By INGRID VANDERVELDT
Dell’s Entrepreneur in Residence
Special Contribution to Silicon Hills News
We’re seeing more entrepreneurial activity in the U.S. than ever before – a result of factors including low cost of entry for startups, increased availability of funding for early-stage startups, and valuations for successful startups hitting an all-time high. With the New Year upon us, it’s the time we all start thinking about how this year will be different than last and what trends will have the largest impact on the entrepreneurial community in 2014. Some of my top predictions are as follows:
1. Social media space continues to grow ever-crowded. While not a new trend, social media has fully matured as a channel, with 73 percent of adults in the U.S. using at least one platform and 42 percent using multiple social networking sites. Every company needs a comprehensive, customer-driven marketing and communications strategy, and in 2014, that means knowing where your customers are and finding ways to have meaningful and personalized interactions. Over the last year, Pinterest became wildly popular among women and surpassed Twitter in total users, while new applications such as Snapchat stole attention from Facebook among the teen market.
Although the decline in Facebook usage among teens may be over-hyped, the truth is that all users, teens and adults alike, are using multiple platforms to suit their needs – LinkedIn for professional networking, Pinterest for social bookmarking, Instagram for photo-sharing, etc. With so many platforms, it’s important to have a strategy that doesn’t put all your eggs in one basket. Pay attention to demographics and make sure you are where your customers are. Entrepreneurs should also look to leverage their own personal and professional social networking activities to build their brand while integrating social across their enterprise. Also, consider taking a page out of Dell’s book by leveraging the passion, talent and networks of your employees by starting an employee advocacy program.
2. Marrying profits with purpose. Launching and maintaining a successful business is no longer just about the bottom line. We’re seeing more and more companies building sustainability and a vision beyond profits into their cultures from day one, and attracting customers and top talent in the process. Tesla may be a car company but its vision is to “expedite the move from a mine-and-burn hydrocarbon economy towards a solar electric economy.” Warby Parker may sell fashionable eyewear, but the B Corp aspires to “do good in the world” for its “employees, customers, community and the environment.”
I joined Dell because I believe in its vision of technology powering human potential. Supporting entrepreneurs and empowering women in business are key tenets to who Dell is as a company. Just one example of this is the Pay it Forward initiative Dell launched last year, setting a goal to track support for one million women entrepreneurs by the end of 2015.
3. It’s no longer a question of Silicon Valley or Silicon Alley. While the Valley is still seen as the epicenter of the startup universe by many, opportunity is becoming more geographically dispersed than ever before. Cities including Austin, Tennessee, Denver, New Orleans, and Detroit are all cultivating their own startup ecosystems and the number of startups founded outside of traditional entrepreneurship hubs is growing significantly. This trend is being supported by large national initiatives such as Google’s Tech Hubs and the White House’s Startup America Partnership, along with local efforts by cities across the U.S.
For entrepreneurs, the hunt for financing and top talent may make the Bay Area appear attractive but think twice before jumping on flight and heading straight to Sand Hill Road. Not only are there benefits to being a big fish in a small pond, but the competitive advantage of regional economies should also be a factor in your decision-making process. Silicon Valley may still be the right place for you if you’re in enterprise technology, as might New York City if you’re launching a media-focused startup, but know your industry and do your research as new hotbeds of innovation are emerging worldwide, and it may be easier to break through the clutter and get noticed in a less saturated market.
4. Alternative forms of payment and digital currency move into the mainstream. PayPal launched in 1999 as the first mainstream online money transfer service, creating new opportunities for merchants and entrepreneurs on the web. 10 years later, Square’s card reader made it exceptionally easy for just about anyone to accept physical credit cards at their point of sale. In 2013, a formerly obscure cryptocurrency, Bitcoin, took to the mainstream evolving into a multi-billion dollar ecosystem recognized by hedge funds and Congress. With Bitcoin BitPay processing over $100,000,000 in transactions, Bitcoins were used to purchase spots on Virgin Galactic flights to space, Lamborghinis, and OKCupid credits.
These alternate forms of payment are offering businesses a compelling way to expand their customer base, reduce per transaction costs and improve user experience. With the pace of innovation in financial transactions increasing and the desire for frictionless transactions on the rise, startups, especially those involved in e-commerce, will need to familiarize themselves with alternative currencies and payment methods. While accepting mobile payments or embracing digital currency may not be the right fit for your business, 2014 might be the right time to figure out your policy and ensure you’re taking the appropriate security measures if you do decide to try out new technology.
5. It’s time to think twice before you IPO. The nimbleness and passion that got your startup where it is today can be difficult to sustain under the watchful eyes of shareholders. Going public has been shown to zap innovation and foster short-term thinking by measuring success in quarterly earnings rather than taking the long-view.
If there’s a lesson to be learned from Michael Dell’s battle to bring Dell private in 2013, it’s that stockholders require an intense focus on short-term gains, which can sometimes be counterproductive to the long-term viability of a company. Entrepreneurs thinking about going public should take note. Will fewer companies go public in 2014 than in previous years? Probably not, but they should definitely weigh the pros and cons more carefully.
6. Women are rising to the top. Not a new trend, but, in 2014, I believe the rate at which women are taking leadership positions and “owning their potential” is going to grow at rates we can’t even fathom. For example, just yesterday it was announced that the first female law firm just opened in Saudi Arabia – something that would’ve been unheard of just 12 months ago!
With public/private partnerships such as Dell’s work with the UN Foundation, we are now in a position to create change for women on a global scale and this year we’ll continue to see increased collaboration between governments, international organizations, the private sector, and individual stakeholders to positively impact female entrepreneurship worldwide.
Ingrid Vanderveldt is an entrepreneur, investor and media personality connecting entrepreneurs to corporations. Ingrid is leveraging her business, policy and media initiatives to “Empower a Billion Women by 2020” to help provide women with tools, technology & resources. As Dell’s first Entrepreneur in Residence (EIR), Ingrid serves as the bridge from the “outside, in” connecting the entrepreneur community to the expansive resources the Fortune 50 company. Ingrid created and oversees the $100M Dell Innovators Credit Fund and The Dell Center for Entrepreneurs. In 2012, Ingrid helped architect The Federal EIR Bill with Senator Mary Landreau (LA) and Representative Mike Honda (CA), and is currently working on legislation with State Senators to bring out a State-wide EIR bill in 2013. She is also the co-founder of The Billionaire Girls Club, is a Dell Women’s Entrepreneur Network Member and serves on the UN Foundation Global Entrepreneurs Council.