The world of entrepreneurship is changing. In 2020, every entrepreneur has encountered unexpected obstacles on the road to building a high-growth startup. The first 30 days of lockdown were packed with change for entrepreneurs and everyone around them. Layoffs at companies both large and small have created first-time entrepreneurs – new business applications are growing at the fastest rate in a decade. The timelines towards economic recovery and stability remain speculative at best.
These shifts have disrupted entrepreneur support organizations (ESOs) considerably, as many have had to reinvent themselves these past few months. To fulfill their mission, entrepreneur support organizations need to evolve the places, people, programs, and policies they cultivate.
The places of work must evolve. Between the implosion of WeWork last year and the ongoing pandemic, shared spaces have taken a huge hit. Social distancing restrictions forced the temporary closure of coworking spaces, and even with reopening, people remain wary of communal facilities and large events. The graph below illustrates this trend in the form of conference room bookings on Union – a sharp drop followed by a slow, cautious return to workplaces. This trend could reverse with any spike in cases of the virus later this year.
While entrepreneurs don’t need physical office space right now, they still need “places” to learn and grow. As virtual-first has become the new normal, many organizations have experimented with new tools in an effort to recreate the serendipity that once occurred in their spaces. With proactive community management, these places for entrepreneurs can be even more accessible, inclusive and impactful than ever before. Startup community leaders must embrace this new reality and prioritize these new spaces if entrepreneurs are to thrive.
The people receiving support must evolve. The Black Lives Matter movement in the US and abroad has brought a widespread social reckoning that’s both essential and long overdue. It’s no secret that the tech industry is rife with systemic, terrible inequities for people of color and marginalized groups. A recent Kauffman report concluded that this lack of diversity is not due to a pipeline problem, but rather the result of exclusionary hiring practices and siloed professional networks.
Many people and organizations have only just begun an earnest effort to reflect internally and actively work to reverse this trend. In the past few months, Union has seen a surge in activity among communities that work explicitly with underrepresented founders. While this trend is positive, much work remains. Startup community leaders must make diversity, equity and inclusion core to their goals if genuine progress is to be made.
The programs for entrepreneurs must evolve. Experienced program leaders know that the template 3-month accelerator program cannot be copy and pasted - it requires pragmatic application based on context, audience and rigorous evaluation. In recent months, new programs have launched to fight the pandemic,, support furloughed employees and help startups adapt to recent challenges. The lines between time-based cohorts and alumni networks have blurred, inspiring many organizations to explore new models. The best-in-class organizations have introduced adaptive virtual-first programming designed to address the unique needs of their startups in real-time. The graph below demonstrates a trend towards rolling programming across our platform.
As social distancing restrictions ease, hybrid models that balance in-person camaraderie with virtual accessibility will thrive. The most successful organizations will find creative ways to recreate the in-person bond among peers. For entrepreneur support organizations, program goals must shift from output (“We have 10 startups pitching at Demo Day!”) to outcomes (“These startups closed $2M in new revenue last quarter”). Startup community leaders must reinvent their programs to meet entrepreneurs where they are and serve their most pressing needs at scale.
Lastly, the policies around entrepreneurship must evolve. Despite relief from massive stimulus packages, undercapitalized startups continue to struggle with fresh rounds of layoffs or the threat of outright closure. The US has seen its PPP program expire, while the UK braces for the end of its furlough program and countries like India race to enact measures to avoid economic catastrophe. The graph below shows that Google Searches for the term "PPP loans" spiked at the start and end of the program, while the term "layoffs" has remained consistent.
While this data is broad, it exemplifies the continual struggle facing startups and small businesses. The slow pace and fallout of these insufficient policies has taken its toll, hitting smaller ecosystems and underrepresented founders the hardest. A massive pool of unemployed talent needs skills and support. Startup community leaders must call on local, state and national governments to enact and uphold meaningful policies that protect and develop equitable entrepreneurship.
People with experience at entrepreneur support organizations know that reinvention is an essential practice. The places where startup magic happens has changed, and virtual-first community management has become a key differentiator. The people receiving support must expand to prioritize true equity in access, opportunity and culture. The programs we operate must become adaptive, flexible and outcome-driven. The policies we back must incentivize and sustain inclusive innovation.
The massive shifts of 2020 have brought incredible challenges, but with them come new opportunities: to cultivate new spaces for ideas, to help the underserved build businesses, to create programs that iterate at startup speed, to demand policies that serve all. Startup community leaders must seize these opportunities and empower a new, hungry wave of entrepreneurs to reach their full potential.