The Latest in Economic Development – 4.2.2012

One comment

This week’s blog highlights two Wall Street Journal debates revolving around entrepreneurship and startup funding, gives a deserving mention to an increase in women-owned businesses in New York, and explores the recent explosion of interest in learning how to code. Comment below or send to

Get the last edition of “The Latest in Economic Development” here.

Many pundits bemoan the fact that US business education is not churning out enough entrepreneurial minded students, which usually leads to the question: Can entrepreneurship be taught? Noam Wasserman thinks it can. He believes that students can benefit from learning the potential “pitfalls” of starting a business, as well as the core functions (marketing, finance, etc.) necessary for operating. Wasserman admits some aspects of entrepreneurship cannot be taught, such as closing a sale, but he says that “every day, ill-advised and easily avoidable, decisions are killing off great ideas that could help restore entrepreneurial magic to our economy.” By educating these idea-generators, we could “increase their success rates – and give the country a boost along the way.” Victor W. Hwang takes the opposite view – that real world experience is the best classroom for entrepreneurs. He says that “much of what traditional entrepreneurship classes teach – the best ways to avoid mistakes – is misguided.” Instead of formal education, entrepreneurs benefit from a solid network of mentors while being free to make mistakes and take risks. (Wall Street Journal)

About half of US states have implemented policies designed to get more capital into the hands of startups through tax credits to angel investors, but is this a sound strategy? David Weaver, arguing for more funds, supports the strategy. He says that the efforts of existing venture capitalists, banks, and government and nonprofit grants are not enough to adequately support startups. By making tax credits available, funding for startups increases in two ways; they “keep more money in the pockets of existing angel investors – money that can be plowed back into a company an investor has already funded” and they can “help to create new angel investors.” Jeff Cornwall thinks otherwise for a very simple reason; “they don’t deliver on what they promise.” He also says that since only a very small number of small businesses receive angel capital, the effects of angel capital tax credits are negligible. (Wall Street Journal)

Owing to a tough employment market, the number of women-owned businesses (in NY) is on the rise. The state’s women-owned businesses are up 71.1% from 1997 and up 31.2% in the New York City metro area. Another reason for the increase is efforts by NYC’s Economic Development Corporation, which has developed programs over the last few years to encourage more entrepreneurial ventures by minorities and women. One potential gap that needs to be filled is more assistance to companies that are already established and looking to grow. Maria Ortero, founder of the Women’s Venture Fund, says of startup programs: “certainly that’s helpful, but now they are here, and they are looking to use their business to be a primary source of income. It’s hard to find a program that caters to that segment.” (Crain’s New York)

It is clear that a technology-based, “creative class” economy requires a workforce (at least a large portion) with the aptitude to understand the language of computers. Computing and non-computing professionals are starting to figure this out, signified by increasing demand for “coding” education, and the market response. Jenna Wortham writes that “some in the crowd foster secret hopes of becoming the next Mark Zuckerberg. But most have no plans to quit their day jobs – it is just that those jobs now require being able to customize a blog’s design or care for and feed and online database.” Zach Sims, a founder of Codecademy – probably the most popular site that teaches how to code – adds, “they don’t just want to use the Web; they want to understand how it works.” (New York Times)

1 comments on “The Latest in Economic Development – 4.2.2012”

Comments are closed.