February 21, 2017

Kauffman Foundation's Report Reveals Three Megatrends That Are Fundamentally Reshaping Entrepreneurship in America

"After a long Great Recession hangover, entrepreneurship is finally rebounding in the United States," the Ewing Marion Kauffman Foundation asserts in the opening paragraph of its 2017 state of entrepreneurship report, Zero Barriers: Three Mega Trends Shaping the Future of Entrepreneurship. Moreover, "Entrepreneurs are driving a resurgence of business activity in America—in new business creation, local small business activity, and the growth of small firms into larger businesses. But underneath this reassuring surface, turbulent shifts are shaping the future of entrepreneurship to be dramatically different than what it is today, or was in the past."

The report produced by the Kauffman Foundation, a Kansas City, Mo.-based organization whose mission is to help individuals attain economic independence by advancing educational achievement and entrepreneurial success, "reveals three mega trends that are fundamentally reshaping entrepreneurship in America:
  1. New demographics of entrepreneurship: The U.S. is becoming more racially diverse, but entrepreneurs – 80.2 percent white and 64.5 percent male – do not reflect the changing population.
  2. New map of entrepreneurship: Entrepreneurship is an increasingly urban phenomenon, and it is taking place in mid-sized metros and outside traditional hubs like Boston and Silicon Valley.
  3. New nature of entrepreneurship: In the past, as companies grew their revenue, jobs would scale at almost the same pace. That's no longer true. Technology has made it possible for startups to grow revenue without as much hiring, and high-growth companies by revenue are not creating as many jobs as they did in the past."
The Kauffman Foundation provide details of a new initiative that will respond to these trends shaping entrepreneurship. "Zero Barriers to Startup" is a collaborative, nationwide effort that "will identify large and small barriers to new business creation to reverse the long-term decline in entrepreneurship. Along with entrepreneurs and policymakers, Kauffman will work to develop solutions and empower more entrepreneurs to pursue their ambitions."

The report concludes with a section titled "Areas for Further Work and Outstanding Questions," which presents several thought-provoking questions segmented in five sections about the future of entrepreneurship in the United States:

  • How is the aging of the U.S. population affecting—or not affecting—the long-term decline in entrepreneurial dynamism?
  • What is causing market gaps? How can we measure them at scale? How can we address them? Which communities are doing best at addressing them
  • Millennials start fewer businesses today than Boomers did when they were of the same age. Why is this happening? How can we address it?
  • How new is the new map of entrepreneurship in the United States? How will it change in coming years?
  • What makes ecosystems thrive?
  • How can rural areas build entrepreneurship ecosystems?
  • How can smaller metros build entrepreneurship ecosystems?
  • How new is the new nature of entrepreneurship? Is the broken link of revenue scaling and job creation a new phenomenon—or a phenomenon at all? Is it a temporary or permanent state?
  • How can we better prepare entrepreneurs and workers for the world of technological change?
  • How is the nature of work changing?
  • How can we increase the scale up potential of startups?
  • How do entrepreneurs best learn, and how can we support them more through building online and offline communities of learning?
  • How can we address the major entrepreneurship gap between people with and without formal education?
  • What is the role of a more educated United States on entrepreneurial activity?
  • What is behind the long-term decline in entrepreneurial dynamism?
  • Failure rates could be big deterrents to business starts— especially for groups without strong personal safety nets. Would reducing the failure rates help? Would it encourage more people to start companies? Could a reduction in failure rates have an adverse effect on innovation and dynamism?
  • How can we improve the safety net so that the consequences of business failure are not catastrophic for the entrepreneurs who take the leap? Would that even help? How could this affect different groups (e.g., women, minorities)?
  • What is the role of regulatory inequality affecting different communities (e.g., minority, non-minority)? How does that affect the types of entrepreneurship the communities pursue?
The report's final paragraph correctly notes that "more questions will be raised as policymakers, entrepreneurship researchers, and support organizations work to eliminate barriers to starting up. The bigger questions will be in how to resolve the challenges. That is a job for all of us."

What are your thoughts about the report? Do you have any responses to the questions above?

Aaron Rose is an advisor to talented entrepreneurs and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.

February 7, 2017

Report by GSMA Intelligence Focuses on Pakistan's Digital Future

"Pakistan has an emerging mobile industry: there are approximately 90 million unique subscribers in the country, accounting for 47% of the population," according to a report published by GSMA Intelligence. "However, the enablers of mobile internet connectivity: infrastructure, affordability, consumer readiness and content, all rank low in Pakistan relative to its neighbors. These enablers are critical to creating the right conditions of supply and demand for mobile internet connectivity to flourish. Pakistan therefore has one of the lowest penetration rates in South Asia." This report is part of GSMA Intelligence's country overview series, in which it examines how Pakistan's "mobile industry is acting as a catalyst for the development of a digital society."

The report also explores how "mobile is supporting the objectives of Pakistan's Vision 2025 strategy, which aims to transition the country into a globally competitive knowledge-based economy by the middle of the next decade, with a high quality of life for all its citizens." Furthermore, it focuses on "how the mobile industry, government and other sectors of the economy must work together – with a particular focus on tax and regulatory reform – to drive digital development in Pakistan and unlock the huge growth potential and social benefits that come with a more advanced digital society."

Importantly, the report notes that Pakistan's mobile sector is in a unique position to support the country's digital development for three key reasons:
  1. Mobile can connect more people than any other technology, particularly in underserved rural areas;
  2. Mobile can provide secure access to a variety of digital services such as health and education; and
  3. Mobile can provide a platform to provide financial inclusion, engaging many people in the economy for the first time.
Smartphone adoption has been low in Pakistan with just 17 percent of total connections. The report explains that the low smartphone penetration rate correlates to the late deployment of mobile broadband networks as well as high handset costs. "However, following the rapid rollout of 3G and 4G networks since the spectrum auction in 2014, mobile broadband services are becoming more widely available and, in parallel, smartphones are becoming increasingly affordable."

As smartphone adoption and mobile broadband usage rise in the coming years, Pakistanis, particularly the increasingly tech-savvy youth segment, will use value-added mobile services or applications. Much should be done to support the emergence of the local app economy that will develop localized content and services for domestic consumers. Support should come from Pakistan's local and national government in providing grants or low-interest loans to entrepreneurs. Domestic and international investors should also consider supporting innovative mobile technology companies. Through its Vision 2025 strategy, Pakistan could be an integral component in South Asia's mobile ecosystem.

What has been your experience of doing business in Pakistan?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

February 4, 2017

Tackling Diabetes and Obesity in an Age of Digital Acceleration in the Gulf Cooperation Council

"The countries of the Gulf Co-operation Council (GCC) are in the midst of a health crisis," according to a report sponsored by EY and published by the Economist Intelligence Unit (EIU). "Close to 20% of the region’s population is suffering from diabetes, particularly type 2 diabetes." Based on desk research and interviews with medical experts and technology providers conducted by the EIU, GCC Health 2.0: Tackling diabetes and obesity in an age of digital acceleration explores the role of technology in preventing and managing diabetes and obesity in the six GCC countries (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates), highlighting the potential impact on patients and the healthcare system.

I strongly agree with the findings of the report:
  • Technology is facilitating a shift in approach to tackling diabetes and obesity: from being reactive to proactive. Apps, wearables and virtual health systems allow patients and medical professionals to proactively monitor key health metrics, from weight to glucose levels, to take the steps necessary to prevent symptoms from worsening. New technologies are making testing more convenient and less invasive, which will help people better understand and manage their condition.
  • Apps and wearables on their own cannot solve health issues such as diabetes. A common perception among patients is that the more apps they use, the more weight they will lose, but technology can only play a supporting role. The onus lies on the patient to use these technologies consistently and to modify their behavior and dietary habits to deliver genuine results.
  • The new wave of technological innovations provides an opportunity for health authorities in the region to transform their healthcare system. Reducing the need for in-patient consultations through remote monitoring and self-management can alleviate existing pressures on healthcare capacity in the Gulf, particularly the shortage of physicians. Many apps and wearables that encourage healthier lifestyles can be effective in preventing diabetes and obesity, generating cost savings by avoiding the need for expensive medical procedures and treatment in the future.
  • Insurance providers must be encouraged to cover new technologies. Providing coverage of technologies that will prevent symptoms from worsening or, preferably, prevent the disease altogether, will reduce overall costs to insurers in the medium-to-long-term.
Diabetes and obesity is a problem worldwide, not just in the GCC. According to the World Health Organization's factsheet on obesity, worldwide obesity has more than doubled since 1980. In 2014, more than 1.9 billion adults, 18 years and older, were overweight. Of these over 600 million were obese. Furthermore, the Geneva, Switzerland-based organization notes that most of the world's population live in countries where overweight and obesity kills more people than underweight. 41 million children under the age of 5 were overweight or obese in 2014. Importantly, "Obesity is preventable."

On the topic of diabetes, the WHO says the number of people with diabetes has risen from 108 million in 1980 to 422 million in 2014" and the global prevalence of diabetes among adults over 18 years of age has risen from 4.7 percent in 1980 to 8.5 percent in 2014. Moreover, diabetes prevalence has been rising more rapidly in middle- and low-income countries and diabetes is a major cause of blindness, kidney failure, heart attacks, stroke and lower limb amputation. Sadly, the WHO projects that diabetes will be the 7th leading cause of death in 2030.

However, the WHO proclaims that a "healthy diet, regular physical activity, maintaining a normal body weight and avoiding tobacco use are ways to prevent or delay the onset of type 2 diabetes." Encouragingly, "diabetes can be treated and its consequences avoided or delayed with diet, physical activity, medication and regular screening and treatment for complications."

While "new technology, by itself, cannot prevent and treat diabetes and obesity," according to the EIU report, using technology can assist individuals to live a health lifestyle. "For health providers, technology can support designing and delivering more effective and efficient services." As Alan Russell, highmark distinguished professor and director Carnegie Mellon University's Disruptive Health Technology Institute said in an interview for the report: "'Diabetes and obesity are issues that cut across all of society. Medicine alone cannot solve the problem, nor can technology. Innovative technology needs to play a supporting role.' "

Do you agree with the findings of the report? What role does technology play in the prevention and management of diabetes and obesity?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.

February 1, 2017

How MBA Study Changes the Way I Think

The following is a guest post by Yan Tang

In January 2016, on my 27th birthday, I received a letter from Seattle University informing me I have been accepted to the Professional Master of Business Administration program at the Albers School of Business and Economics. When my celebration woke up the whole household, I knew I was not crazy. I was just trying to tell everybody, my birthday wish became true: I could go all the way to United States studying as an MBA student.

Time has gone too soon. After one year, I remain excited of living and studying in a different country. I could not help to think lately that in my MBA program, what I have changed after one year study?

So many things have changed: lifestyle, networking, expectations, etc. However, fundamentally, it is the change of the way I think that really makes a big difference in both my life and career pursuit. I call it independent thinking.

Our MBA students usually are assigned to do a lot reading before classes, and to write reflections or summaries based on the reading. Then students need to prepare ideas or thoughts for open discussions during classes. It is always amazing to hear the furious discussions or even debates between students or between professors and students. There are no right or wrong answers, as long as you have evidence your arguments; and everyone is encouraged to express opinions and raise questions. In this process, students learn to find relevant information to form our own opinions instead of depending upon others. In addition, the independent thinkers are able to go a step further to think critically or strategically.

I grew up with the China education system where students are used to being told how to complete tasks. Independent or creative thinking might not be appreciated. In another word, it is disrespectful to challenge teachers' authority. So students usually depend on solutions offered by teachers.

Back to the time as a junior student in college, I was appointed as a project coordinator in the Austrian Pavilion in Shanghai Expo 2010. Supervising around 60 staff who are much senior than me, I was in panic every day as I expected someone to tell me how to manage these employees in a right way. Even though I worked very hard to make sure everything went on smoothly, I did not think independently or strategically as a leader is supposed to do. I did not think about what was my expectations to myself and to the whole team, what was the goal we should achieve, and how was that job linked to my future career.

Things could have been done so much differently but I did not know that back to 2010. However, studying for an MBA makes me realize the importance of independent thinking to approach problems differently. If I were in that situation again, I would take advantage of it to act as an independent thinker to understand different backgrounds and perspectives bring different ideas and solutions.

Interestingly, many people make changes by inside or outside classroom learning.I am glad that I consciously have made this change through my MBA study, and I appreciate the value of thinking independently to generate your own thoughts and expressing your thoughts bravely. Especially if you are a team leader, being a hard worker is not enough. It is essential for you to be able to think independently and strategically.

Halfway through my MBA program, there are still so many things to learn and so many goals to achieve. Having developed the ability of independent thinking, I feel confident when facing complex situations in life as I know I will keep calm and find solutions for problems. It is the same when it comes to pursuing my career. I will no long expect to be told what job I should take, instead, I would think independently to analyze my strengthens when applying for positions and to seize the opportunities.

Yan Tang is enrolled in the Professional Master of Business Administration (Marketing) program at Seattle University. She also serves as a Business Relationship Management and Small Business Coach at Seattle University's Innovation and Entrepreneurship Center. Previously, Ms. Tang worked for Manpower in the company's Shanghai, China office where she served in several roles including Service Consultant, On-Site Project Manager for IBM Shanghai, and Recruitment Consultant. Ms. Tang may be contacted at yantang1126@gmail.com.