This is a hot button issue – how to create jobs in the most efficient manner. Two suggestions come to mind (disclosure: one of which I am working on and the other I advise).
Education is the key to growth. My parents grew up poor and didn’t have a lot of money and always pushed education on us. Education is the key to enlightenment I learned growing up. Education is important though It doesn’t correlate to entrepreneurial success. Entrepreneurship is the key to job creation and innovation and productivity. You can create the best drug though commercializing it and taking it to market is how you will save people and how you can monetize it and create jobs out of it. The Entrepreneur goes to market. We should encourage education and encourage people to start businesses.
So two suggestions to spur innovation:
- Entrepreneurial Certification: There are lots of accelerators such as Y Combinator and TechStars that help accelerate and launch companies. The focus of their content is on tips and tricks and education around launching companies and accessing capital. Well, not every entrepreneur wants to or can run a tech company. Maybe you’re a baker and want to open a new bakery. We propose making a certification program where we teach would be and current entrepreneurs and small business owners tools to make their businesses more successful. Learn how to ask the right questions and analyze your business and tap into a relevant mentor network. The process we came up with is a 1 Day MBA – learning in 24 hours of content an overview of entrepreneurship and how to ask the right questions. We are developing this with a university so that you can apply those credits towards more formal education and SO YOU CAN GET STUDENT LOANS TO PAY FOR IT. We would also support it with tons of free content. What do you think will lead to more productivity – a $120,000 4 year degree in entrepreneurship from the university of online or a $10,000 certification that in 10 weeks gives you basic tools and puts you in a team to help start a company? Which is more likely to lead to job creation?
Now lets amp it up a bit. Imagine if you can get student loan forgiveness in exchange for job creation so if you create a certain number of jobs in a certain amount of time, your student loans are forgiven. You spur the economy, your education is on the government. If you don’t do anything with your education, its yours to keep, you just need to pay for it. Right now there is student loan forgiveness if you work a certain amount of time in the public sector – now lets apply that same flexibility to value creation and I think we can start a revolution of innovation.
- Accelerators for everyone: Now assume you already are running a business and could use a bit of help and a bit of capital. The government should support forgivable convertible loans to accelerators across a number of industries. I would allow people that have had a certain amount of industry experience and success (lets say needs to have sold a company in the space or 3 years of profits over $1MM a year to qualify or a track record of IRR over 3 years ) and then the government will provide matching financing up to say $50,000 in a forgivable convertible loan to coinvest with approved seed financing groups and accelerators. This will put more capital into the system in a very small but focused way to spur a lot of entrepreneurship across multiple segments. Maybe you invest $10,000 and the government matches with a $10,000 loan, maybe its $50,000. Either way its piggybacking on relevant smart people and putting in a lot of small bets into job creation. Startups start small. Spur them on. In certain areas where there is not enough capital, make it 3:1 government leverage with a minimum of $10,000 investment. Make it really easy to tap small amounts of capital with proven partners.