New York City
Put Aces in Their Places
New York is an odd little city. Well, I can’t really say little because it’s the largest city in the US, but something about the city makes it feel cozy the second you touch down. New York has recently bested Boston to take the Number 2 spot in the startup world, but what the heck does that mean for the social startup world? Well, from what I saw in the few days I was there, quite a bit. Only thing is, no one knows what social entrepreneurship is.
Oh there were definitely a bunch of ‘civic engineers’ and ‘coders’ and ‘brogrammers’ building companies that were helping people get food and access to government support, but no one, not even at the NASA Hackathon where everyone involved was looking to champion science education or green technologies, called themselves a social entrepreneur. And this is a trend worth touching on in the near future (in our Boston piece), especially for New York.
New York has also risen to its number 2 Startup-spot very quickly, in just a span of a few years. This is not to say their infrastructure was developed that quickly too; it already existed with the programmers from Wall Street, the big banks and the wealth management funds, not to mention the holdover tech companies from the 1990’s boom. Add this infrastructure to government support from Mayor Bloomberg and a wealth of other strong industries (fashion, for instance) and the capital from the first startup boom, and you’ve got yourself a startup community with a lot of fuel primed to explode.
I would be insane to forget the New York mentality when taking a look at how NYC has organized itself for social impact. The mentality I am talking about is the standard perception of a New Yorker as someone who solves their own problems, looks to make a fortune, and does it as fast a humanly possible. When you take that into account, it makes sense that no one thinks to be a social entrepreneur. To the New Yorkers I hung out with for 96 hours, there are problems, solutions, and a clock. If you can solve a problem and make money in the process, good for you. If you can do it before dinner, that’s even better. Some people took the hurried nature of the New Yorkers I met as rude. I think they just don’t understand. At least in the startup scene, it brings me joy to see someone pushing to get something done right away. Maybe it’s the validation process of making sure people want what you are selling. Maybe this means people are rushing through to get a minimum viable product out the door ASAP. No matter what, though, this mindset makes things at the earlier stages of the startup phase just go by so much more quickly (and they don’t skimp on the quality, either!).
With all of this combined, the biggest possible question is, ‘how do we focus the massive amounts of existing talent and power and speed on civic or social issues (transportation, housing, and low income jobs, for instance)?’ And that is what I want to highlight as a key takeaway from our time in NYC. NYC has been able to build a well-oiled machine that aligns a bunch of seemingly random groups in a way that creates real social impact (through technology). I cannot stress how hard that is to do. Seriously, way to go NYC.
This is how they did it.
A presentation by one of the many solutions built during the BigApps Hackathon, Blinkjobs.
Answer to Question 1:
Key Handoff: “Social startups? We don’t need no stinkin’ social startups!”
The good thing about New York not self-identifying as social entrepreneurs and instead solving big problems fast is that a lot of traditional views on social impact go out the high-rise window. The idea that charities need to be involved to administer the social impact is just strange there. Charities are definitely appreciated, but to think they are the only players on the team to upgrade the world is odd. Think of it like a 180 degree turn from DC.
Also, where most social movements or cause-based organizations tend to get bogged down in trying to solve complex issues alone or with a limited network because they only bring in groups who align with their specific causes, NY just ignores that entire thought process and brings in everyone. Government agencies sit next to private and public foundations, investors, and startups. I think this is because the question NY asks itself when it sees a problem is fundamentally different. A social venture often asks, ‘who in my cause can help’? New York asks, ‘who do I need to help’? And then New York builds the coalition from there. They don’t care what other people think about a specific agency or group; they don’t care what other people think about the cause of the space. They look at what needs to be done. They look at who can do it. Then they do it.
Take BigApps Hackathon or the NASA Hackathon for instance. At both you have over 100 people getting involved with addressing one of two key issues. BigApps had upward mobility for the unemployed and working poor. NASA had science education and upgrading learning to be cooler. With BigApps, you had a 3-4 month program that sourced the ny tech community to solve large social issues. New York, rightfully understanding that these coders probably didn’t quite have all of the required info on poverty or education policy or green energy in NY, got smart and now offers access to large foundations like the Blue Ridge Foundation through ‘problem packets’. A problem packet is a short document that chronicles the history of a social issue, the major factors involved with it, and descriptions on what kind of tool could solve the issue. These foundations make these fact packets available to coders at the beginning of a BigApps hackathon.
It doesn’t stop there. Bigapps afterwards has the foundations and other major impact groups in the space of upward mobility serve as advisors throughout the hackathon weekend, helping the coders tackle the social issues of the coding process like implementation, user interface, and branding so as to keep the people who will eventually use it engaged. Think of it like free market research. Lastly, the foundations put up grant money and open up their networks in partnership with the city so that the good projects, the ones that have a solid chance to succeed and grow as a standard for-profit business, can take off and start solving problems ASAP. Just stunning.
I can’t highlight how completely awesome this model is. You take advantage of all of NY’s strengths (speed, intellect, and self-help mentality) while addressing what could be its weaknesses (lack of long-term involvement by key actors, a desire for quick wins, very specific skill sets of those participating). You provide knowledge for the coders, labor for the foundations, and solutions for the government and people of the city. This is what collaboration can look like.
NY is even one of the few places I am ok with a rise in the largely tech-base for social enterprise, and with a very specific reason. With so many people living there and everything being so hectic, anything that creates order from chaos is just great. More so, the rise in social tech doesn’t come at a cost to standard social impact ventures. NY is leveraging the weekends of people in existing startups that just want to have a win for their city (more often than not). Over half of the participants I spoke to ended up participating only to pass the time, and let me tell you, when you have found a way to make solving social issues something people do to pass the time, you’ve won.
Hanging out with Mike and Alice, the Head Honchos for this year’s NASA Hackathon.
Answer to Question 2:
Key Handoff: Keeping people engaged means meeting them halfway.
New york doesn’t have the developer numbers of Silicon Valley. It doesn’t, and that’s fine. But New York has figured out how to leverage its developers for massive social good. Social entrepreneurs, schools, and foundations need to read this next sentence very carefully. You don’t need a long-time coder or long-time lawyer or anything long-term when it comes to building the initial solution. So long as you bring in the smart people in a deliberate way and you can make sure you get the outcomes you need, then everyone wins. From there you can bring on a group aimed specifically at growing the solution to scale.
I think this is the most important point of this piece for one reason. There are times in the social startup space where we want a lot from the people who volunteer to help. We want them to be involved long-term or not at all (or as simple, cheap labor). This even shows up as a kind of morality. Some people attack charities for paying their employees market rate salaries because these employees are supposed to suffer for the cause. They are supposed to work long hours for little pay, because the payoff is supposed to be a healthier society. Shouldn’t that good enough for them?
No. I think it’s foolish that everyone who wants to do social good is supposed to suffer. I think it’s misguided that many people who want to save the world fall for this lie. Caring people go into the social space to make a difference, and often find themselves tired and tried from empathy exhaustion. Empathy exhaustion is what it sounds like, where people become so tired from caring about others, working long hours and getting little pay, so that they breakdown. It’s becoming a badge of honor and it’s not right, because anyone without that badge is seen as ‘not serious’. There is an ethic that you have to be deep in the social space to really have value.
To people who think this, New York tells them to kiss its behind.
BigApps and other civic venture hackathons are smart. They understand that not everyone wants to be involved with a cause long term and that they might not see some of these hackers ever again. They know you don’t need to suffer to change the way things are done. They know you don’t need to give up on the things you need for the good life. They also know we shouldn’t ignore the time and talent provided by those who are willing to give it, even if it is only two days out of the year.
This isn’t to say there is no change in how to deal with these short-term world-savers. There is indeed one major change to the creation process. Hackathons, funders, and similar groups need to have a ‘save button’ on the progress for each step of the product development process.
Both the NASA Hackathon and the BigApps Hackathon encouraged developers that didn’t want to continue on with their projects to put their code online so that others could use it or to integrate it with the code of other participants. Think of it like building a Frankenstein monster that finds people jobs and isn’t afraid of fire. The wins for doing this were clear to the developers: if they build a solid piece of code that helps to solve a big issue, they get access to the powerful people and network that put on the event. This means more support and facetime with connected and influential groups that could take the developer’s full-time startup to the next level.
The handoff from all of this is that we need to meet people halfway in terms of making the world better. We shouldn’t set ridiculously high boundaries to get involved with any cause. In fact, we, and by we I mean the people who are more deeply connected and involved in the social impact space, should take the temperature of the people in our area, assess the skills they have, and build support systems that leverage those skills and people in a sustainable way. Because quite frankly, we have too much on our plates to not delegate these sorts of things. We are thought leaders, mentors, and mavens. We can organize groups to do amazing things, if we are intentional in the way we do it. It’s our role to build communities that make it easy for everyone to make the world a better place. Let’s just be sure we aren’t on too high a horse while we do it.
As a second example of this point, check out Enstitute. Enstitute brings on high capacity fellows from around the nation and puts them into long-term internships with startups. The reason I reference Enstitute after hitting on BigApps and NASA is that Enstitute knows first hand that a good many of its graduates might not end up going into startups. However, the win up front for Enstitute was that it would create a new generation of highly experienced problem solvers while at the same time empowering local startups to overcome their own hurdles. Enstitue’s success underscores my point. They are on path to break even and even generate revenue (as a non-profit) in less than two years, and it has done so because it meets the fellows coming through the program halfway.
A small selection of companies that helped the NASA Hackathon participants be cool.
Answer to Question 3:
Key Handoff: Make the money match the process.
This handoff links strongly to the answer we found for second question. Finance-wise, we see the deliberate and speedy nature of NYC again. The BigApps challenge, and even the NASA Hackathon, provided funding for the winners in the form of grants and continued mentor support. BigApps’ prize structure deserves special mention.
A one-time grant for a one-time event doesn’t quite satisfy the needs of the social startup space, the entrepreneurs, nor the entrepreneur’s cause, especially when you take into account the temporary involvement of many of the entrepeneurs involved with the events. Some challenges and hackathons have tried to offset this short-term involvement by the developers by asking event judges to take into account the relative level of involvement that they expect the ventures to have after the prize money is given out. The reason they do this is that many startup entrepreneurs get the prize money and then use it to fund another one of their other ventures. There are too many horror stories about business students or entrepreneurs that go around the business plan competition and hackathon circuit, make a lot of money making random ideas that could serve a great social good, and then use the money to pay off college debt or buy a car. Yes, they won fair and square, but winning the challenge isn’t the point. The point, for us, is to build something that transforms that way we live for the better.
This is one of the downsides of grants. You can’t really dictate where the money goes without being explicit up front or without holding the money is a special account or some other slow or frustrating process and on and on. It can be a bunch of work to give out a relatively small amount of money. But there is always a way! For BigApps, they have relatively small prize money in the short term (to give some fame to successful solutions) while also putting the larger prize for the full winners a few months into the future. Involved Foundations only give money to teams that show dedication across the long haul, and in doing so protect their finances from short-term world changers that arguably need the money less. These barriers up front make the process of actually giving the funds to the teams so much easier than giving them loans or taking equity before anyone needs to (and before the startup is ready for it).
No, we are not saying that grant making institutions and event prize providers should have the entrepreneurs jump through unnecessary hoops to prove how dedicated they are. That could go against our second point. What I’m saying is that people who hold hackathons should consider multiple events that offer greater prizes for greater involvement and stagger support in such a way that those who are really dedicated to solving the problem get what they need more often. Just look at AngelHack as a second example. Make the prizes do double duty by both incentivizing the coders for the long-term and then getting the good companies off the ground; your life will be easier.