Startup acceleration: what on earth does that really mean?
Is it just about speeding up the rate at which startups emerge, or making them grow faster, or just unintentionally hurrying them on to an earlier demise?
Just like the word innovation, or even ‘the precursor to acceleration’ (‘startup incubation’) this particular use of the word acceleration (probably originating in this context with leading startup accelerators Y Combinator and TechStars) is being used to mean just about anything that those involved want it to, but here at the iij we’re getting a strange sense of déjà vu.
Readers of the iij are probably more than familiar with our efforts to define the word startup: ‘Why startup is a crazy term‘, Innovation Investment Journal, April 2011.
We’ve never tried to define ‘startup acceleration’, but seeing as it is becoming an intrinsic component of national growth strategies, the time has arrived for someone to do this, and we’re feeling duty-bound to give it our best shot.
We probably need to begin with the kind of startup which is not usually (ever?) mentioned in the context of startup acceleration, but does have a direct bearing on policy related to both startups and innovation.
Maybe it’s not just about innovators
A startup which is entering into a traditional line of business (as opposed a startup based on a new invention, or with a business model which is unique, untried, or relatively novel) is not usually innovative, except that they might be the first or only business in that field (or at least in their geographical catchment) to use more modern or up to date business practices than the established businesses in the same market. Think new café. Modern and distinctive, perhaps, but innovation?
We might want to refer to that ‘process of (encouraging?) startups introducing modern practices’ as being ‘modernisation’ (a term which ironically no longer seems modern, perhaps because devotees of acceleration see their aspirations as in some way being post-modern?) rather than acceleration, but, as you’ll see, somehow modernisation is almost inevitably going to be lumped together with many other things under the startup acceleration banner (a sort of ‘no startup acceleration left behind’ ethos, which, as we’ll see, will be responsible for giving startup acceleration the ‘all encompassing’ characteristics so often featured in the ‘serious political initiative’).
Here are some examples of ‘startup acceleration’:
- encouraging new startups to form (“startups are the future of job growth”)
- supporting newly formed traditional business startups (“it’s a banking thing”)
- supporting science and engineering startups (ones with patented innovations, the venture capital market)
- facilitating scalable startups (those searching for a business model with vast growth potential on the basis of a currently speculative market vision)
- facilitating lifestyle startups (businesses started primarily for founders to ‘be their own boss’)
- encouraging bootstrapping (private individuals funding ventures out of their own income)
- encouraging social impact startups (seeking financial investment in social impact rather than profit returns)
- encouraging ‘big society’ startups (collaborating volunteers providing local services without financial investment)
Some of these ‘acceleration requirements’ are mostly about funding the startups, others less so.
But what is clear, is that many of these activities, whilst they might all form the basis of ‘startup acceleration initiatives’ are not the same thing.
Politically speaking, perhaps the thing for policy makers to be able to say is “we’re doing everything we can to accelerate startups and innovation in order to create more jobs”.
Maybe it’s not just about startups
The only thing that saying something like this will do to (further) complicate the picture I’ve given above, is that ‘accelerating innovation’ is not just about innovative or even traditional-business startups: do established businesses (i.e., ‘non-startups’, which includes established SMEs as well as much larger organisations) also need to be encouraged (in ways which go beyond existing R&D tax support) to innovate (perhaps by being encouraged to adopt more innovative business practices) in order to contribute to job growth? If so, perhaps they also need to be included in the ‘acceleration agenda’. The Kauffman report on startups identifies established businesses as sources of job destruction, but acceleration policy could be framed to include the objective of ‘turning this around’).
Maybe it’s not just about acceleration
Lastly, there is a seemingly inevitable nemesis for innovation in the context of job growth: innovative progress in what we used to call ‘automation’ ultimately potentially jeopardises jobs (the ‘replacing workers with robots’ thing).
With this in mind, promoting acceleration as a policy seems to bring with it an additional duty of care in a longer-term context than that of ‘securing economic growth as we know it’. We probably need to look farther into the future and ask ourselves what it will be like once our ‘acceleration along the path to innovation’ has driven us to what might perhaps be a relatively jobless destination.
As unpalatable as it might seem (especially as that destination seems to be a long way off, and many more urgent perils seem to deserve much more of our immediate attention) we may need to ask ourselves what ‘graceful deceleration’ might look like (a greater emphasis on encouraging traditional startups than on accelerating innovative ones, perhaps?) rather than waiting for future ‘acceleration victims’ to scorn our hubris and lack of foresight.
Here are some videos covering startup initiatives, where you may want to see if you can tease out the ‘acceleration agenda’ (although they don’t call it that) issues.
Launch details of Startup America:
Launch details of Startup Britain: