Themes from Exploring Austin’s Entrepreneurial Ecosystem
Austin has one of the most vibrant tech industries in the country, but there’s more to the city than start-ups and Big Tech. Austin is invested in diversifying its industry, as outlined in its current five-year strategy plan, Strategic Direction 2023. For our research, we decided to explore how the City of Austin is fostering its non-tech entrepreneurs, who often do not have access to venture capital or angel investors looking to fund the Next Big Thing. We spoke specifically with women and people of color to learn how they are being supported by the city and its network of partner organizations that help people start their own businesses. Diversity and equity is important to us, and it is something that we hope to see reflected in our city’s economic sphere.
We spoke with nine small business counselors who work at three organizations: the City of Austin, SCORE and PeopleFund. PeopleFund is contracted by the city to provide small business loans as well as business assistance and education to people with otherwise limited access to such resources. SCORE is funded by the Small Business Administration and is America’s top resource for free business mentoring and education. The City of Austin partners with these and other organizations to provide guidance, counseling, and financial support to its budding entrepreneurs.
In addition to counselors, we spoke with five entrepreneurs working in various fields, including Jonas, who is starting an IT support franchise; Agnes, who wants to help people cook healthy meals; and Claudia, who is starting a mindfulness training business. Perhaps due to the nature of our research lens, all of our interviewees spoke of the desire to give back to their communities and be able to give more of themselves to their work. Beyond that, their interests were quite different, but key themes emerged in our interviews that illustrate similar emotions and experiences. We delve into some of them below.
Theme 1: People feel stigmatized for making “unsafe” choices, creating feelings of insecurity
We heard this from many of our interviewees who shared stories of shock from family and friends about their entrepreneurial decisions. “People were like, You’re doing what? Why?“ Claudia recalls. That requires guts, Jonas’s neighbor told him. Starting a business is often seen as an “unsafe” and potentially unwise move, that leads entrepreneurs to feel insecure when talking about it. This exacerbates the difficulties of networking, which is already a difficult thing to do. Agnes explained how nervous she gets talking to large groups. She likes to bring small groups of people together to cook so that she can avoid the discomfort of traditional networking. “The cooking is like a guise, because you’re not focused on networking,” she explained.
Theme 2: Entrepreneurs rationalize uncertainty by clinging to “silver bullet” ideas
We saw this repeatedly in the way that people talked about their businesses. “Client acquisition is the biggest thing…just getting new customers, getting your first couple of customers,” Jonas told us, as if getting just one or two customers was all he needed. Claudia felt that it was just a matter of “getting in front of the right people.” This idea that others would come in and ensure their success—a silver bullet—was a common trend.
Theme 3: Entrepreneurs worry they will fail by not making the most of their time and opportunities
Claudia shared her fears with us when relaying a story about trying to keep up with her networking goals. She’s working with an incubator here in town that recommends she talk to 100 people per week about her business. “So up to this point, I think I’ve only talked to 15…but when you are in that moment, it may be that one person that you need to say it to,” she says, lamenting her shortcomings. Entrepreneurs often feel like they are coming up short of where they need to be.
This can be compounded by advice that stresses the importance of action: as Gary at the City of Austin explained, “A lot of people get trapped in the analysis paralysis. They’re overthinking things when they could have already started something already.” This urgency can exacerbate entrepreneurs’ existing stress.
Theme 4: Counselors feel that they need tangible metrics to measure success
We found that counselors use all sorts of metrics to monitor Austin’s entrepreneurial activity: workshop attendance, businesses started, jobs created, loans made. But some crucial components of success—such as confidence—can be difficult to track. Gary told us about the Women’s Entrepreneur Lunch, an event that the city hosts specifically for female entrepreneurs. Although he admitted there was value in bringing women together, he found that it was difficult to gauge its impact. “There’s probably, certainly a lot of intangibles,” he said. “Was I inspired? Did I gain confidence? Did I increase my network? We don’t have the measuring stick in place to capture all of that.” And yet, so many entrepreneurs looked to networking as the most important factor in their success!
Theme 5: Resources are viewed as an acceptable substitute for learning
If there’s one thing that every counselor has, it’s resources. Resources can be good, but not when every organization you speak to gives you giant stacks of them. The resources were overwhelming just to look at.
“There have been some organizations trying to pursue the ‘holy grail’ of the start-up list,” Gary explained in our one-on-one session. “And I get asked the question, Well, where’s my checklist? And I haven’t been able to figure it out, because I don’t think it’s a linear process. Maybe somebody can, but this is my attempt at some sort of process.” He then shared the following document with us:
Entrepreneurs see these resources as substitutes for actually learning the skills they need to succeed. At one workshop, a woman asked if she could just pay someone $400 to write her business plan, and Jonas spoke of purchasing networking lists from another organization.
Too many resources can lead to overwhelm, and they don’t always say the same thing. As Claudia put it: “I’m hearing a lot of contradicting information. I guess it’s whatever resonates with you.” In the end, some entrepreneurs fall back on their instincts because there are so many tools and methods, but no clear way to succeed.
As we continue to work with entrepreneurs and the service organizations that support them, we hope to use these themes to identify ways that we can make the entrepreneurial process smoother. In this way, we hope to ultimately help people find their footing when navigating the city’s entrepreneurial ecosystem.