In 2009, the Obama-Biden Administration elevated the startup entrepreneur as a key piece of America’s recovery from the Great Recession. This wasn’t a particularly partisan decision—there was broad-based Republican support for it. Nevertheless, it was a fundamental transformation in how the federal government views entrepreneurs.
The decision to invest government resources to promote high-growth startups was based on three important facts. The first was data from the U.S. Census Bureau showing that young, high-growth businesses were responsible for the majority of net job creation in the United States economy from 1980-2009. Secondly, through the work of Steve Blank and Eric Ries, there was greater awareness that startup companies are different from small businesses and large corporations. They share characteristics of both at different times in their existence but need distinct policies to reflect their unique growth trajectory. And thirdly, there was a realization that America’s large companies in 2009 had embraced a policy of offshoring and outsourcing and would not likely be enticed to build large factories in America without significant subsidies.
