Entrepreneurship, by its very nature, involves the assembling of resources to create new value. The entrepreneur has the difficult task of identifying and bringing together resources in order to create a model for creating value around a product, service, or idea. All sorts of support exists for the entrepreneur. There are countless books, internet resources, government and academic funded programs, and the burgeoning area of private sector support (incubators, accelerators, etc.). If you are unfamiliar with these types of businesses, here is an article providing an overview of the difference between and incubator an accelerators – Accelerator vs Incubator.
I spend a lot of time reading about the latest trends in the startup and small business environment. I am currently of the opinion that that there is a large void forming in the entrepreneurial support space. Most of the resources available in the market (capital funding, etc.) focus on the technology startup. Across the country, angels, venture capital firms, accelerators, are looking for the next big technology success. This is natural given the potential market size, ease of scalability, and lack of developed markets for the tech startup. These tech companies appear to be the new frontier for investors and entrepreneurs to stake their claims.
The unfortunate effect of this trend is to detract attention from the non-technology entrepreneur. While the traditional, mom-and-pop, lifestyle business doesn’t create the same level of attraction as the tech startup, these businesses should not be ignored by those in the entrepreneurial resource space. Many of these lifestyle businesses reach a profitable status and continue along with the same strategy in a given market for years. They have a proven business model that earns a consistent return on investment. In many cases, the only things that are lacking is growth and scalability. (Remember, Wal-Mart started as a lifestyle business in a small town in Arkansas).
Many day-to-day owners/managers of the small business lack the resources (knowledge, capital, marketing support) etc., to transform into growth-based high-potential ventures. In the same breath, many of the market resource providers ignore the small business and divert their resources to the new (and largely unproven) business model of the tech startup.
In conclusion, I believe that there is a great deal of untapped growth and value-creation potential in may of the small medium enterprises (SME) that exist in every local communities. We should not turn a blind eye to these SMEs for a glimpse at every new tech startup that comes by.