Creating a new generation of technology entrepreneurs Part 2: Consumption vs. Creation

November 24, 2009

Last week was Global Entrepreneurship Week across the globe. You can read all about it here. But I’m sure you all knew that already because you’ve seen the bus loads of inner city kids being taking to events to help them understand what entrepreneurship is all about or you have had to sign permission slips for them to participate in workshops to show them how easily they can create tech start-ups. (I really wish that were the case)

A few months ago I was at a conference and someone was talking about how African Americans are the biggest consumers of mobile technology and content. They talked about how Diddy was a presenter at the last wireless conference and how minorities are buying and utilizing mobile services at a rapid pace. I started to think about how even though this may be great for the mobile industry and may even provide value for us as consumers, it sends the wrong message. We all like to have the newest, hottest gadgets but not enough of us look at these new items as business opportunities. We play video games and never think about what it takes to create them. We use Facebook and Twitter and never think about the how we can create businesses with them, satisfying the creators of these products but missing out on the opportunities that are right in front of us. I’m not sure if I’m more frustrated with that or with the fact that the rest of the world assumes that is how it’s supposed to be.

I believe the mobile space has some of the best examples of this and here is one you are probably already familiar with. When Apple announced that they had achieved the 1 billionth download of an app from the app store for iPhone and iPod Touch. Since that number was reached at such a rapid pace it was worth taking a look at this market I decided to explore what the barrier of entry was for creating an iPhone app.

1. First I would need to learn how to build one. I went to the library and found 3 books on iPhone development that I could take out (for free). Next I went to the Internet and found out that there is class that Stanford offers on iPhone development that you can watch on iTunes (for free.) You can get it here . You can actually see all the schools that have classes on iTunes for that matter here .

2. Once I had all this information then I found out the tool which Apple offers to create the apps which is called Xcode is offered (for free) here.

3. Once I go through and create and app I can get it uploaded to the app store by joining the developer program here for about $99 .

Now this is a high level walk through of what it would take to get going but compare it what it would take to open a restaurant, or a Laundromat or any physical business. I mentioned for free a lot in those points to highlight that money is not a barrier here. Also take into account that there are many businesses on the iPhone app store that started out with just one person and now are making 6 figures in sales. The larger point I wanted to send home is that many of the people we know would not even think about this as a possibility let alone go through the steps. That is what has to change. If you have children of your own or know that you can affect, encourage them to wonder how things work, who builds them and can they make a living doing it. Help to develop the problem solving mindset that is in all of them. The holidays are coming so I know young people are asking for the Wii, Xbox, Playstations and phones like the iPhone. Take a few mins. to get them to take a look on the Internet or go to the library to see what it takes to create the content they are consuming. The bottom line is that adoption and consumption of these technology mediums is great but if we as minorities don’t get involved in the creation process then how can we ever have any level of control?

Category: Entrepreneur, Featured | Tags: Entrepreneurship, Urban Youth, youth

navarrowwright

Ok Wm_tucker
It's obvious that you just want to debate me, which is all good. First, All my posts in regards to being an entrepreneur are focused on creating web or technology based business ( mostly web) so I'm not sure what you meant by your first point. My whole point for writing these posts is to encourage people to try their hand at being entrepreneur and to understand that the barriers are lower than they may think. The kind of "man it's just not realistic for us" mindset your showing is one of the reasons why we don't have more African American technology entrepreneurs today. There are numerous businesses out here today that have been created and are thriving by using the "bootstrapping" principle of taking no or limited outside funds. There are numerous scenarios in a companies life cycle where accessing outside capitol makes sense. The point of these posts is to point out that lacking capitol in the beginning is not a game ending obstacle. IF you are going to preach that getting capitol is the end all to be then you need to explain all sides of that path. For example let people know that the earlier in the process you take outside funding, more than likely you are giving away a larger piece of their company and in some cases company control to do so. Explain company valuation and everything that goes into it. If you have raised money from the venture community and gone through that process then should know those insights are key.Otherwise your just giving misdirection and i think there is enough of that in out culture today. My goal in stating my "Challenge" was to allow the readers to see examples through our dialogue that could illustrate a possible direction to them. But instead of that you issue a challenge to me in efforts to i guess " call me out" that's just silly and unproductive but again I'll bite. I'm in the process of creating two separate ventures by bootstrapping 1) because i wanted to illustrate the process through future posts 2)Because i believe the ideas have some legs. I've also raise significant funds from some of top firms in the country but honestly it's not really about what I've done. It's about me wanting more Black people to do and do it better to me. I know there are people out there who can if they are encouraged to take the first step.

Wm_Tucker

No, bruh… this isn’t about you; this isn’t personal. I’m not ‘calling you out’. We’re not debating as much as we’re discussing how best to get from point ‘A’ to point ‘B’, so to speak. I’d like to believe we both want to see more Af-Ams become tech entrepreneurs -- which I interpreted from your first post to be a person who either starts or presides over a company involved with technology, e.g.; manufacturing or scientific research. As I wrote in my last entry, bloggers and e-tailers don’t really fit this description. While I also believe you’ve conflated technical knowledge with the skills necessary to start/run such an enterprise, I understand and agree with the larger goal of expanding the numbers of Af-Am leaders of software & hardware manufacturers, ‘green’ energy manufacturers, biotech R&D firms, etc..

With that said, any discussion on Af-Am headed firms producing smartphone apps, netbooks, biofuels, etc., has to be centered on how the economy writ large works in that practical methodologies for its navigation can be created. Originally, you characterized capital and credit as non-issues for starting a business today. Nothing could be further from the truth. In actuality, poor access to capital and credit not only remains the #1 obstacle facing aspiring entrepreneurs, it’s the #1 reason why >75% of all businesses fail inside of 3 years -- facts that can be corroborated by any reliable source on business or economics.

You now write of ‘bootstrapping’ -- using one’s own resources to start/run a business -- as if it doesn’t require one to have boots up front in order to bootstrap. I’m sure you know most Americans, particularly Af-Ams, typically lack the individual wherewithal to start an enterprise of the type you allude to in your essay. For example, a smartphone app can cost $10k - $150k to develop. Presuming our hypothetical tech entrepreneur decides to finance his project with a SBA loan, they’re can realistically expect the lender to require $2K - $30K in cash or equity before approving the loan. Contrary to your opinion, bootstrapping is the avenue of last resort. And while it’s noble (in concept), it’s an inefficient use of the entrepreneur’s resources. That’s a lesson taught in both Business 101 and the School of Hard Knocks.

Ron

Simply put, we need schools that teach this stuff from a very early age. Not just focused on development, but an entire broad approach on how we approach subjects. Most of the things I learned in elementary school -- like writing research papers, how to read the stock market pages, public speaking -- were the foundation of skills that served me throughout my academic career and life. But it has to start early and there has to be a commitment from people across the board to make this happen. It takes money, it takes will and unfortunately there are too many barriers to entry that crop up these days to make this sort of thing work as well as they did even a generation ago.

It doesn't mean we shouldn't or can't, though.

Andre Holmes

Hey this technology is evolving so fast as we speak before the book and coarse could be implemented half of the information would be obsolete. But yes we must teach the babies
and build Zion!

Gina

Great post. I think I am going to give this a try just so see if it is possible. . But yes, we have to stop being the consummate consumers. All the infrastructure in the world won't close any "divide" if we aren't empowered to do more than hand over our money to other groups who are innovating.

navarrowwright

Great Gina!
Let me know ho w it turns out for you. Good luck

Herb Pinder Jr.

A very timely article, Navarrow. I've been preaching for AAs to be technology producers vs. consumers for awhile (10+ years at least). I've built out technology platforms since GeoCities (latest: BlackBottom.com, BlackMeme.com, etc.) and have found that unless we begin producing, we remain limited to: consuming and over-indexing on other services (without the benefits and _very_ valuable learning experiences) and being completely outside/ignorant of the financial dynamics involved. One thing to the folks just starting in development: don't wait. Global competition isn't waiting for our community to get "up-to-speed" or caught up - do your due diligence and get started. Great article.

Facebook User

Thanks Herb
I also believe we have to widen or net in terms of the business ideas we focus on. We can be minority entrepreneurs but have global expectations.

Wm_Tucker

It needs to be said that technical skill sets are often separate from entrepreneurial skill sets, and that each has its somewhat unique mix of aptitudes, talent, cognitive & social skills, etc.. Af-Ams should understand we can continue diversifying our production as financiers, technocrats, executives, and merchants.

I'd like to also correct the suggestion that money/access to capital isn't a barrier to entry for a tech entrepreneur. There is an emerging class of Af-Ams with the technical skill to create say, proprietary software, and perhaps use that software as the basis for an enterprise, but whom lack the social and/or financial means and know-how for translating resources into a business. One habit more of us should value and employ is organization; the process of arranging work, time, capital, and authority in such a way that's conducive to running a business.

Gina

Wm_ Tucker you make an OUTSTANDING point.

"One habit more of us should value and employ is organization; the process of arranging work, time, capital, and authority in such a way that's conducive to running a business." - Love that quote right there. I've labeled it "interpersonal infrastructure". Its my focus for the year 2010

While the barrier's to entry into digital media content creation are relatively low. Once you pass the initial barrier of creating content. Black innovators run into the same brick wall previous generations and industries have encountered which is access to capital.

You also made a great point about the skill set distinctions between entrepreneurs and those with technical skills. They aren't one in the same. I work with bloggers mainly and I fear that many of them feel that Google Adsense is going to drag them into some type of economic promised land.

Some of the smartest and most gifted people in the world can't run a business nor or they necessarily willing to take the risks inherent in working for yourself. Nor can they speak the language of potential sources of financing or other resources.

Though I think having some rudimentary skills it a great asset for an entrepreneur to have because it provides a greater understanding about how things work, its not necessary.

So then the question becomes how do people with these two distinct skill sets collaborate. Do we try to turn innovators into entrepreneurs? Would someone who builds things enjoy the hassles of entrepreneurship? Or is there some structure that you impose which makes this work.