A year ago as our local and global economies were kneecapped by COVID, amidst the fear and ruin were some signs that this dramatic reset might actually have some positive economic and societal outcomes. I and many people saw a huge opportunity to use the downtime from “business as usual” to recognize and dismantle the most destructive parts of America’s no-safety-net economy.
What an amazing thing it was to witness so many people and businesses taking this opportunity! In those early months of the pandemic there was a surge of cooperative action to support each other, including neighbors shopping for each other, mutual aid groups delivering food to households in need, and businesses pivoting their operations both to survive and to serve their communities.
In public discourse, essential workers were recognized and their value finally acknowledged. People and businesses and even some politicians started talking about how to care for workers better and move towards a wellbeing economy. Policies like paid sick leave gained traction. Enterprises of all kinds were forced to innovate to protect their workers and customers, and in many cases there was a new institutional openness to discussing structural changes such as normalizing remote working and recognizing the value of public health care.
We need a paradigm shift and looking at our growth dependency is an important place to start.
Today, some of those changes have grown roots, but too many have withered on the vine. It’s a drag to feel “business as usual” creeping in, even as I applaud the instances of real change.
For every employer who took the opportunity during the pandemic to re-evaluate whether their workers are adequately compensated and cared for, there are many more who are more concerned with regaining lost productivity and profits.
For every workplace that adjusted their growth goals to reflect new realities post-COVID, there are many more that are ignoring the signs that their business model depends on unsustainable assumptions.
For every entrepreneur who has refocused their innovative energies towards solving pressing social and environmental challenges, there are many more who continue to chase the dragon of traditional financing models without questioning how these models contribute to widening wealth disparities, human suffering and environmental catastrophe.
I know I sound dour and pessimistic, which doesn’t totally reflect how I feel. Honestly I have had a real boost of optimism lately due to the amazing progress so many cities, states and countries have made against COVID; I’m especially proud of my state of New Mexico for leading the pack in the US in rates of vaccination, which has sent our infection rates plummeting. I’m seeing a surge in local hiring and thrilled to see many of my favorite local businesses start to bloom again post-pandemic. My family and I had our first meal on a café patio over the weekend, and it felt glorious.
There is a lot of great news on the COVID front lately (with major exceptions including Brazil and India) — but I can’t shake the worry that societally and economically we haven’t learned or changed enough from this experience. As an entrepreneurship coach, what I see is distressing. Sure, I understand that the Amazons and Ubers of the world aren’t going to lead the charge against extractive capitalism, but it depresses me to see so many fledgling entrepreneurs and start-ups embrace the same model without even realizing it.
The obsession with venture capital and scaling and becoming the next unicorn is at best a fantasy, and at worst a ploy by the banking and investment industry to hook more entrepreneurs into the “scale or bust” mentality. Even though VC is appropriate for only a tiny percentage of startups (literally like 2% or less), the entrepreneurship industry pumps out endless content pushing this fantasy — articles, conferences, presentations, webinars, accelerators, incubators, programs, initiatives and more — with the predominant voices coming from venture funds, private equity firms and banks. Regular folks Googling for info on starting a small business will typically find a few articles with actual strategy or practical information, but oceans of resources about pitch decks, private equity, venture capital, capital and more capital.
We can still leave room for unicorns.
I get it. Small businesses need money to grow. The problem I have is with unexamined assumptions about growth being a universal good. We need a paradigm shift and looking at our growth dependency is an important place to start.
The predominant narrative in the entrepreneurship industry is that the solution to every problem is capital. More money. More growth. More glory. Even the movement to improve access to capital to BIPOC entrepreneurs and underserved populations is playing a stacked game. Don’t get me wrong — I’m not against leveling the playing field. If white entrepreneurs are getting funded, then of course BIPOC entrepreneurs should too.
But shouldn’t we be talking about how typical growth goals and GDP tunnel vision are steering us into the rocks? Too few are willing to acknowledge the fact that pushing more loans or equity investment funds to small businesses continues the flow of wealth and assets towards an ever smaller and richer sliver of the population.
There is a reason why this narrative dominates the media around small business and entrepreneurship. Bankers tend to do well when businesses borrow money. Investors tend to do well when businesses scale and sell ownership shares.
When businesses stay small and thrive at a more modest scale, the owners and their communities tend to do well. And I feel that this segment of entrepreneurship deserves more attention, respect and support.
Enough with the fairy tales of eternal economic growth. I’m tired of small business “resources” that are thinly veiled marketing campaigns for banks selling money to startups who would be much better served with more simple, practical resources: assistance with planning, bookkeeping and strategy, for example. We need a new narrative with new heroes and a whole different concept of a happy ending. We can still leave room for unicorns, but let’s not leave the horses hungry.