Do you want to fail?

How to engage startups in sensible projects, like governmental ones, where risk is not to be taken lightly? And what does that have to do with creating a Silicon Valley in the Alpine regions?
The Executive School visited the Swiss-Austria-Liechtenstein Chamber of Commerce to find out.

When you are into the digital transformation discussion you heard all that already:

Fail cheap, fail fast.
New types of jobs will make half the market of the future.
Lead the change, don’t get led by it.
Be excellent, not average.
Co-working spaces and lack of hierarchy good. Old school style of working bad.

What gets forgotten is who is paying for all that cheap failing, excellency search and the co-working spaces. Especially because if you fail a lot, costs tend to amount. And sometimes you cannot afford to fail at all, especially if a big investor or agency expects something from you. Now the problem is clear: everybody wants innovation so we all need to take on some risk. Who is to bear this risk? The private investors and startups? The government?

This hot topic had quite interesting answers during a panel from the Innovation Unplugged at the Swiss-Austria-Liechtenstein Chamber of Commerce. The panel discussed what is necessary to create an “Alpen Silicon Valley”? What are the main challenges? Does the stability-loving Swiss culture lead to a lack of support for (risky) start-ups?

While panelists brought a lot of the cliches above during their presentations, there was some scrutinizing these. Netcetera‘s CEO Andrej Vckovski questions all that talk about failure being cool, because at the end of the day startups and their supporters want to be successful and sometimes this means hitting walls but not giving up. In his opinion helping them have access to markets and cash flow, as opposed to plain credit, would do a better job supporting them. Instead of it, tendering law makes it too easy for startups to be excluded from business possibilities. Adrian Hasler, prime minister of Liechtenstein, agreed that it is important for politicians to recognize the need for flexibility and speed when dealing with these issues, as both the law as well as politics tend to be way to slow and fearful about innovation.

Nicolas Burer from Digital Swizerland commented that states tend to not want to support innovation so directly, instead focusing on education and other long term strategies or by encouraging incubator projects and other of the above mentioned credit based solutions. Sybille Kammer-Keller from Zühlke agreed that, by seeing startups as plants in a greenhouse, incubated, one puts a wall around them, a transparent one but a wall none-the-less.

Apart from these external factors, there are also internal factors to startup and innovation fostering. One of them being the new ways of collaborating, hierarchy and barrier free communication among the foremost examples. Andrej Vckovski once again questions one of these gives, arguing that ready-made co-working spaces may hinder the entrepreneurial spirit, as “going on a Saturday to buy your tables for your new enterprise is part of being an entrepreneur, of having this groove necessary for success”. His words indicate a belief that even the small aspects of business making are key factors to separate the ones with the willpower from the ones that are just playing being business people.

The highlight of the panel in my opinion was the interesting idea of a “startup insurance fund”. Urs Weber, general secretary of the Chamber of Commerce, mentioned that if the risk of engaging startups could be calculated and insured, it would be easier for the free markets but also for governmental institutions to be open to trying working with them. A fascinating concept and one which is still quite green. I wonder if (re-)insurance companies would be looking at a potential market here?

 

Photo by Markus Spiske on Unsplash

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