Inside the often pale and cold-blooded architecture of business, desires to do good typically take a back seat to meeting the bottom line. More prized traits seem to be a raw pragmatism, a squinting attention to detail and a mind for numerical advantages.
That’s why it may strike people as peculiar to know a growing number of civic tech startups are happily speaking up against the trend. On Wednesday, entrepreneurs from three of these startups, which have adopted community problem solving into their business models, gathered via webinar to share success secrets and proselyte the business virtues of urban samaritanism.
The speakers were taken from Tumml, an urban accelerator that mentors and seed-funds civic startups. They included Julie Lein, Tumml’s co-founder; Rose Broome, the founder and CEO of HandUp, an online crowd funding platform for the homeless; and Snir Kodesh, co-founder of Corral, a multi-pickup ride sharing service — both of the companies are part of Tumml’s accelerator program.
The hour-long discussion, dubbed Startups & the City and hosted by the urban tech supporter Meeting of the Minds, took the speakers back to their company’s roots as they fielded questions, delved into entrepreneurial mechanics and hypothesized about their paths ahead. Here is a small extraction of what developed by way of four tips that foster civic startup success.
1. There is No 'I' in Success
In 2012, Lein, along with her fellow co-founder Clara Brenner, were sifting through ideas for how to best help a rising tide of civic entrepreneurs. Searching for more than mere anecdotes, the two took to their phones and email accounts to survey 106 early stage entrepreneurs with the mission of spotlighting impediments to civic tech growth. When results were tallied, Lein said two dominant gaps emerged. The first being a lack of startup capital (due to the industry’s unfamiliar track record) and the second being an unmet need for collaboration from city officials. The big takeaway, she said, was that civic tech success requires joined arms to secure both funding and to cut red tape in ways of urban permitting and licensing.
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“Our specific mission is to empower entrepreneurs to solve urban problems, and so basically we provide an education program, a mentorship program and a general support group for urban impact entrepreneurs,” Lein said, speaking of the Tumml accelerator, a program that offers $20,000 in seed funding in addition to the mentorship program.
2. Cashflows Create Longevity
Generating profits is, of course, a practice that any business, civic minded or otherwise, should unapologetically embrace. It’s a concept even Broome has employed at HandUp to makes sure the company is sustainable over the long haul and that the homeless served continue to receive support.
Broome explained that 100 percent of the donations go to the homeless directly through nonprofits that manage funding distribution. However, an additional (and voluntary) $5 support tip is requested from donators to help with costs such as credit card processing fees and operational expenses. According to Broome, while they're still considering additional revenue models, these tips are the primary thing keeping HandUp afloat.
“What we do is let our donators opt in a support fee, and currently 80 percent of HandUp donors are opting to offer that $5 support fee.” Broome said.
3. It Should be Expandable
The potential and drive for expansion, growth from city to city, is a cornerstone to enter Tumml’s accelerator program. Lein said the trait is used to weed out the many applications that come across their desks for review. The reasoning behind it, she said, is that the ability to expand into new geographic areas and markets shows that a business has the qualifications to be a major public benefit, while simultaneously showing itself as a secure investment.
“Our intention really is to support and help entrepreneurs start their startups in any city around the country,” she said. “And ultimately, the sign of success for us of any startup is their ability to scale from one city to another.”
4. Dot your I's and cross your T's
Corral, the service hoping to be an on-demand ride pool for city-goers, stood out as an example of a company that, like many successful civic tech startups, is doing a double check to ensure they’re aligned with proper regulations. The company is among the ranks of transportation network companies such as Lyft, Uber and SideCar with the difference being that Corral aims to provide multi-person transport with a fleet of paid company drivers (essentially an on-demand busing service with sedans). The industry is in a state of flux as regulators catch up with the ride sharing concept and implement rules and guidelines. Kodesh said he and his co-founder Noam Szpiro are working to make sure they comply with California regulations such as insurance mandates and new safety requirements recently set by the California Public Utility Commission.
“The only thing left for us is getting the insurance in place and we’re obviously very serious about it for our drivers out on the road,” Kodesh said. “We’re kind of in a prelaunch phase.”