In 2007, I met with approximately 150 entrepreneurs, worked more closely with about 30 (based on the quality of the idea but also the chemistry with the entrepreneur), and I have now narrowed my focus down to a handful that I am convinced are going to make it in 2009. The typical 1% selection rate that you also see with VCs or Angels, which inspired me to figure out something better to help entrepreneurs at large - an open model allowing peer support and transforming what is today a competitive process into a collaborative one.
In 2008, I started Entrepreneur Commons to do just that.
Entrepreneur Commons is the continuation of a similar concept that I started experimenting with in 2005 and that was implemented in San Francisco through a "Club Entrepreneur" with the Swiss American Chamber of Commerce and a "Business Booster" with the French American Chamber of Commerce.
The Entrepreneur Commons idea is very simple: on one side provide mentors to entrepreneurs to help them mature their business plan, and on the other side provide financing resources for those entrepreneurs whose business idea is mature enough. What is new with this is the combination of mentoring and financing in the specific context of entrepreneurs in developed countries. The model was inspired by the success of Microfinance and Mutual Guarantee Funds in Europe, which are proven sustainable models. As a result, Entrepreneur Commons is a not-for-profit for and by entrepreneurs including a platform hosting a social network of entrepreneurs and which manages a seed investment fund offering loans to startups.
The long term goal is to change the way startups are being financed, as the current model works for VCs but not really for entrepreneurs. And as a result, it is also to change the way we think about capitalism, going from individual trying to maximize their profit as the force that drives the system to fostering collaboration for a more sustainable capitalism.
To achieve this, the short term goal is to build a network of of 100 to 150 entrepreneurs on one side, and raise a fund of at least $3M on the other side, so that we can do 30 loans of $100K to entrepreneurs in the network. This will be the proof of concept that will demonstrate the model.
The idea was presented during the first few month after launch to many entrepreneurs, angels, VCs, Limited Partners, lawyers and bankers to discuss the idea and collect feedback, and has received mostly positive feedback: yes this is something that is needed, and yes the concept is good on the paper. The goal now is to make it happen, which is not a question of "if" but rather "when". The one lesson I have learned is that it will take time, and from my experience on past projects, I have only limited control on the timing :-)
So far:
- Entrepreneur Commons has a first chapter in San Francisco, with a handful of entrepreneurs meeting once a month to share their successes and discuss their business issues, and we have had interest from entrepreneurs in other states (Texas, Florida, New York, Germany, France, Israel) who are considering starting similar efforts.
- Entrepreneur Commons has already received soft commitments from investors interested in the concept.
- Entrepreneur Commons was invited to present at Socap08, as a platform that is especially useful to Social Entrepreneurs who are typically left out of the classic funding processes currently offered to entrepreneurs.
- The Entrepreneur Commons concept was submitted as part of the idea contest running on Change.org, and collected 339 votes to finish 7th out of 106 ideas submitted in the Social Entrepreneurship category.
As for 2009, I believe that this is going to be a great year of many opportunities. The financial crisis had the benefit of bringing a lot of people out of their comfort zone, and there is enough of a mess that people start questioning the status quo. This is a good start.
Then the presidential election in the US, with Obama getting elected by voters but also getting majority support from people from all origins in almost every country in the world has started a process that cannot be stopped. People have realized that the world needs to change, that nothing will happen unless they start doing something about it, and that Web2.0 technology gives us the power today to make it happen if we decide to. Obama has been riding that wave, and the wave is bigger than him as it is the rise of a peer to peer civilization. The coming years will see big shifts and therefore big opportunities for the people who are at the right place at the time. This is a game entrepreneurs like: 2009 will be their year.
Best wishes for 2009 :-)
