Experts Tell Congress: Help Startups Grow Outside the Valley

Kira M. Newman Feb 1, 2013 Tweet

In testimony before the House Caucus on Innovation and Entrepreneurship last Tuesday, experts from the startup industry urged Congress to support the growing startup scenes outside Silicon Valley.

The caucus meets regularly to discuss entrepreneurship and learn from people in the industry. Its goal is to preach the importance of entrepreneurship to the rest of Congress, and promote legislation that benefits small businesses. Donna Harris, a managing director at Startup America and cofounder of 1776, testified last week to remind congressmen of their power off the congressional floor.

“People’s minds always go to legislation,” says Harris, who testified alongside Jeffrey Bussgang of Flybridge Capital and Al Watkins of the Global Innovation Summit. “But there are many other things that these members of Congress can do.”

For example, she encouraged congressmen to use their spotlight and “pulpit” to shine a light on startups and entrepreneurs in their districts. She advised them to read about the tech scene and meet with promising startups to truly understand their work. And, of course, to recognize the difference between a startup and a small business.

The response, she says, was promising: some talked about the startup scenes in their home states, others appreciated the tips, and a few followed up afterward to learn more.

“I’m pleased that I see members from both sides of the aisle really understanding the importance of entrepreneurship and coming together to talk about how this is really not a bipartisan issue,” says Harris.

Here’s an outline of her full testimony, which I summarized from her notes.

Startup scenes are sprouting outside Silicon Valley because startup costs are lower, capital and knowledge are more widely available, and organizations like Startup America, Startup Weekend, and TechStars work nationwide. Not only that, startup scenes can actually grow faster because older ecosystems provide us with examples of what works and what doesn’t.

Communities flourish for a variety of reasons. In successful communities, entrepreneurs take the lead, and supporting organizations like governments and universities follow. They focus on the area’s strengths, rather than trying to imitate Silicon Valley. They identify promising companies, and try to help them grow even more. By gathering entrepreneurs together in coworking spaces and neighborhoods, they create density and facilitate random connections and collaboration. What’s more, they apply a lean model to ecosystem building, testing ideas and not worrying about failures. But when they succeed, or local companies succeed, they spread those stories far and wide. Finally, they figure out ways to measure success and progress.

While individual members of Congress have a big part to play – as mentioned above – legislation does, as well. Congress should help fast-track the crowdfunding laws, reform immigration policies for entrepreneurs, protect startups from patent trolls, and celebrate entrepreneurship more formally. All of this will help fuel the economy and create jobs, outcomes that Congress is so committed to.