Ladies, Be Careful Not to Silence Yourself

Shelley Klingerman | Managing Entrepreneur for NEXT Studios and CEO & Founder of Stiletto Agency

Photo by Chelsi Peter from Pexels

Building a company with partners is a whole different experience than building a company by yourself. Ask me how I know. Both are rewarding and challenging, but they are different journeys. When you build a company yourself, you are 100% in control of the decisions that, for the most part, only affect you.  It’s your success or your failure and you know that. It could be a great payoff for you, but you could also lose it all if it doesn’t work.  And when it’s just you, you can control the level of risk you’re willing and comfortable in taking. Most likely that level of risk will come with a lot of questions; such as, “Do you have another source of income to get you by? Do you have a spouse that can support you while you test the waters?  Are you going to jump in with both feet and burn the boat?”  It doesn’t matter what you do, because you only have to “worry” about yourself.  You can’t be silent because you’re talking to yourself and making independent decisions that you will immediately know about.

In a partnership it’s different. You are bringing various experiences and perspective to the table to build a company. No single partner’s thoughts, opinions or experience trumps another, UNLESS YOU LET IT.  If you don’t speak up, it’s on you. Most partnerships come together because everyone is bringing an important perspective to the table and you are stronger together than you are independently. Always keep that in mind, you are there for a reason.  There might be times when you feel your perspective doesn’t align with the majority so, “I must be wrong” or you trust the others. That’s common, however, your purpose for being at the table is to disrupt the group think and provide a DIFFERENT perspective. One that might be completely opposite of what’s being discussed, but it’s your responsibility to make sure it’s considered.  It might not be the way things go, but at least it was considered.  I’m here to tell you, it can be intimidating and misinterpreted (by you) that, “I don’t see it that way, so I must be wrong”.  Yet, it is so important that you don’t silence yourself. You need to be heard for the benefit of the company that you’re equally responsible for building and its success. If you are a female, this whole experience has the potential to be exacerbated.  

As someone who is passionate about this challenge, I spend a lot of time empowering women on how to seize control of their safety through my work in Stiletto Agency, as well as empowering visionaries (entrepreneurs) to seize control of their future through my work as a Managing Entrepreneur with NEXT Studios. And to be completely honest, I spend a lot of time managing this for myself. Ladies, if we’re going to come to the table, we have to check any insecurities, passiveness, and 100% trust at the door. Acknowledge feelings when they surface and know they were given to you as tools to guide you through life in both personal and professional situations. There is NO feeling that should be dismissed. Every feeling/emotion has a very important role. Some are meant to pause you; others are meant to make you act. They are YOUR feelings. You own them. No one can tell you they’re wrong.  

You may allow others to provide you information that you can take into account to work through your feelings, but they can’t change them, only you can.  My point is, when something doesn’t FEEL right to you, it’s real. It might not be the way someone else feels, but that doesn’t mean your feelings aren’t valid.  When you’re building a company or making your way through a corporate environment, don’t not address something that doesn’t feel right to you.  Unchecked, these feelings will manifest into things like resentment or panic, which become a much larger distraction and can unnecessarily derail your success.

Women get concerned about being labeled, so we don’t speak up. We need to. For our own good and for the good of our business. Do not silence yourself. I often go back to this quote by Eleanor Roosevelt: “No one can make you feel inferior without your consent.”

The “gig” is up.

John McDonald | Managing Entrepreneur at NEXT Studios

Photo by Charles Deluvio on Unsplash

Sitting at home one evening feeling hungry, you pop out your phone and flip through the specials on DoorDash, looking for something you like. As you scroll, you remember that you’re out of napkins and paper plates, as there’s been a lot of takeout meals delivered to your house recently. You flip over to the local grocery store app and add them to the list for the scheduled delivery tomorrow. After placing your orders, you switch over to YouTube, looking for something entertaining to watch while you wait. Up pops a show from a favorite chef, and you’re inspired enough by what he’s making to add some of the ingredients to your grocery store order, and then to go to Amazon and order yet another specialty cooking utensil you’ll probably only use once.

Sound familiar? If your house is like my house, scenes like this play out every day, more so now than ever due to COVID. What you may not realize, though, is that each of these events represents an interaction with the gig economy — something that was already happening before the pandemic, but now has accelerated into a way of life for millions.

The gig economy is a system whereby organizations hire independent contractors to work for limited periods of time for a specific function. The name comes from an informal term used by musicians to describe being hired for a single performance or limited engagement, and it now perfectly describes all kinds of jobs beyond just playing a guitar. Essentially you as an individual have skills and have time, and these are in demand by other people who would like to pay for that time and skill, but not as a long-term or permanent employee.

The gig economy has been a part of food service for a long time, and the upending of the taxi industry through Uber and Lyft is well documented, but the growth in technology-based platforms has enabled locating, hiring and paying a gig worker infinitely easier that it was just a few short years ago. This has enabled the spread of the gig economy to now include writing, art and design, media and communications, software development, information technology and project management. Most interestingly, a significant portion of some traditional industries are converting to gig workers, including accounting and finance, legal work and education.

According to Gallup, about 36% of US workers are now involved in the gig economy, and if this growth rate continues, more than half the workforce will participate in it by 2027. This growth rate is three times faster than the growth rate of the workforce as a whole, according to Forbes. More importantly, according to McKinsey, 78% of gig workers say they’re happier than those working traditional jobs, 68% say they’re healthier, and 51% would not go back to traditional work for any amount of money. It’s clear that the gig economy is here to stay and isn’t just a COVID-related temporary disruption in how work gets done.

What is the long-term impact? It’s likely that there are several:

1. Every industry will be transformed by the gig economy. The transformation that has already occurred in short-distance ground transportation via Uber and Lyft is coming in every industry. For some, it is well underway: in 4Q 2020, 54% of the products sold on Amazon actually came from third-party independent gig economy sellers, and almost half of its deliveries are now done through gig workers. For others, such as legal and financial services, long-standing regulations are slowing the transition, but are not stopping it: legal assistance requests through gig economy platforms like Docketly jumped significantly as COVID began and have not slowed down

2. You will become part of the gig economy personally. If you’re not already offering your time and talents and resources through some sort of on-demand platform, you may be missing out on a personal business opportunity. Got a pickup truck? Uber launched Uber Connect, where you can hire out yourself as a driver to deliver small packages and materials to businesses or to a factory. Know how to code? Any number of online platforms would hire you now to develop or to test software written by others. Like to teach? Online academies and local school districts are looking for gig workers to fill in their teaching staff.

3. The gig economy represents a renaissance in entrepreneurship. Once thought reserved for the elite few, going into business for yourself is one of the principal ideas upon which our US economy was built. According to the Kauffman Foundation, all new job roles created in in America come from new startup companies — deciding to start a business and then making your first hire: yourself. This accounts for the high marks that gig economy workers give themselves related to fulfillment and sense of purpose, as well as their desire to stay with it and not return to traditional work.

So, how can you leverage the gig economy for your business? Here’s a few ideas:

1. Recognize that you probably already are. From how you source supplies to how you find new workers, you and your coworkers are probably already leveraging online gig economy platforms to get your work done. Identify what those are and look for ways you can expand their usage to save money and increase flexibility.

2. Look for jobs within your organization that could be gig economy jobs. The list today is much longer than it was even a year ago. Look for roles that can, or should be, done mobile or from home. Look for roles that aren’t time-dependent, meaning the work could be done at odd hours or on the weekends. Also, look for roles that can be done largely digitally, without the need for special equipment that might be found only in a single location. All of these roles have the potential to be made more flexible and dynamic through the gig economy.

3. Think about new ways you could leverage the gig economy to help your company grow. If there’s an app or platform that already offers what you do through the gig economy, consider becoming part of it. If not, consider starting up one in partnership with a technology incubator or studio.

There’s no doubt that the gig economy is a growing and important part of how work gets done today. While it was already happening prior to the pandemic, like so many things, it was greatly accelerated by it. The only question for you is if you will be the victim or the victor of this 2021 and beyond megatrend.

3 Questions: Demystifying Venture Capital with John McDonald

This is the first installment in our “3 Questions” series contributed by subject matter experts throughout the tech community in Indiana. This series takes complex tech topics and explains them in easy-to-understand ways without the dense jargon so every reader can learn a little bit more about our industry.

When we set out to build our first startup company, I had no idea how time consuming and confusing it would be to raise capital. I didn’t appreciate that it wasn’t just one of my jobs as the leader, it is the primary job as a leader of a startup company. 

Everything else flows from success in raising capital. It allows you to hire the people and partners you need to build the company and keep them aboard, which is the secret to any successful business. 

3 Questions:

What types of capital sources are available to startups?
What is the difference between the types of capital?
What are the keys to unlocking capital? 

There are primarily four types, and they align very nicely to the four stages of the development process of a new technology startup employed by venture studios everywhere like Central Indiana’s High Alpha and my own venture NEXT Studios. 

The first stage is ideation

This is where you create new ideas for startups, and “pressure test” those ideas by studying things like your target buyer and market and what problem you are solving for them. Typically, the venture capital employed at this stage is called “pre-seed funding,” which is often sourced from your friends and family. These people are investing in your company largely because of you—who you are to them and what they believe you can do with their investment when given a chance. Often, your closest friend and initial investor is yourself—this is called “bootstrapping” and is simply using your own money to start up your own company. An extremely limited number of “pre seed” organized funds also make initial investments at this stage, many of which are tied to local economic development or industry initiatives. In Indiana, you can sometimes start a company with as little as $25,000 in pre-seed capital (though $100,000 is more typical), especially if there is a physical device as part of the product idea. 

The second stage is productization

This is where you take your initial idea, which has been vetted in the ideation stage, and turn it into a “minimum viable product” or MVP. This is the first complete release of your offering, and while it may not have every feature you will ever want, it’s enough to get it in the hands of some pilot users and gather their feedback. You’ll use that feedback to improve the product and build your “go-to-market” strategy to engage and win customers, which you’ll use in the next phase. Typically, the venture capital employed at this stage is called “seed funding”, and often comes what are called “angel investors.” Angels are high-net worth individuals who deploy some of their wealth at this stage for many reasons, the most likely of which is that they are also successful entrepreneurs who want to help new startups take flight. These investments are high risk, and in some ways are like organized gambling, where they bet they are placing is on you and your idea. In Indiana, I’ve seen angel-backed seed funding rounds as small as $200,000, but more typically these are between $500,000 and $1 million, depending on how complicated the MVP is to build and test. 

The third stage is launch

This is where you take the go-to-market strategy you developed in stage two, coupled with the improvements you’ve made to your product through your pilot users, and launch a full-scale plan to attract, win and keep customers. This is where you start to grow your team substantially for the first time, largely by hiring business development representatives, inside sellers, outside sales representatives, marketers and customer success reps, depending on the talent needs of your go-to-market strategy. Typically, the venture capital employed at this stage is called your “A-round,” or the first of what may be many future rounds of venture capital, and it’s often sourced from organized venture funds. 

Venture funds are a unique type of investment vehicle. Unlike angel investors, where individuals make the decisions about what startups to invest in with their own money, venture funds are made up of “limited partners” or LPs who sign over money to the care of a group of “managing partners” who are employed by the fund to scour opportunities, make investments, and manage those investments for the LPs. They are paid management fees for this, and usually a “carry,” which is a share of the profits if any of those investments result in a successful return. Venture capital funds will have a stated focus for their investments, a range for the amount of investment they will make (called a “check size”) and some process for reviewing and scoring potential deals (called a “thesis”). These parameters are typically unwavering, as they are what was used to attract limited partners to invest in the fund, and therefore cannot be changed easily. Sometimes VCs will insist on “leading” a round, which is to say they are responsible for building and executing the deal on behalf of themselves and other investors, and in a deep review of the company’s structure, finances and team, called “due diligence.” 

In Indiana we have a unique organization called Elevate Ventures, which is funded in part by the State of Indiana to make equity investments in startup companies. They are a venture fund, but often work with angel investors and other funds to co-invest in companies at this stage to help them succeed and pull together smaller sources of funding who may not be in position to lead the round. Because of Elevate, “A-Round” investments can often be as small as $500,000 and be made up of multiple smaller investments, but typical launch-stage investments are in the $1 million to $3 million range. 

The final stage is the scale stage. 

This is when you’ve proven your go-to-market strategy works, and you’re seeking funds to scale up the company’s operations to grow its market share and continue to improve the product. This is the primary domain of most later-stage venture capital firms, who like to see success in the marketplace (called “traction”) and financial stability and sales growth that suggest that the company might be able to make a profit (called a “pathway to breakeven”). Each venture capital round at this stage will be labeled the “B-Round,” the “C-Round” and so on, and can grow in size from $2 million to $10 million or more, until the company has reached a scale where venture capital is no longer required to fuel growth initiatives. 

Venture capital in all its forms is the oxygen that makes technology businesses live. Success in raising venture capital is largely tied to clear objectives as to how the money will be used to advance the company to the next stage. It’s a necessary part of growing a company faster than normal business cycles would, because technology rapidly becomes obsolete. It’s effectively a “growth hormone” and like any medicine, it should be taken as directed by an educated patient.

Read more on the TechPoint Index.

2020 Innovation Issue: Design thinking puts users at center of development

An entrepreneur walked into John McDonald’s office in late April with an idea that could transform the process of buying and selling a home. He had drafted a chart that laid out his plan, and now he needed an app and a website to make his vision a reality.

“The problem,” said McDonald, whose new Next Studios in Fishers just launched to try to turn ideas into products and products into companies, “is that at no point did he ask any Realtors, any homebuyers, any home sellers for their input.”

“If he continues to go down the pathway of developing this service, he might be right,” he said. “Or he might be wrong. In which case, he’s going to suffer a catastrophic failure in his business model because he failed to, at the very beginning, pressure-test the idea with actual victors or victims.”

So McDonald and his colleagues will be doing that pressure-testing with the entrepreneur using design thinking, the name for a particular way of approaching problems and situations to come up with solutions or products.

They’ll start with a session to gather input from potential users about his idea. That will yield information about their target persona—here’s whom they’re after and why—and they’ll use those findings to shape the rest of the process.

From there, McDonald and company might put the entrepreneur’s home-selling plan through as many as 14 exercises to test its viability. The purpose is to figure out how best to make the product faster, better, easier, more fun—and, therefore, improve the user’s life.

That’s design thinking.

“This user-centric view has always been part of what I’ve been trying to do,” said McDonald, who founded and later sold the internet-of-things firm ClearObject. “Only recently have I discovered that it had a name and a process.”

What is design thinking?

Design thinking has been around since at least the 1960s. Sometimes it’s called “human-centered” or “customer-centered” or “user-centered” design. Initially, its focus was in areas such as architecture, graphic design and industrial design, to produce physical products.

Today, said Erik Stolterman Bergqvist, professor of informatics and senior executive associate dean at Indiana University’s Luddy School of Informatics, Computing and Engineering, design thinking is used nearly everywhere. In education to design classes. In service design. Legal design. Policy design.

“In many of these areas, people have never seen themselves as designers,” said Bergqvist, who has been teaching design for 35 years and has written or edited five books on design thinking and related topics.

Designers, he said, are good at getting to the core of an issue. If someone approaches a designer and says, “We have this problem and we want you to help us,” a good designer asks, “Are you sure that’s the problem?” They think creatively, openly and they also think in terms of the outcome—what are the consumers trying to achieve?

“The whole idea with this design-thinking movement,” Bergqvist said, “is that, when you change your mindset and you start to see yourself as a designer and you start to be aware of the possible approaches and methods and techniques that designers are good at using, things happen. You will now be able to do different things and you can do it in ways that lead to new and different results.”

Click above for a step-by-step break down of the design thinking approach.

Practitioners of design thinking say it’s transformative.

Reuben Zielinski is co-founder of Carmel-based Redux, which developed technology to remove water from cellphones and other small electronic devices. He said the design-thinking process helps him sort through ideas in a logical way.

“By labeling it ‘design thinking,’ I use it as kind of a gut check of, ‘Are we skipping any steps here?’ If we start putting a design together and say, ‘Wait, we skipped the research part here,’ or, ‘This is taking too much effort if we haven’t proven there’s an opportunity yet,’ it allows us to back up,” he said.

“And whether it’s a questionnaire or anecdotal information or reviewing data we have from our existing users, it’s been a great way to make sure we’re not skipping any steps.”

Without the process, Zielinski said, “It’s easy to get excited about something and say, ‘Let’s order it and figure it out.’ We’ve proven time and time again, you keep following the steps.”

Redux’s latest invention, the Gen CM, a hearing-aid dryer, came to be because now-director of audiology sales Matt Hay’s hearing aid got wet during a ski trip to Michigan.

From the time Zielinski was presented with the problem, it took four months to talk to consumers and audiologists about what they wanted from the product and then design and redesign a smaller, faster, better box that can dry a hearing aid in 12 minutes—less time than the typical appointment with an audiologist.

Redux started working on the hearing-aid dryer at the end of last year. If all goes as planned, it will be on the market in mid-June.

More than products

Design thinking is in use in a wide variety of firms across the Indianapolis area—and in a variety of projects. SmallBox, a marketing agency that focuses on strategy, web and brand experiences for mission-driven organizations, helped a large not-for-profit figure out how its different state associations and worldwide organization could best complement one another’s work.

Design director Sarah Herbert said SmallBox took the organization’s leaders through a two-day experience using design-thinking processes, which start by empathizing with the customer.

“We always start conversations talking about who it is we’re solving for and thinking of ideas for how we can begin to include them as co-creators in the process,” she said.

From there, the strategy was to frame the challenges and opportunities to create a difference in the customers’ current experiences, come up with ideas about how to implement changes, build prototypes of the ideas and test which ideas are best. In the final step, participants were given Monopoly money to fund the best idea.

“When you attach money to it, people really pay attention,” Herbert said.

The result was three ideas the organization is now exploring.

DORIS employees Stephany Stamatis, left, and Lian Ottinger practice interviewing using a method that involves sticks and cups to measure satisfaction about topics that are written on the sticks. (Photo courtesy of DORIS Research)

DORIS (an acronym for Design Oriented Research for Impactful Solutions) is a firm that uses design thinking to help companies rethink their workspaces. The firm consulted with a west-side food manufacturer to reconfigure its workspace to help make its employees more comfortable. The workers, called bakers, had a hard time at break times and lunch times with crowding and other concerns. Restrooms were too far away, and locker rooms were inadequate.

DORIS founder Samantha Julka and her colleagues went through an eight-step design-thinking process that prompted management to change the physical layout of the facility.

“It’s designed the way the employees thought it should be,” Julka said. “And once they reopened, they have outperformed month over month. Every month, they produce more. The inclusion of the bakers has paid off for them. They’re more productive and effective.”

KSM Consulting, which solves challenges in technology, data analytics and management consulting, worked with high school seniors in a large suburban school district to think through the projects designed for an innovation class.

KSMC took the students through a five-step process designed to think about the right way to solve problems, to understand how our minds process the world and problems they encounter, and to know how to separate traditional thinking from innovative solutions.

“Most of us have a real hard time being innovative in day-to-day life and tend to approach problems in traditional ways,” CEO Mark Caswell said. “Design thinking gives you a framework and a language and a way to talk about it, and it allows you to give your entire organization a way of doing things.”

Caswell’s advice: “The best way to learn design thinking is to just do design thinking. Just try it. You can’t mess it up. And even if you mess it up, that’s all part of the process, anyway.”•

We need to turn around entrepreneurism in Indiana

The Indiana Chamber of Commerce released “Indiana Vision 2025” in 2012, born of a statewide task force of leaders, and recently updated it with a progress “report card.” Our numbers concerning entrepreneurism come directly from the Kauffman Foundation.

The update is not good. As the report card notes, “The overall Kauffman ranking for new entrepreneurs declines once again—with Indiana’s rank falling from 44th to 47th.” Indiana is now nearly last in America in entrepreneurism and also 47th in total employment in firms less than 5 years old—better known as startups. We’re not doing enough to encourage entrepreneurism and startups here, and it is getting worse.

Why does it matter? Kauffman notes that it is startups that create all net new job growth. On average, there are roughly the same number of jobs available in established companies today as there were in 1977, as jobs are created at roughly the same rate others are destroyed. But startups have no gross job destruction—they only create. No startups, no net new jobs.

Availability of venture capital is certainly one of the reasons for our troubles. Kauffman reveals that less than 2% of all startup financing went to women founders, 1% went to African American and Latino founders, and less than 1% went to rural areas. Worse, in 2016, 78% of all venture capital went to just three states: New York, Massachusetts and California.

But that’s not a complete answer. Bill Gross, founder of Venture Studio Idealab, did research on the reasons startups fail to take flight. Surprisingly, lack of funding was the least likely problem, accounting for only 14% of the difference between success and failure. The most common reason was timing (42%), including a bad launch, insufficient market demand or a failed expansion. The second most common reason was the team (32%), including lack of skills or passion, or disharmony.

The shocking thing is that these problems are completely preventable. All of my fellow entrepreneurs can tell you stories about failing to listen to customers, the bad hires they made, or missing the market with their initial product.

We need far more mentorship and guidance for startups. Wouldn’t it be great if all of our state’s experienced entrepreneurs would take budding leaders under their wing and help them avoid the avoidable? Maybe that would begin to turn around a key metric for Indiana’s future that’s going the wrong way.

I asked the researchers from our Indiana Chamber Foundation how many startup jobs we’d need to add to go from 47th to 46th. The answer is 5,977. Just a little less than 6,000 new jobs and we’d move the needle. To get to the middle of the pack, or 25th, we’d have to add 58,171. Top 10? Just a little less than 100,000.

A big hill to climb, but, just like putting together a vision for our state for 2025 way back in 2012 was ambitious, I think this should be our goal: 100,000 new startup jobs by 2030.

Read more in the Indianapolis Business Journal.

Pay Attention to 16 Tech

I just returned from a tour of 16 Tech near downtown Indianapolis, and I can tell you that this is a project that all of us should start paying a lot more attention to.

Tracing its roots all the way back to 2011, the development is nestled into the corner of where Fall Creek meets the White River, northwest of downtown and to the north of the IU Health, Riley, Eskenazi and VA hospital complex at IUPUI. It’s bordered on the north by West 16th Street, from which it gets its name, and the main gateway today is Indiana Avenue as it crosses over the canal towards the Northwest, though one of the project’s signature features is a new bridge over Fall Creek which will extend Wilson Street north from the Riley hospital entrance to the heart of the district.

The project got a significant boost in 2015 when the City of Indianapolis agreed to provide $75 million in tax increment financing to improve roads and reroute underground sewers and water supplies, a significant challenge as much of the southwest corner of the project was formerly the headquarters of Citizen’s Water. The beautiful neoclassical Riverside Pumping Station still stands as an above ground reminder of the complex works below.

The second major boost came in 2018 with a $38 million grant from the Lilly Endowment to fund the initial phase of development. That was key to developer Browning investing $120 million to construct three new buildings and renovate the old Citizens Water headquarters into a “maker space” for startups and more.

Those projects are well underway right now, and the results are already amazing. The most obvious development is “Building One” which topped out on July 11 of last year and was the focus of the “dusty boots” tour I took led by the energetic and delightful Bob Coy. He excitedly described to us the impending move of the units of the Central Indiana Corporate Partnership to the facility, including TechPoint, which serves my industry, as well as the relocation of the Indiana Biosciences Research Institute, the first organization to take root at the site back in 2012.

Speaking of other things we should all be paying more attention to, Bob was recruited from Cincinnati where he led the creation of CincyTech. Way back in 2001, civic leaders in Southwest Ohio realized that their future would be dependent on economic growth through technology, and in 2005, through engagement with entrepreneurs, venture capitalists, business and civic leaders and angel investors, determined that their startups were having trouble raising more than $750,000 in seed stage funding, knowing full well that $2 million is the more likely amount needed for success. One of the problems they also noted was the lack of availability of serial entrepreneurs.

What Bob and his team did was aggregate a fund-service model. They started with a grant from the Ohio Third Frontier, an organization not very dissimilar to our own Next Level Fund here in Indiana, which they used for operating expenses to form the team. Next, they aggregated investors from the private sector, first into CincyTech Fund I in 2007 at $10.4 million, which consisted of fairly small initial investments matched by the State of Ohio. They reopened the fund for investment in 2011 and gathered an additional $4.4 million, and then launched a 3rd effort in 2013 netting an additional $11.2 million. Boosted by a fantastic investment in one of their companies by Sequoia, a large, well-known VC marking their first-ever investment in Ohio, they were able to close a $30 million fund in March 2016, creating over $50 million in aggregate capital as a base for building a tech ecosystem.

Cleverly, they employed a co-invest model where the Fund would generally supply $500k into a deal, and work to bring other co-investors off the sidelines and into the project to build up to the $2M needed for a successful “A-round”. That made the fund a force-multiplier in bringing high net worth individuals off the sidelines and into the tech economy. Indiana desperately needs the same system.

Cincinnati’s loss is our gain, as Bob’s knowledge and experience is exactly what is needed right now. With his leadership and the support of multiple civic visionaries, 16 Tech has fought through countless “brownfield” challenges, and is about to prove the naysayers wrong by moving into a gleaming building which represents more than another technology project – it represents the spirit of Indiana entrepreneurialism leading the way into the future.

Read more at Inside Indiana Business.

Indiana’s future in delivery is delivering

This November, the Indiana Technology and Innovation Association released its 2020 legislative agenda.

In it, the group detailed its support for widespread broadband access and smart technology products and services that would move the state and our cities toward “smart city” status. Increased broadband access in particular would help expand the capabilities and applications of the internet of things as well as the use of smart technology.

Fiscally, with greater connectivity, entrepreneurs would be better equipped to ideate and develop IoT projects that could benefit the state as a whole. In fact, smart cities are projected to add nearly $30 trillion to the world economy by 2025 and up to $11.1 trillion annually.

When I was shopping for holiday gifts this year, I was reminded of ITIA’s goal for building “Smart Indiana,” specifically the role logistics and transportation play in the retail ecosystem. Like millions of shoppers, I purchased all of my holiday gifts online—I never once stepped into a store—and I thought about the trust we place in a retailer’s supply chain to fulfill and ship our orders. Yes, we choose delivery methods and track our shipments, but as consumers, we actually have little control over the delivery process. All we can do is hope our packages are delivered in time.

Especially this year, the heightened popularity of e-commerce and a shortened shopping season have increased demand for next- or same-day shipping. And it’s clearer than ever that autonomous vehicles and things like IoT-enabled delivery solutions would be viable solutions.

As we’ve observed in the past few months, from the chaotic logistics aftermath following China’s Singles’ Day to the recent news of Celadon Group suddenly shutting down its operations, the trajectory a package takes once a consumer hits “order” has the power to drastically affect the bottom line.

Nationwide, Indiana has the most pass-through interstates and is the only state with a port system that gives waterway access to two coasts. This positions our state more strongly than any other to lead the shipping industry, specifically last-mile delivery. This infrastructure makes Indiana a top candidate for autonomous technology deployment.

I mentioned ITIA’s support for broadband access and smart technology because these two things lay the foundation Indiana needs for an initiative of this magnitude. Across the state, entrepreneurs would get the tools they need to develop new products and services for last-mile delivery and solidify Indiana’s position as a transportation and logistics leader.

Proof that we’re already moving in the right direction are Purdue’s food delivery robots and PerceptIn’s decision to move its global headquarters to Fishers. In PerceptIn’s case, the visual intelligence technology company is set to also partner with the city of Fishers to develop short distance, self-driving shuttles for the community. These two developments signal a tremendous economic opportunity for Indiana.

Moreover, Purdue and PerceptIn are shining examples of autonomous “last-mile” technology, or machine learning solutions that can facilitate the last step in a shipment’s journey. In the transportation and logistics industries, last-mile delivery is the final critical step to a positive customer experience.

For example, all those holiday gifts I purchased are now “out for delivery,” but realistically it could be hours before the tracking number shows a completed delivery. As consumers increase their shipping expectations, the last mile becomes more problematic.

Someday, not too far in the future, I’ll order my holiday gifts and know the precise day and time to expect delivery. At home, a robot would exit an autonomous delivery truck, greet me by name and neatly stack my packages at the front door. Maybe I’ll add that scenario to my wish list next year.

Read more in the Indianapolis Business Journal.

The Red Line—a future success or missed opportunity?

When the Red Line transit route officially launched Sept. 1, more than 63,000 hopped on board the first week. Since then, the transit line has averaged about 7,000 riders a day, or roughly 14,000 fewer than that initial week. Ridership did increase in September by 30%. Still, IndyGo remains in the planning stages for its Purple and Blue Line transit systems to connect even more residents within the circle city.

I fully support these changes to improve public transportation in and around Indianapolis and its surrounding areas. But I also can’t help but wonder if we’re missing the mark to advance our transit system in a more technologically savvy and sustainable way.

The public transportation industry is moving toward self-driving and autonomous capabilities at a rapid pace, and I’m apprehensive that these new transit lines will quickly become outmoded.

In February, for instance, the artificial intelligence company May Mobility, a Midwest-based company, received $22 million to fund nationwide expansion of its self-driving public shuttles. The shuttles are already operating in Columbus, Ohio; Detroit; and Grand Rapids, Michigan. Also in 2019, domestic and foreign automakers equipped well over 200 of their vehicle models with semi-autonomous capabilities called advanced driver assistance systems. And by 2021, a key goal for the Ford Motor Co. is to include a truly self-driving experience that requires no gas pedal or steering wheel.

For self-driving and autonomous public transit, May Mobility is well on its way. Are automakers next? They easily could be.

While the Indy community is largely excited about the Red Line, its launch has been a bit bumpy. Riders have reported waiting more than 30 minutes for a bus scheduled to arrive every 10-15 minutes. It’s been further reported that IndyGo doesn’t have enough drivers to staff the Red Line buses needed to stay on schedule.

As the city of Indianapolis looks to solve transportation issues for the 8.8 million people who use IndyGo transit services every year, I encourage leaders to adopt more forward-thinking, sustainable solutions that promote the Midwest tech hub environment we’ve worked so hard to create. The benefits of deploying self-driving and autonomous vehicles alongside traditional means of public transportation shouldn’t be understated.

First, autonomous and self-driving solutions could ease IndyGo’s driver shortage and help ensure departure and arrival schedules. Aside from a lack of drivers in the first place, self-driving buses could compensate for typical human driver challenges—vacations, being out sick, or not having enough resources for something like the Indy 500 or the Super Bowl. IndyGo could even train remaining employees in associated technologies such as programming (for autonomous purposes) or control room monitoring.

Furthermore, as they already are in the trucking and automotive industries, autonomous transit solutions could potentially help reduce cost and human error. From sensors to monitor and report driver behavior, to algorithms foreseeing maintenance and mechanical problems before a bus becomes unsafe or inoperable, these kinds of smart solutions could measurably reduce liability and insurance costs.

Fixed-route shuttles would provide another benefit by bridging longer distances between bus stops in underserved areas that rely heavily on the city’s public transit system. Small, six- to 12-person shuttles could serve individuals with disabilities and people commuting from retirement communities or health care facilities.

Indiana has spent years focusing on our strengths to become a technology hub nationally, and the city’s transit system is one more way we can lead by example. Already, the mass transit industry has begun its move toward autonomous and self-driving vehicles, buses and shuttles to improve ridership and reliability of public transit. The Red Line could easily, and quickly, become outdated if we don’t make the same move.

Read more in the Indianapolis Business Journal.

Let’s change our frame of mind about college degrees

I’d like to invite you to look at the world slightly differently.

You’ve been told that, if your children don’t attend a four-year college and get a degree, indebting them by $29,000 or more (the average in Indiana), you or they are somehow a “loser.”

That’s a lie.

Bill Gates from Microsoft, Michael Dell from Dell Computer and Steve Jobs from Apple. None of them earned a college degree.

They are not alone. Famous founders Jan Koum (WhatsApp), Travis Kalanick (Uber), both Dustin Moskovitz and Mark Zuckerberg (Facebook), both Evan Williams and Jack Dorsey (Twitter), and even Hiroshi Yamauchi—who transformed Nintendo from a card-making company into a video game giant—don’t have college degrees, either. A college degree never was and still isn’t required to be a technologist.

There are many professions where a college degree is really needed (doctors, lawyers, etc.). And, I can’t think of a single profession that isn’t enhanced by a college degree. But to require it? Not in my line of work. Software development, cybersecurity—indeed a whole range of job roles in technology—are now more like technical trades than they are degree programs, something like the plumbers and electricians of the digital economy.

As parents, we need to demand of our high schools that all the pathways to success are arrayed in front of our children, especially technical trades.

Look to Eleven Fifty Academy, driven by technology pioneer Scott Jones, as a fast and low-cost way to a paying job in coding or cybersecurity. Look to Kenzie Academy, led by repatriated Hoosier Chok Ooi, as a way into the tech industry by financing your skills through a rebate to the academy after you’ve landed a job at a high salary through the program that helped you get there.

Look to innovators like Kevin Berkopes at Crossroads Education, innovators who are changing how companies get access to skills like machine learning through employing students to tackle the meatiest analytics problems of our age. Look to Don Wettrick at the StartEdUp Foundation, who has taught many waves of students how to survive and thrive in the economy of personal initiative, where everyone is an entrepreneur. Look to Mike Langellier and the team at TechPoint, who are recruiting and placing high school students in important internship roles across our state to drive technology forward.

Change has come even to our traditional universities. Look to fantastic programs like the Cybersecurity Academy offered by Ivy Tech Community College Columbus at the Muscatatuck Urban Warfare Center. Look to Bryan Ritchie at the IDEA Center at the University of Notre Dame for how Hoosier students can be enabled to take their ideas to market. Look to Purdue Polytechnic, enabled by Head of School Scott Bess, Dean Gary Bertoline and President Mitch Daniels, who are renovating the idea of a technology education by opening their program to self-direction—to involvement with companies like mine, ClearObject, to directly hire and engage students.

These efforts not only are the future of technology education, but also will ensure that Indiana businesses survive and thrive in the digital economy. These people “get it.”

I realize these words are challenging and threatening to the status quo. But our children know already that the skills they are being taught are no longer relevant for the digital economy. Skills of the future are learned on demand, in the context of students’ daily lives, and applied directly to “moving the needle” at organizations that can connect their abilities to customer needs without delay.

We can become a “brain engine” that fuels the future of our state, the Midwest and our country. But we must shed the idea that the only way to succeed is a four-year degree and return to placing value on technical trade education as a valid, parallel, even preferred career path.

Read more in the Indianapolis Business Journal.

Data centers are Indiana’s new factories

At the start of the new millennium, no one would have guessed that the manufacturing-centric state of Indiana would evolve to become a Midwestern tech giant. But it has. Overall, the technology sector accounted for about one-third of our state’s new job commitments from mid-2017 through July of 2018, beating out all other industries.

This shift is rooted in rapid technological advancement worldwide and an industry that’s continuing to be disrupted at warp speed. With more than 175 zettabytes of data expected globally by 2025, data centers will continue to play a vital role in the ingestion, computation, storage and management of information. Therefore, the development of hyperscale data centers in as many locations as possible is the obvious (and ongoing) next step.

In Indiana especially, such data centers are vital to building upon our growing tech sector and sustaining the sector’s momentum over the next several years.

To that end, progress came when Gov. Eric Holcomb signed a bill at the end of June this year providing tax incentives to organizations choosing to build sizable data centers in Indiana. The new law provides exemptions from the state’s sales tax for items including equipment, electricity, construction and build-out for up to 50 years.

These incentives are already gaining traction. Digital Crossroads in Hammond is just one company jumping on board to furnish a lakefront data center in the former State Line Generating Plant on Lake Michigan shores. Going forward, in promoting Indiana as a new kind of technological and industrial crossroads, the state’s incentives are expected to attract other companies looking for similar data center locations.

Another clever idea is repurposing old space. Lifeline Data Centers chose to overhaul the former Eastgate Mall, because along with the facility’s ample space, Lifeline’s CEO cited its central location and our exceptional cost of living as primary factors for choosing Indianapolis for the company’s growth. Data Realty in South Bend built a gleaming new data center on the grounds of the old Studebaker Factory, lifting what was once a brownfield into the digital age.

Why is this so important that we should all want our tax dollars used to incent it? It’s because data centers are the factories of the digital economy. As Indiana’s economy shifts away from parts made in our plants, products moved on our pavement and food grown in our fields, data centers are the new factories, 5G networks are the new roads and schools are the new field where brainpower is grown.

Economically, a CBRE study concluded that—based on a typical state and municipality tax structure, as well as economic and demographic characteristics—a $1 billion data center could generate upward of $200 million in tax revenue over 10 years, including construction and ongoing operations. That’s an impact equivalent to a corporate headquarters creating 1,700 jobs with a $130,000 average salary and making a $40 million capital investment.

Case in point, at least for Google. In February, the company announced its $13 billion investment plan for new data centers in Ohio, Nebraska, Nevada and Texas. The plan also includes the expansions of existing centers in Oklahoma and South Carolina. The jobs count is anticipated to be tens of thousands of new employees.

So why not Indiana? Attracting new data center operations is now just as critical to spurring economic development as attracting a new factory was to the previous generation—a true measure of our dedication to advancing technology.

Read more in the Indianapolis Business Journal.