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Are entrepreneurs the answer to global sustainability efforts?

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According to this article from Reid Hoffman, the UN thinks the world should create 600 million jobs over the next 10 years. Since entrepreneurs create companies that produce more jobs, they are looking towards us to be the main force driving success behind this giant task. This kind of growth undoubtedly requires tons of micro-entrepreneurs and high-impact folks to create companies that are scalable and fast-growing. Is this kind of growth possible within the (hopeful) 10 year time limit? Reid Hoffman doesn't seem to think so. But I'm starting to think that if it's the slightest bit possible - entrepreneurs will be the ones to make it happen. Interested in what others have to say.


10 Replies

John Seiffer
1
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John Seiffer Advisor
Business Advisor to growing companies
That article didn't seem to say much of substance.

I think this is a matter of definition. In one way of thinking, anyone who works for a company has a job created by an entrepreneur because that company was once a startup with a few co-founders at the helm. So by that standard, of course entrepreneurs will make it happen.

I've worked with economic development folks before and what they can do that makes a lasting effect depends so much on the situation and when they measure the results. If someone gets a solar panel and a cell phone in the middle of a developing country they can sell phone minutes and perhaps make more than they did farming. Does that count? If they hire an assistant?

But in the developing world, the number of startups that fail in a few years is huge. I don't know if anyone has measured them in terms of "jobs lost" but shouldn't that be taken into account?

One of the "poster child" startups where I used to live when public 10 years after being founded. They had 400 employees. A great success story. But when you think of it, that was 40 jobs per year. I routinely consult with companies that can grow by 4 or 5 or 6 people a year. Ten of those and you've got the same 40 plus jobs.

That's more like "economic gardening" than startups. Probably creates more jobs but isn't as sexy.
Harold Wood
0
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Harold Wood Entrepreneur
Software Engineer at Microsoft thru H10

I think this can be done by focusing on expansion using a decentralized (franchise) model rather than the usual centralized model. This means that the central office will have to give up a percentage of the profit since it will now be split among all the franchise offices.

In manufacturing this means pulling away from an automated(robot-driven) product construction modelto a more human driven model. This creates jobs, stirs the local economies, enhances the local tax bases, and actually should enlarge the potential pool of sales targets for most moderate prices products.

So entrepreneurs that are hardware focused can do this, I don't think that software focused entrepreneurs, while still valuable, will have the same amount of impact on future employment.


John Richards
1
2
John Richards Advisor
Entrepreneur | Investor | Consultant | Professor
Since the Great Recession (2007-2009), there has been no job creation. Chart evidence.

And it's only going to get worse. A must-see video is "Humans Need Not Apply" -- robotics is coming for everyone's jobs, even software engineers' heralded jobs.

The number of employees at leading tech firms is super low. I have heard that Apple, Amazon, Microsoft, Facebook, and Google combined has only about 150,000 FTEs (they use a lot of contract labor). A generation ago a group of five such powerful companies may have had 3+ million FTEs. Here is some evidence of second-tier companies having a huge impact on society and employing so few.

Entrepreneurs may create new companies with new jobs, BUT they are now not ramping up and needing lots of jobs. Google opens a 250,000 sf data facility and the locals get excited for job creation until they realize that there will be 4 people manning the entire facility. That may be an exaggeration, but you get the point.

And now we are facing a really interesting problem. In the last 12 months, the manufacturing (such as "Internet of Things" device creators) is coming back to the U.S. from SE Asia because it is becoming super automated. The 400+ million people in China lifted out of abject poverty in the last 20 years now enjoy a middle class lifestyle, but will it be maintained? If a project is 35+ percent labor, then SE Asia or Mexico gets the work. If it's less, the work is coming back to the U.S. -- but not creating jobs because robots are doing it.

The key for entrepreneurs is to become owner of robots and robotic processes instead of "working for the man" and eventually becoming a displaced worker. There will be a separation of "wheat and tares" economically, I fear. Some of the smartest people I know have asked, "What will we do with all the people?" and no one seems to know the answer.

John Seiffer
0
0
John Seiffer Advisor
Business Advisor to growing companies
If it's true that the tech revolution eliminates most jobs - and it might - then one solution could be UBI - Universal Basic Income. Pay people enough to live on just for being citizens. This guy has a lot to say about it.http://www.scottsantens.com/ the arguments sound pretty good to me.

On the other hand, when the industrial revolution eliminated a lot of farm jobs in the early 1900's no one could have predicted the rise of the entertainment industry and the number of jobs it created. So perhaps the robot revolution will lead to something unexpected.
Stephen Cataldo
0
0
Stephen Cataldo Advisor
Drupal | Startups | Green Conferences | Carpooling | Strategic Planning During Conflict
I think the word "entrepreneur" is overused: a massage therapist with a marketing campaign, or someone who is seeking $1m in investor money to hire other people to build something intended to scale, are using the same word.

Most of the sustainable, real-need, good-job-creating business ideas that I encounter are smaller. They don't scale. The last generation or two has seen a disappearance of neighborhood-scale entrepreneurs/business-people, replaced by chains. I'd love to see a resurgence of bootstrapping, lifestyle-businesses, I think they would help a lot of people find employment who are left out of the mainstream. But I don't think the investment-chasing Silicon-Valley startups I've worked with were or would have been significant job creators.

...

For example, AirBnB was one of the few examples in the article, and that must let us meet our need for hotel rooms with less, not more, jobs. Wealthy nations just don't need more stuff, don't have much to work harder for, and keep getting better at replacing well-paid jobs with low-skill jobs.

[ Various people labeled "Luddites" turned out to be wrong when they thought automation and technology would cause mass-unemployment, but only 95% wrong ... the "natural rate of unemployment" creeps up generation after generation, the faster tech moves the more people's lives seem to be disrupted. All the economic theories we use are about scarcity -- too little capital, too little labor, producing too few goods to meet real needs and wants. All three of those have gotten fuzzy. Known wants and needs are met by old companies. The main job of an entrepreneur today is to find a want we didn't know we had, traction to prove that people actually want it. ]
Harold Wood
0
0
Harold Wood Entrepreneur
Software Engineer at Microsoft thru H10
Again, robotics is cost effective in a centralized manufacturing model, it doesn't work as well when you look at a decentralized manufacturing model.
Axel Schultze
3
0
Axel Schultze Entrepreneur
Founder Society3 Accelerator & Fundraising market place
Sadie, I wholeheartedly believe so.
Sorry for the lengthy answer:
* Around 3000 B.C. Egyptian pharaohs began to build harbors, cities and stimulated organized trade - even though with the idea of better controlling taxes but eventually quadrupled business. The incremental value that was created provided Egypt with a level of prosperity that was unimaginable before. AND it was the first time that incremental wealth was created without steeling it from others. It became the role model for other societies around the world for the following 5,000 years.
http://www.ancient.eu/egypt/

* In the mid 1700's A.D. the industrial revolution fundamentally changed the face of society again. This time not a single country leader but hundreds of "Value Creators" even within a city was building products and services at an unparalleled rate and created a level of prosperity for those industrialized nations that was again unimaginable before.
https://en.wikipedia.org/wiki/Industrial_Revolution

* Today only 300 years later, we are at the verge of yet another fundamental shift. We will see not only a small group of elite members of a society but millions of individual entrepreneurs around the world create incremental value, building most likely much smaller enterprises - on average 500 employees rather than 50,000 but have a significantly higher impact on our global prosperity than even before imaginable - again.
in the next 10 years 1 Million entrepreneurs who create industry grade products and services can create 2.5 Billion new jobs - we are all part of Society3

We started a special initiative in the country with the longest history of industrial entrepreneurship, Germany: http://innovationRingGermany.com. It's a non profit organization with the help of universities, chambers of commerce, established industry leaders, startups, politicians, leading political parties... We just started this week - our objective it to create millions of new jobs and incremental value - instead of increasing regional prosperity through war.


Ken Queen
0
0
Ken Queen Entrepreneur
Income For Baby Boomers
I'm sure you know who the ultimate answer lies with but from man's point of view certainly entrepreneurs are the answer to jobs not government. Governments and laws where instituted to help protect one from another not to create jobs.
As far as how fast jobs will be created, a man's efforts will help determine the outcome but again date setting might be a nice goal but it's still a shot in the dark, there are factors that we don't know in advance that could speed up or slow one down. You have to put your best effort out and what comes comes.
Douglas Karr
2
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Douglas Karr Entrepreneur
CEO, DK New Media and CMO, CircuPress
Our education system is woefully lacking when it comes to starting a business or being an entrepreneur. My kids understood balance sheets and accounting, but never learned how to get incorporated, what cashflow is, how a credit rating worked, what venture capital, small business loans, small business loans, grants, or anything else was/is.

What I see continuing to grow in popularity are co-working environments where entrepreneurs are collectively educating and informing young people... but they're already out of college and typically looking for employment just like everyone else.

The entire premise of our primary and secondary education was to provide well-rounded employees that could fill our factories. Now we don't have factories. Until we recognize the value of entrepreneurship and quit bad-mouthing corporations, I don't think we stand a chance.
John Richards
0
0
John Richards Advisor
Entrepreneur | Investor | Consultant | Professor
@DougalsKarr: I think you are right on. That is precisely why we are disrupting education with bootcamps. I just launched StartupIgnition.com. What do you think?
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