Bill Warner of Warner Research and TechStars Boston

Bill Warner, a great entrepreneur and one of Massachusetts’ most valued startup mentors, recently wrote a pair of posts about how to encourage new behaviors to increase our success in developing and retaining high technology companies in the region. Mr. Warner suggests a scorecard as a way to establish a common vocabulary for talking about success.  For example, a grand slam would be a company with a market cap of $10B or greater – something clearly to be encouraged.  He also provides the beginnings of playbooks – one for companies and one for the region – that outline the behaviors to be encouraged for growing great tech companies and re-establishing the region to its tech leadership position.

Let me start by thanking Mr. Warner for his efforts in building the tech and startup ecosystem in Boston. It is something everyone at BostInnovation (and Pinyadda, the startup I am working on) is very passionate about.  In order to build our region’s tech and startup ecosystem, this type of exchange of new ideas and innovative solutions is critical.

After reading both posts (here and here),including all of the comments from some of our most well-known Mass entrepreneurs (and sadly a lack of comments from just about anyone else), there are many points everyone generally agrees on (i.e. need for more angel investing, mentoring, etc.) and a few critiques (i.e. scorecard based on revenue, lack of diversity among those who formed the ideas).  I believe Mr. Warner’s posts provide some sound advice and clearly highlight some of the major issues our ecosystem currently faces.  Further, my general feeling is that it is great to have such effort and collective movement for something that is of the utmost importance to our region’s long term economic health.

In cutting to the core of the collective thought of those involved in the discussion so far, everyone recognizes:

1. The lack of seed funding and nurturing for young startups with big ideas.
2. The lack of big grand slam companies such as Google, eBay, etc. that help bolster the tech startup economy in the West.

It is great to talk about building global companies and recruiting talent and investors, but what I would like to focus on is what I believe to be the most significant issue we face and some concrete actions we can execute on to move the ball forward.

As much as I agree that we need to strengthen the angel community…

The biggest issue our ecosystem faces is a structural deficiency.

In 1973, a sociologist by the name of Mark Granovetter from Johns Hopkins published a paper,”The Strength of Weak Ties“, which is the most cited paper about social network analysis to date.  Granovetter studied “the degree of overlap of two [people's] networks” and the “impact on diffusion of influence and information, mobility opportunity, and community organization.”  I believe the results of Granovetter’s study can provide us with some useful insight on the matter at hand (not to mention its geo-relevance – Granovetter conducted much of his research on job seekers in the Boston area).  Granovetter found that new information was typically passed to people through what he called “weak ties”, meaning people you do not interact with on a regular basis.  The reasoning is that your “strong ties”, or the people you interact with regularly, tend to have access to the same information as you.  Therefore, the diffusion of new information typically comes from people who regularly interact with other networks of people.

Simply put, our ecosystem’s deficiency is we have too few weak ties.  We need to develop and nurture these weak ties to strengthen the networks needed to support the technology economy we all envision.

Let’s look at the reality of our ecosystem today.  In the past several months, I have visited or attended events hosted by the following:

• Web Innovators Group
• Cyberposium at HBS
• Babson Entrepreneurial MBA program
• Open Coffee in Cambridge
• DEMO conference event hosted by Xconomy
• MassChallenge
• New England Innovation
• Mass Technology Leadership Council
• Dogpatch Cambridge
• Techstars
• Greenhorn Connect
• Dart Boston
• Boston Young Entrepreneurs
• Member of The Leadership Program

(And these are just the ones I can think of off the top of my head!)

In comparing events, like WebInno and HBS’s Cyberposium (or pick any of the others), very few of the attendees overlap.  There usually are a handful of familiar faces but not many.  While there is a significant amount of activity going on in the area, the level of connectivity is lacking.

As an exercise, I suggest that people in the tech/startup community do the following:

1. Make a list of all the “weak ties” you have that are somehow involved in the tech startup community here (i.e. people you email 2-3 times per year or occasionally interact with on social networks, say 1-2 times per quarter).
2. Break down these ties by the “sub-communities”, for example:

• Colleges & Universities – if you know the person through a connection to MIT, Harvard, Babson, or any other school.
• Events – if you know the person from regularly attending an event such as WebInno, Mobile Mondays, Mass Innovation Nights, Open Coffee, etc.
• Work ties – if you know the person from working with them in some capacity.
• Programs – if you know the person through a program like TechStars, The Leadership Program, or any other entrepreneurial or tech programs.

Take a look at the total number of weak ties you currently have and how spread out they are across the different sub-communities.  How plentiful and diverse are your weak ties?  Hopefully you have several across each type of sub-community, but try the following to expand and diversify your network:

1. Attend one of the events you do not typically go to, bring a friend who wouldn’t typically go, and don’t leave until you have found at least one good contact that could become a serious weak tie to stay in touch with.
2. If you are lopsided in one particular academic network, reach out to the numerous entrepreneurial groups at any one of the colleges in the area (MIT, Harvard and Babson aren’t the only schools here…) and see what they are working on, invite them to come check out what you are working on, or just set up a time for the people in your network to grab a beer with some people from their network.
3. Hit up a random startup offering to test their product or service.  I think this is the biggest disconnect I see in the area – a lack of fervent early adopter types willing to relentlessly give feedback and then come back after iterations have been made by the companies.

If you are an investor (angel or VC):

1. Make a list of every early stage startup you can name off the top of your head in the area.
2. If your list is seriously lacking, email us at BostInno check back through the WebInno presenters, Dart Boston presenters, companies on VentureFizz, etc.
3. Count how many young entrepreneurs you have that are weak ties – not necessarily that you are looking to invest in, but that you see potential in and with whom you are interested in staying in touch.
4. Group them in to sub-communities as mentioned above.
5. Reach out to new young entrepreneurs to start creating weak ties – invite them out for a beer, coffee, what have you.  If you need people, you can hit us up at BostInno, we know plenty.
6. Specifically for VCs – if a company truly is too early for you that you see potential in, have a list of 2-3 angels willing to accept introductions – we know you’ve got them!
7. Specifically for angels – get rid of the pay to pitch BS.  Everyone should boycott this.  See Open Angel Forum http://openangelforum.com/

Here at BostInnovation we will:

1. Start hosting social events for people in the tech startup community – we don’t always have to be hosting panels and giving pitches.
2. Start looking in to the idea of starting various sports leagues for people involved in tech startups.

At the end of Granovetter’s paper, he cites a 1962 study on Boston’s West End community, which was unable to mobilize against “urban renewal” projects.  Granovetter found that the members of the community typically worked within the West End neighborhood and shared many of the same connections.  Charlestown on the other hand was able to successfully form an organization to prevent the urban renewal projects.  When taking a look at the structure of the community in Charlestown, most of the people worked outside of Charlestown and had developed diverse weak ties leading them to effectively mobilize a stronger and broader effort. We need to make sure that we are playing our part in making our ecosystem like Charlestown’s community structure, rather than the West End’s.

Thanks again to Mr. Warner for getting the ball rolling and to everyone who participated in the conversation.  I look forward to continuing this discussion and hearing from others in the area as to where they believe we need to focus our efforts.

Chase Garbarino is the CEO of Pinyadda.com, a web startup located in Downtown Boston.  You can follow him on Twitter @cgarb or email him at chase[at]bostinnovation.com.

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