Innovation, Startups, Impact  and Bullshit Bingo

Labels are a necessary evil in our modern language. In an age of short attention spans fueled by dopamine-addled social media-overloaded brains, labels and three word slogans are applied to pretty much everything..far from ideal.

Martina Navratilova says ‘Labels are for filing. Labels are not for people’. Kierkegaard points out that: ‘Once you label something you negate it’.

On the other hand, much like metaphors – labels are an important way in which we can communicate concepts with other people quickly, when there’s no time to describe, contextualise, and define. Unfortunately, labels can be taken out of context, and some of the labels we throw around are really starting to twist and confuse conversations and themes.

We create new language at a rate of knots in this rapidly evolving digital world, and existing language – by dictionary definition – changes over time, but in this rapid evolution, it can sometimes help if we S L O W … T H I N G S … D O W N and be a bit more thoughtful and deliberate about the labels and language we use.

While we have to keep using and adapting LABELS to communicate effectively with each other, we also need to be more thoughtful, deliberate and sometimes slower and more methodical about how we communicate themes and concepts, and really take the time to understand each other – in spite of this age of sensory and information overload, where everything has to be a label, a soundbite, three word slogan or elevator pitch.

If we rely on these too heavily it just contributes to the collective dumbing down that Carl Sagan predicted so eloquently (and with frightening accuracy) back in 1995:

With that grand foreboding as a backdrop, here’s something much smaller and relatively insignificant that’s occurring in my corner of the world of ‘systems change finance and entrepreneurship’..

Reflecting on my journey through the impact and innovation space often has me thinking about the labelling quagmires from my little corner of focus. Our journey of augmenting the conversation in the startup and investment space in Western Australia revolves around ‘social enterprise’, ‘impact investment’, social innovation’, ‘profit for purpose’.. or whatever ‘LABEL’ we invariably (and reluctantly) have to pick for these ventures according to the audience; But more broadly in the innovation and startup space, labels can be a minefield. Here are a few examples of labels out of control:

Label Bullshit Bingo

STARTUP: The label ‘startup’ most often describes tech startups. Not every startup is a tech startup. Most startups have a tech component, even if it’s just online ordering; But, when we have government or private funding, put together startup reports, or profile startups, let’s see all the startups represented, including the bricks and mortar ones, the product ones, the people-intensive ones, and the social ones. Let’s include all startups, or be deliberate and label startups with appropriate nuance and qualifiers – for the sake of clarity and mutual understanding.

UNICORN: What’s this fascination with unicorns that has spawned an entire global startup industry made up of prospective unicorns and an entourage of unicorn hunters and farmers. Are we flogging every horse and mule to be a unicorn? Not every investible startup has to…

..SCALE AND EXIT: Not every startup needs capacity to globally scale to be investible, or an IPO, trade sale or exit to Silicon Valley to be deemed “successful”. Unicorns aren’t the only creatures to deliver outstanding multiples of returns. Mules can carry massive payloads, and horses can be champion winners: You can – with very little seed money, good timing, and some cashflow support along the way, start a small business and turn it into a $10M, $50M or $100M business within a few years, with a lot of persistent effort, hard work, adaptiveness and resilience. Common startup labels do these non-unicorns a great disservice

INNOVATION: I’ve blogged about this before. We have a reality gap and cognitive dissonance as an ecosystem when we define innovation as technology. There are many forms of innovation. 

When we want to say corporate innovation or tech innovation (or fintech, medtech, agtech etc), let’s call it that, and when it’s social innovation in its numerous forms, let it be that, and use extra language for context and understanding. 

And when we say the royal ‘innovation’ (eg. when it’s a ‘government innovation fund’) let’s embrace ALL THE NUANCED FORMS OF INNOVATION.

All innovation impacts on the community that we live in and the kind of community that we want to live in. Three word slogans are not helpful.

This innovation bullshit bingo below is for real..remember Prime Minister Malcolm Turnbull’s  ideas and innovation boom?

DEFENSIBILITY: The much touted ‘defensibility’ asked by investors is usually proxy for ‘patent’. Yet patents are thin on the ground amongst the plethora of startups. Many of those that are already funded have no patent to speak of, and never will. Defensibility is super important to be sure, but let’s not kid ourselves that not-patentable=not-defensible. These patent-less startups that are funded are still relying on the old unique business model + team capability + speed to market formula as their main defence, and that shouldn’t be underrated. I love nothing more than someone that sees a gap in the market and just goes to fill it and keeps killing it, and leading (or even eking out market share) even as competitors multiply.

ACCELERATOR: This one was coined by the ecosystem itself. There are tonnes of accelerators across the country, some are great for building networks, mentors, investor connections, MVP articulation and pitch building, and a small precious handful teach vitally important holistic business building skills. Unfortunately the ‘accelerator’ label is plastered on all of them, and is sometimes applied by the marketing departments of companies that sponsor an ‘accelerator’ program, because ‘accelerator’ (like ‘innovation’) is a sexy word. But, caveat emptor.. not all accelerators are the same, so maybe we can nuance or use more effective language to define and distinguish accelerators, to avoid unsuspecting founders ‘accelerator-hopping’ thinking they’ll get something different at the next one, only to find afterwards that they have a telephone book of shareholders agreements and convertible notes at the end that leaves them hog-tied for future deal making.

ENTREPRENEUR: The dictionary definition is not my friend here, and I reckon this is my problem to get over, but common-use has created a dichotomy. Richard Branson is an entrepreneur. Steve Jobs et al. Although language is constantly evolving, maybe we can be humble enough not to label everyone that quit their job to start a home business which might be massive one day as an ‘entrepreneur’. Unless we can come up with an even bigger, newer label for Richard Branson, maybe we can take a ‘label pay-cut’ and let his ilk have ‘entrepreneur’. I’m sure he’s happy to share, and I’m all for creating your own reality and the power of positive belief, but I like and use “founder”.

Finally.. the old chestnut:

SOCIAL ENTERPRISE/IMPACT INVESTMENT: While “social enterprise” in the US and Asia is generally understood to be ‘for profit’, here in Australia we have this odd cultural cringe that all social enterprise is charity, and dare not use the term in any investor discussion or pitch. Good grief!

Traditional investors have traditionally seen the label ‘social enterprise’ dominated by NFP’s, so the moment they see that label, the alarm bells go off: “not commercially viable”.

On the other hand, for profit mission led businesses are often lambasted by the deep-social brigade that they are only in it for the money and any of their social impact attempts are tokenistic or greenwashing.

IMPACT AND PURPOSE is the emerging bullshit label in the business and investment world that is open to marketing pillage and exploitation just like so many things that came before it, but to separate truth from fiction we always have to go deeper than labels, and to intent, inspiration, and the motive driving the organisations using these labels. We have to slow down to in order to do this, and that’s not always compatible with the “frictionless” transaction world we live in where profit and growth still reign supreme.

The wrap

Someone very different to me but who I love to bits – my partner in work and life, Kylie Hansen, has been onto labels running second to intent and content for a long time, but my business growth and marketing background tells me labels remain a currency, made up as they are.

Ultimately, if we can reconcile the two better by slowing down, listening, and having more meaningful engagements, partnerships and conversations we can dispense with bullshit labels and reach a better place of common purpose and mutual understanding; Building a new economy and community we all feel a belonging and and energy in. One where startups, innovation and investment mean something to many more people, and where the processes and structures that surround them don’t just perpetuate more of the same old..