Wednesday, September 7, 2011 BY: Jennifer Larino, Staff Writer
Daniel Smolkin was 17 when Hurricane Katrina and flooding after levee failures forced his family from their Lakewood South home into the center of the startup universe.
Smolkin says he shared the heartbreak that came for so many evacuated families as he made the abrupt transition from bunking with relatives in Palo Alto, Calif., to planning a new life 2,250 miles away from New Orleans.
But Smolkin said he was soon drawn into the startup community rooted near Stanford University and feeding off the energy around large companies such as Hewlett-Packard and Amazon.
He picked up small jobs with startups ranging from search engine technology to garment printing.
Smolkin, who graduated with a degree in public policy from James Madison University in Virginia in May, is now exploring building a career with a fast-growing startup or even starting a company of his own. But hes more interested in returning to New Orleans than Silicon Valley to do so.
Smolkin is one of more than 400 recent college graduates to apply to Venture for America, a national nonprofit that will send young graduates to work two-year stints with startups in New Orleans, Detroit and Providence, R.I. The nonprofit plans to place 50 graduates next summer and about 15 will make their way to New Orleans.
For graduates such as Smolkin, a VFA assignment is a rare avenue to cut entrepreneurial their teeth and a vital talent pipeline for New Orleans startups.
The program will also be one of the first formal tests of the sticking power New Orleans has among young, entrepreneurial talent.
Venture for America founder Andrew Yang said he spent years watching young grads try to crack into the startup scene while running a test preparation and education services startup in New York.
I met hundreds of enterprising recent college graduates who were trying to put themselves in a position to get into startups. They all were struggling to find that runway, Yang said.
Yang modeled Venture for America after Teach for America, a program partially funded by the government that placed more than 5,000 recent graduates in two-year stints at high-needs schools throughout the country last year alone. Venture for America will use a mix of private donations and corporate sponsorship to fund its mission.
Yang said New Orleans fell into the mix as he toured the country looking for entrepreneurial communities in cities that are affordable to live and do business in, are attracting young talent and represent the shifting economic landscape facing all U.S. cities.
Entrepreneurs are much more likely to be successful in an environment in which they have a network surrounding them, Yang said. The goal would be that if these (alumni) then wanted to start their own company, they would find New Orleans a good place to do it.
New Orleans entrepreneurs say the selection underscores the strength of the local startup ecosystem after more than a decade of growth. They also note the program will test how supportive that ecosystem is once fellows complete their two-year commitment.
Chris Schultz, a New Orleans entrepreneur helping fund Venture for America and founder of Launch Pad, a collaborative workspace for New Orleans entrepreneurs, said the local startup community still has gaps to fill to keep growing.
One of them is fresh meat, smart people with new ideas, Schultz said.
Brent McCrossen, a New Orleans native and CEO of Audiosocket, said the city has gotten better at attracting young talent since Katrina, but the 4-year-old music licensing technology firm still faces challenges in finding local talent.
My objective is to retain talent in this city and attract talent to this city at all costs, McCrossen said.
McCrossen said Venture for America provides that opportunity at an affordable rate. VFA startups must agree to pay fellows between $32,000 and $38,000 with benefits.
Chris Reade, owner of Carrollton Technology Partners, a New Orleans-based technology development firm, added that VFA fellows are likely to be driven and committed to the local startup mindset.
If youre a Harvard business grad and you wanted to just make money, you would just go to McKinsey and Co. and make money, Reade said.
Reade and McCrossen note that a lack of talent and venture capital could be hurdles to keeping driven fellows here. Reade worries those who plan on starting their own firms will go where they get funded.
And we have the worst capital raising environment Ive ever been around, Reade said.
Yang said the goal of Venture for America is to foster more startups.
If they go and move to Atlanta and start a company and create jobs there, that is still a win from our perspective, Yang said.
But he notes New Orleans has a strong startup support network that is likely to keep fellows in the area.
Kira Orange Jones, executive director of Teach for America Greater New Orleans, notes a similar support network among local educators is the reason 60 percent of New Orleans TFA alumni now stay in the city. She points to aggressive efforts from New Orleans schools to cultivate and support new teachers as well as diverse career options outside the classroom.
Theyre coming and staying at a rate that is as high as New York City and the San Francisco Bay area, said Jones, adding that 80 percent of New Orleans alumni still work in education.
John Elstrott, executive director of the Levy Rosenblum Institute for Entrepreneurship at Tulane University, said a similar support network is growing for entrepreneurs at local universities and institutions such as Idea Village, the New Orleans Bioinnovation Center and Launch Pad.
He added the New Orleans Startup Fund, a nonprofit venture fund started last year by regional economic development leaders, is filling out the capital gap.
I would say weve got real sticking power now, Elstrott said.
Schultz said he, too, is confident the New Orleans lifestyle and startup support system is strong enough to retain talent. But bolstering funding before the first class of Venture for America fellows makes its way through the program cant hurt.
The best thing we can do to keep them here is to fund them, Schultz said. I hope were ready.