Good Advice for Early-Stage Entrepreneurs
These social innovators learned from experience how to get a venture to market and thrive. Take some tips from the pros.
Social innovators have a uniquely angled relationship with reality. They see possibilities where others don’t. Teach For America selects a few standout social innovators each year to receive coaching and cash awards in order to encourage this extra-determined breed to go all-in on the radical quest to end educational inequity.
This year, more than 60 experienced entrepreneurs, venture capitalists, and education change-makers judged three rounds of the Arthur & Toni Rembe Rock Social Innovation Award. Some 130 Teach For America alumni submitted projects for consideration. The judges featured here each have faced and solved many challenges in helping innovations get to market. Here, they took a moment to share some wisdom for early-stage entrepreneurs.
Alejandro Gac-Artigas (Greater Philadelphia ’09) is the founder and CEO of Springboard Collaborative, a nonprofit operating in twelve cities to close the reading achievement gap through a blended teacher-and-family coaching approach. Gac-Artigas won Teach For America’s first social innovation award for Springboard in 2011.
Q: What are some first problems confronting the new entrepreneur that she or he may not be anticipating?
A: The greatest challenge for any aspiring social entrepreneur is finding your problem. Starting a venture is so challenging and volatile that any reasonable person will jump ship. You need to feel unreasonably passionate about the problem you seek to solve.
The next task is to identify the root causes. An intractable problem, in its very nature, evades solutions. The entrepreneur’s only chance at succeeding where hundreds before you have failed is to understand the problem more deeply than anyone else. And no one understands a problem better than the people who experience it firsthand. If you lack firsthand experience, this should be your first priority. In many ways, your role is to reallocate capital, power, and privilege so that communities can solve the problems they understand best.
Q: Especially among people who are underrepresented in this sector, many social entrepreneurs get stopped before they get started. How did you work around this?
A: If entrepreneurs have firsthand experience with the social problem they seek to solve, they often lack access to capital, power, and privilege. Without the safety net that makes it financially feasible to indulge in all the risks that come with this, you have to be especially aggressive about attracting resources. I accepted a job offer at McKinsey & Company and deferred my start date in order to leverage the signing bonus as seed funding. Without it, I couldn’t have paid my rent while launching Springboard.
Q: A lot of great ideas never get to sustainability. What’s the most common challenge you see?
A: Many social entrepreneurs build cognitive dissonance into their business models. Their beneficiaries (usually low-income families) have little in common with their customers (usually high income). My advice to any nonprofit leader is to develop a business model in which the customer is as close to the beneficiary as possible (for example, charging schools for services that benefit students).
Q: Favorite resources?
Andrea Chen (G.N.O. ’04) is the executive director of Propeller, a New Orleans-based social innovation accelerator and incubator that has graduated over 200 social entrepreneurs since 2011.
Q: What’s a problem that can trip up a social entrepreneur at the start?
A: Many social entrepreneurs are ambitious and have a big vision, and we want to do all 20 parts of our vision right away. The problem is that initially, we likely do not have the capacity to do all 20 parts of our vision. And when entrepreneurs try to do all 20 things, even for two months, we see entrepreneurs end up feeling scattered and frustrated because nothing ends up getting done well. We coach entrepreneurs to start by sequencing out what must come first so that we can have that as the foundation to set us up. We are not throwing away the other 19 parts; we are just going to put them in a box, put a lid on it, and put it up on a shelf to take on when we are ready.
Q: Did you make a similar early-stage mistake?
A: We did. When we were still a volunteer-run organization, we launched an executive mentorship program with eight ventures. That was a lot. While we got some results, we didn’t get to “proof of concept.” So, the following year, we worked with two ventures and went much deeper to get to “proof of concept,” closer to what ventures would experience in a full accelerator program. We built our current accelerator program off what we learned from that second version.
Q: What’s one barrier to entry that you’d like to knock down?
A: One barrier we see with our entrepreneurs is access to capital. It is hard for any entrepreneur to raise money, and when you are a female entrepreneur or an entrepreneur of color or both, it is even more difficult. We know from both experience and data that access to capital is not equitably distributed by race and gender, even when financial attributes are equal.
That said, there’s a lot you can do without an investor. If you want to start an innovative after-school program, you don’t need a network of high-income individuals to invest before you start your program.
Q: What’s your best advice for how to transition your venture from your side hustle to full-time job?
A: This is one of the biggest milestones for the entrepreneurs we work with, and it is not an easy one to achieve. Entrepreneurs who have made that transition tend to be very focused and do what they need to do on the business side and on the personal side to make it happen. It’s often an art, not a science.
We work with entrepreneurs to figure out upfront exactly what are the minimum revenue goals they need to hit in order to transition out of, or reduce their hours at, their full-time jobs. Then all the energy and capacity they have gets focused on meeting that goal. Sometimes we coach entrepreneurs on the path to get there—whether their full-time job can transition to a part-time job or whether they can switch to another job that will allow them to work on their venture in a more focused way.
Q: Favorite resource?
A: One we find helpful is an old-school project tracker. It helps you break down the big vision into smaller, more feasible goals