Startups, Not Bailouts Create New Jobs? Wait, So the Emperor Has No Clothes?


This is part of my Series on Entrepreneurial Culture.

People in the start-up and investment community understand from first-hand experience that when it comes to job creation- start-ups are where it's at. It's also great to have organizations like the Kauffman Foundation, (that actually study, support and promote entrepreneurship), around to back this up with some hard stats. Below, for example, is the staggering reality about new job creation in this country:

“Between 1980 and 2005, virtually all net new jobs created in the U.S. were created by firms that were 5 years old or less...” (Kauffman Foundation)

But here's the problem: People who are not in the start-up, investment or tech scene, (read: the majority of the American electorate), through no fault of their own, do not for the most part realize this fact. This is probably because much of the mainstream press does not focus on or cover this reality.  I see very little emphasis on how critical talented entrepreneurs are to the growth of our economy and to job creation.

I was therefore amazed and delighted to finally see someone from the 'mainstream press' actually step-up on the big stage and bellow-out a big unqualified YAWP for the need for our government to focus on policies that support start-ups and entrepreneurs instead of hurling taxpayer billions at bailouts. G-d bless Thomas Friedman! How often do you see a NY Times columnist writing stuff like this:

"Good-paying jobs don’t come from bailouts. They come from start-ups. And where do start-ups come from? They come from smart, creative, inspired risk-takers. How do we get more of those? There are only two ways: grow more by improving our schools or import more by recruiting talented immigrants."

I couldn't agree with Tom more and I've covered some aspects about how I think we can improve entrepreneurial culture in our universities here and here.