One of the strangest things about the work on small business and entrepreneurship I’ve been doing in the United States for the past few years is that people in the wealthy classes and the tech world don’t believe it. As government policies and business culture have shifted to favor large businesses, the number of firms being created each year is declining, companies are getting older, and today’s entrepreneurs (women and people of color) have a harder time raising capital. But the news is so good in the tiny tech part of the economy (only about 1% of startups receive VC funding) that it obscures the truth for the other 99%.
Yet, the business world may be beginning a slow reckoning with how the past few decades’ obsession with size and technology has likely made the U.S. economy less dynamic — which in turn is critical because a dynamic economy enables people to build wealth and move between classes.
Harvard Business Review’s Thomas Stackpole reviewed a handful of recent business book releases this month, running down a list that sounds like the usual suspects: books about Jeff Bezos, WeWork, Tencent, and an analysis of unicorn companies.
Myths are fun to read about, he notes. And then Stackpole lands on the book I wrote with venture capitalist Seth Levine, The New Builders.
“The authors argue that while tech stars hog the spotlight, small-business entrepreneurs—especially Black, brown, female, and older founders—make up a significant portion of the U.S. economy and run companies that operate in and benefit their communities. And yet “our systems of finance and mentorship have failed to keep up,” so entrepreneurship and economic opportunity are declining.”
“There’s nothing wrong with obsessing over what leads to success,” Stackpole writes. “We can learn a lot from stories of how others achieved great things. The trick is not to take the wrong lesson. Myths may contain seeds of truth, but they’re often mostly fairy tales. Can you tell the difference?”
I’m proud to be the co-author of the myth-busting book in that rundown. It reminded me of what Gene Roberts, the legendary editor of The Philadelphia Inquirer and a journalism school professor of mine at the University of Maryland, said about how to be a good journalist. When the crowd heads in one direction, you go in the other.