Entrepreneurs are America’s best resource for economic prosperity and growth. They have the ideas and the fire in the belly needed to create flourishing businesses that benefit entire communities.
These undaunted risk takers are the unquestionable source of wealth creation, new jobs and a strong nation. They provide the financial fuel to pay good wages and valuable benefits. They pay the majority of local, state and federal taxes. They contribute to their communities with donations to the needy, the arts, education and health care.
Successful entrepreneurs are the backbone and lifeblood of the U.S. economy.
To wit, over the last 30 years, business founders have paid wages to 40 million new employees and have given billions in taxes and donations. We are the beneficiaries of their magnanimity.
America has become an economic powerhouse as inventors over the last 235 years have made and sold boatloads of products and services to buyers both domestic and foreign.
Tinkerers with grand ideas have developed and commercialized automobiles, steel mills, railroads, aircraft, communications, television, financial institutions, computers and the Internet.
Surrounding these mega-industries has arisen an ecosystem of thousands of related vendors and suppliers, all prospering as consumer and commercial demand grew.
What about 2012 and beyond? When will the next great entrepreneurs appear? Where are they now? What bold ideas do they have? What’s the source of their terrific ideas?
From my experience as an entrepreneur and investor, I know new companies are poised to launch every day. There are dreamers who have ideas and are preparing to register their businesses when the sun rises tomorrow.
An unlimited supply of people living among us have discovered the next great product.
They are students, retirees, men and women who currently have jobs. There are homemakers who see a need and have a solution to the problem. All are anxious to take a leap of faith.
What’s the source of these bold ideas?
When I ask inventors, the answer is generally the same: “There came into my head a spark of light, a concept, an epiphany, an idea to solve a problem. It began when I saw a need, something that could be improved.”
Harvard professor Clayton Christensen summarizes this notion in his new book, “How Will You Measure Your Life?” He notes that people just naturally see that a job has to be done and move forward to complete it.
He notes that inventors often pursue a solution in a calculated manner, but as they do so, they often recognize by serendipity an opportunity that is the best of all worlds.
He gives the following example:
More than 40 years ago, Honda decided to compete in the U.S. motorcycle market, which at the time was dominated by Harley-Davidson. Honda management believed it could gain a share of this market by making the same kind of vehicle for a lower price.
After a few years, Honda had sold just a few bikes to an unimpressed ridership. The Honda machine was perceived by the public as a poor man’s motorcycle that leaked oil and had to be shipped back to Japan for repairs.
Just before Honda pulled the plug on a major business fiasco, serendipity enlightened a downtrodden management team.
Honda had also shipped a few of its smaller motorcycle, the Super Cub, to the U.S., but no one really expected Americans to buy them because enthusiasts valued the big and powerful road bikes.
These smaller motorcycles had been designed for the delivery of packages to tiny Japanese stores on narrow streets crowded with people and carts.
One Saturday, a member of the Honda team, living in Los Angeles, took his Super Cub on a joy ride through the peaks and valleys of the hills in west L.A.
His response to the ride: “I have never had so much fun in my life.”
The next weekend, he invited his peers to join him, zipping up and down the countryside on their Cubs.
In short order, others heard about what had become known as the dirt bike and asked where they could buy one. It wasn’t long before Sears asked if it could sell the Super Cub through its print catalog.
Eventually, Honda’s management team saw the light and dropped the Harley-type bike tailored for classic customers in favor of motorcycles for off-road use, a concept aimed at an entirely new audience.
Such innovation can happen incredibly fast, creating new opportunities and new markets for entrepreneurs, customers, employees and communities.
In sum, America will continue to need intelligent and energetic entrepreneurs with brilliant ideas. Our economy will falter without them.
Utah and the world should look to the next generation of business titans and their dreams of utopia.
Our hope is to celebrate, at some future date, the award-winning successes of future builders, those who will have an impact similar to that of historic figures David Eccles and John Browning.
Alan E. Hall is a co-founding managing director of Mercato Partners, a regionally focused growth capital investment firm. He founded Grow Utah Ventures, is the founder of MarketStar Corp., and is chairman of the Utah Technology Council. His column appears every Wednesday in the Standard-Examiner.