Entrepreneurship almost always involves pushing against the status quo to capture opportunities and create value. So it shouldn’t be surprising when a new business model, such as ridesharing, disrupts existing systems and causes friction between entrepreneurs and local government officials, right?
But imagine if the road that led to the Seattle City Council ridesharing hearings this month — with rulings that sharply curtail UberX, Lyft, and Sidecar’s operations there — had been a vastly different one. Imagine that public leaders had conceived and built a platform to provide this new, shared model of transit. Or at the very least, that instead of having a revolution of the current transit regime done to Seattle public leaders, it was done with them. Amidst the acrimony, it seems hard to imagine that public leaders could envision and operate such a platform, or that private innovators could work with them more collaboratively on it — but it’s not impossible. What would it take? Answer: more public entrepreneurs.
The idea of ”public entrepreneurship” may sound to you like it belongs on a list of oxymorons right alongside “government intelligence.” But it doesn’t. Public entrepreneurs around the world are improving our lives, inventing entirely new ways to serve the public. They are using sensors to detect potholes; word pedometers to help students learn; harnessing behavioral economics to encourage organ donation; crowdsourcing patent review; and transforming Medellin, Colombia withcable cars. They are coding in civic hackathons and competing in the Bloomberg challenge. They are partnering with an Office of New Urban Mechanics in Boston or in Philadelphia, co-developing products in San Francisco’s Entrepreneurship-in-Residence program, or deploying some of the more than $430 million invested into civic-tech in the last two years.
There is, however, a big problem with public entrepreneurs: there just aren’t enough of them. Without more public entrepreneurship, it’s hard to imagine meeting our public challenges or making the most of private innovation. One might argue that bungled healthcare website roll-outs or internet spying are evidence of too much activity on the part of public leaders, but I would argue that what they really show is too little entrepreneurial skill and judgment.
The solution to creating more public entrepreneurs is straightforward: train them. But, by and large, we don’t. Consider Howard Stevenson’s definition of entrepreneurship: “the pursuit of opportunity without regard to resources currently controlled.” We could teach that approach to people heading towards the public sector. But now consider the following list of terms: “acknowledgement of multiple constituencies,” “risk reduction,” “formal planning,” “coordination,” “efficiency measures,” “clearly defined responsibility,” and “organizational culture.” It reads like a list of the kinds of concepts we would want a new public official to know; like it might be drawn from an interview evaluation form or graduate school syllabus. In fact, it’s from Stevenson’s list of pressures that pull managers away from entrepreneurship and towards administration. Of course, that’s not all bad. We must have more great public administrators. But with all our challenges and amidst all the dynamism, we are going to need more than analysts and strategists in the public sector, we need inventors and builders, too.
Public entrepreneurship is not simply innovation in the public sector (though it makes use of innovation), and it’s not just policy reform (though it can help drive reform). Public entrepreneurs build something from nothing with resources — be they financial capital or human talent or new rules — they didn’t command. In Boston, I worked with many amazing public managers and a handful of outstanding public entrepreneurs. Chris Osgood and Nigel Jacob brought the country’s first major-city mobile 311 app to life, and they are public entrepreneurs. They created Citizens Connect in 2009 by bringing together iPhones on loan together with a local coder and the most under-tapped resource in the public sector: the public. They transformed the way basic neighborhood issues are reported and responded to (20% of all constituent cases in Boston are reported over smartphones now), and their model is now accessible to 40 towns in Massachusetts and cities across the country. The Mayor’s team in Boston that started-up the One Fund in the days after the Marathon bombings were public entrepreneurs. We built the organization from PayPal and a Post Office Box, and it went on to channel $61 million from donors to victims and survivors in just 75 days. It still operates today.
Public entrepreneurship is entrepreneurship. It’s the pursuit by public officials and their collaborators of opportunity without regard to resources controlled. First year students at Harvard Business School are taught that entrepreneurs face substantial risk in pursuing a new opportunity and a basic Catch-22 that comes with it: that it’s difficult to reduce risk without resources and difficult to attract resources while risk is high. Public entrepreneurs face the same predicament. The course teaches four tactics to cope with the challenge: lean experimentation, scaling, partnering, and storytelling. We can create public entrepreneurs by teaching these skills, more often and jointly, to future public leaders and their partners. And we can teach them well if we recognize that public entrepreneurship is entrepreneurship, but that it also takes place in a different context and requires nuanced application of these tactics.
- Lean experimentation and tests with something less than the final product can seem scary in the public sector, but special opportunities exist, too; public press and community engagement can sometimes serve as “smoke tests,” and even public betas can work well if they are managed right.
- Scaling too fast — especially by adding too many personnel and too much hierarchy — can be a particular pressure for public sector officials who are accustomed to working in big institutions; scaling too slow can mean too little growth/commitment when political leadership changes over.
- Partnering is de rigueur in the public sector today, but the officials must keep the power dynamic in mind and keep the “public” in the public entrepreneur; questions of profit and intellectual property are especially complex and dynamic. And where is the line between “partnering” with the public and outsourcing work to them that they likely expected government to do? The public entrepreneur needs to understand how the tools she uses — incentives, rewards, etc. — can change the feeling and ultimately the value of their partnership with the public.
- Storytelling is an essential leadership tool and, if anything, this applies even more to public leaders, in whom press and public interest are especially acute. How does the public entrepreneur effectively leverage the pressure to “announce stuff” in ways that will provide incentives to run lean (as a cash flow curve would for private entrepreneurs) without foreclosing pivots and changes?
If we start with the basics of entrepreneurship, then consider the special context and dynamics of the public sector and closely examine the decisions and actions of public entrepreneurs, we can learn what makes great public entrepreneurship, and we can generate more of it.
It’s worth noting that public entrepreneurship, perhaps newly buzzworthy, is not actually new. Elinor Ostrom (44 years before her Nobel Prize) observed public entrepreneurs inventing new models in the 1960s. Back when Ronald Reagan was president, Peter Drucker wrote that it was entrepreneurship that would keep public service “flexible and self-renewing.” And almost two decades have passed since David Osborne and Ted Gaebler’s “Reinventing Government” (the then handbook for public officials) carried the promising subtitle: “How the Entrepreneurial Spirit is Transforming the Public Sector”. Public entrepreneurship, though not nearly as widespread as its private complement, or perhaps as fashionable as its “social” counterpart (focussed on non-profits and their ecosystem), has been around for a while and so have those who practiced it.
But still today, we mostly train future public leaders to be public administrators. We school them in performance management and leave them too inclined to run from risk instead of managing it. And we communicate often, explicitly or not, to private entrepreneurs that government officials are failures and dinosaurs. It’s easy to see how that road led to Seattle this month, but hard see how it empowers public officials to take on the enormous challenges that still lie ahead of us, or how it enables the public to help them.