The holiday decorations are all put away, you've survived another big visit from the family, and you're already a little behind on your new year's resolutions. But you can be excited about 2013's prospects for both your startup and the entrepreneurship ecosystem as a whole.
Here are my 2013 predictions for entrepreneurship:
- Crowdfunding will mostly benefit small businesses rather than high growth tech. Lots of companies are excited for the SEC to clarify the crowdfunding rules under the JOBS Act because it might help their startups raise some much-needed capital. But the truth is that the main beneficiaries of the new investment rules will likely be small local startup companies like restaurants, services or retail. That's because the high-growth tech companies with the strongest business models will continue to rely on traditional methods for raising capital. There is no shortage of capital for strong startups. And the novice investors who are excited to invest for the first time on crowdfunding sites will be drawn to safer investments that they either understand or have some sort of connection to, i.e., a business in their community that they'll be able to see and use.
- This year will be the tipping point in entrepreneurship education, as large numbers of universities adopt experiential education models. In the next 12 months, a significant number of universities will begin to shift away from traditional entrepreneurship education focused on teaching students how to create business plans to programs designed to create and validate business models. Universities will adopt experiential programs that encourage most of the learning to happen outside the classroom where students will interact with potential customers and attempt to prove or disprove their assumptions.
- 2013 will be the year of startup communities. Communities of entrepreneurs in small and medium cities have been trying for a number of years to create ecosystems and make it just as easy to build a startup and raise capital in their hometown as it would be in Silicon Valley or some other entrepreneurial mecca. What makes 2013 different is that we've finally figured out the right set of tools to jumpstart entrepreneurial ecosystems. Thanks to thought leadership from Brad Feld and the emergence of programs like 1 Million Cups, entrepreneurship communities all over the country will blossom in 2013.
- Entrepreneurs will finally come to understand that angel investors do not invest in ideas. Those aspiring to find an angel investor will finally wake up in 2013 and realize that they can't just dream up an idea, write a good business plan and go raise money. Angels are not donors. They are investors. And while they do invest earlier than venture capitalists, they still want to minimize their risk and have minimum requirements for customer development and business model validation. They need prototypes. They need customers. They need traction. This year, entrepreneurs will finally figure that out.
- This will be the year of the requested startup. Big companies and governments are no longer waiting for innovative ideas to come to them. They know the areas in which they need to create solutions, and they will sponsor competitions and challenges to get startups interested in tackling their projects.
2013 is going to be an incredible ride. Please use the comments below to make your predictions.
Diana Kander is an entrepreneur-in-residence at the Kauffman Foundation and an author at www.dianakander.com.
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