Last year, the Kauffman Foundation noted that virtually all U.S. net job creation since 1980 has come from companies less than five years old. From 1977 to 2005, existing companies were actually job destroyers, losing 1 million net jobs per year; in contrast, new businesses added an average of 3 million jobs annually. The message seems simple: if we are serious about addressing the unemployment crisis, we need to fund and nurture new company formation.
Where does the responsibility lie in finding, financing and growing these new startups? Historically, that role was the domain of venture capital firms scouring the countryside, analyzing business plans, and committing the seed-level investment capital needed to launch a new venture. Despite the savvy of the best and brightest, the track record of VC-backed startups is humbling at best; only about 1 in 100 ever gain traction and scale to the point of sustainability. A new bond is being fostered today in which both the private and public sector, working together, can change this dynamic by promoting and supporting innovative early stage companies. Real world examples of this public/private initiative are beginning to emerge, with the city of Boston’s Innovation District being one of the most ambitious.
To read the full, original article click on this link: How To Start Up U.S. Job Growth: Nurture Startups - CIO Central - CIO Network - Forbes
Author: William Clifford
