The science of startups
Research conducted by Ted Zoller, director of the Center for Entrepreneurial Studies at Kenan-Flagler Business School, on dealmakers and entrepreneurial networks was part of the National Advisory Council on Innovation and Entrepreneurship (NACIE) forum.
The recently launched Blackstone Entrepreneurs Network – which will work to turn innovative ideas into successful companies in the Research Triangle Park – is based largely on his ideas.
In addition to his duties at UNC, he is vice president for entrepreneurship at the Ewing Marion Kauffman Foundation, the leading national philanthropy with a specific focus on entrepreneurship. The following article ran in the University Gazette this spring.
Ted Zoller’s interest in studying regional entrepreneurial ecosystems took on heightened urgency when the global financial system appeared on the brink of collapse in fall 2008.
The project took nearly three years of painstaking research to identify the central players, not only in the Research Triangle’s economy, but also in 11 other entrepreneurial hot spots across the country.
Zoller said the work got off to a fast start thanks to his Rolodex, stuffed with the names of hundreds of people he had come to know since he began teaching entrepreneurship at the Kenan-Flagler Business School in 1999.
Included were the names of faculty members, students and community members who took “Launching the Venture,” the course he founded and has taught, and that has led to the creation of more than 100 viable companies in the Triangle since its inception a decade ago.
Included were the names of venture capitalists that innovators must seek to acquire the necessary financial backing for turning their ideas into feasible companies.
Included were the names of entrepreneurs – people with the skills, experience and access to money that can turn great ideas into growth companies.
And included were the names of dealmakers who help to form social networks and broker within them to make things happen.
The investor brings funding. The entrepreneur brings business savvy. But the dealmaker, by fusing the two together, brings the all-important power of connection.
“I like to think of dealmakers as serial entrepreneurs,” said Zoller, director of the Center for Entrepreneurial Studies and associate professor of strategy and entrepreneurship at the business school.
“They are individuals who build multiple companies, who invest in multiple companies and who advise and guide multiple companies. These are the people who are the market makers of the economy. They are the critical catalysts who bring innovators, entrepreneurs and investors together.”
Zoller outlined the integral role dealmakers play within the 12 nationwide entrepreneurial zones with a concept called the “Dealmakers Algorithm” that uses transaction data to infer the preferences of investors, which in turn, entrepreneurs can use to identify people to fund their ventures.
His painstaking research, when mapped in graphic detail, brings into sharp relief the relative strengths and weaknesses of the Triangle’s entrepreneurial ecosystem compared to the other 11 regional economies. Those regions are Boston; Silicon Valley, Calif.; Phoenix; Seattle; Minneapolis and St. Paul; Orange County, Calif.; San Diego; Salt Lake City; and Austin, Texas.
Like the Triangle, all have been referred to as “technopoles” because of their heavy concentration of high-tech industries, Zoller said.
Published June 23, 2011.