom are founders.
Serial entrepreneurs – founders who have established two or more ventures — are sought after by first-time founders for their experience, their knowledge of the market and their insight on how to build and scale a company. But serial entrepreneurs are a rare breed, comprising less than 10 percent of all founders. Serial entrepreneurs who found more than two companies are rarer still, accounting for less than 2 percent of all founders. These super-serial entrepreneurs are the market-makers and mavens that fuel entrepreneurial economies, yet this precious expertise is not always tapped by entrepreneurial communities. Mainly because they are seldom asked to play a role.
That’s where the Blackstone Entrepreneurs Network (BEN) comes in. BEN — a new model in entrepreneurial networking and mentoring – engages a region’s most accomplished serial entrepreneurs and gives them a job: to promote the performance of the regional entrepreneurial ecosystem.
Again they focus on what they do best: helping founders build their companies. You can think of the BEN entrepreneurs as a talent agency for the region’s entrepreneurial economy. While myriad programs, accelerators and incubators and resources are available to support startups in a region, BEN instead supports the most promising entrepreneurial companies that have the greatest potential to scale and the “grow ups,” or companies that have already proven themselves in the market and have demonstrated market potential.
BEN amplifies and unleashes the serial entrepreneur’s natural tendency to “give back” and serve. It accomplishes this in two ways:
First, by directly mediating valuable relationships among startup entrepreneurs and important contacts both inside and outside the region that lead to market traction, capitalization and awareness.
Second, by creating a culture of “giving back” among serial entrepreneurs, which leads to sustainability and reinvestment in the entrepreneurial network.
Like the Giving Pledge, BEN creates an expectation and celebrates the successful entrepreneurs who take it upon themselves to serve the community that supported them. In a sense, BEN entrepreneurs serve to recruit and retain the region’s entrepreneurial talent by engaging them in the work of supporting the next generation of entrepreneurs.
The Blackstone Entrepreneurs Network is a bold experiment. With the support of the Blackstone Charitable Foundation, two pilots have been launched: the first in Research Triangle Park in North Carolina, and the second in the Denver-Boulder region in Colorado. BEN is predicated upon the theory that the network of active serial entrepreneurs bring about both a pragmatic and cultural change in the region, building a “flywheel” or “generous cycle” of successful entrepreneurs who seek to reinvest in the entrepreneurial ecosystem that gave rise to their venture.
This generous cycle of enhancing the social capital of the entrepreneurial network and producing greater cohesiveness and strategic leverage over time improves the performance of the entrepreneurial network and pays economic dividends to the region as an entrepreneurial economy. While BEN directly builds a network of experienced entrepreneurs to support emerging founders, it also creates momentum for the evolution and development of the region’s entrepreneurial network, allowing it to improve more rapidly than if BEN did not exist.
In this manner, the Blackstone Entrepreneurs Network not only serves a purpose as an innovative economic development strategy, but as a replicable model to enhance the performance and capabilities of entrepreneurial networks in every U.S. metropolitan region. BEN, therefore, is a bold experiment that promises substantial economic returns. We look forward to the results generated by the leadership of the serial entrepreneurs engaged in the North Carolina and Colorado pilots. The results will be tracked and articulated as a model for the next generation of entrepreneur-led economic development in the United States and beyond.
Zoller is director of the Center for Entrepreneurial Studies at UNC Chapel Hill and incoming president of the United States Association of Small Business and Entrepreneurship. He is a consultant to the Blackstone Charitable Foundation.
The illustration is from a 1960 guide to the Research Triangle Park in North Carolina.