CivicStart co-founders Nick Lyell, Anthony Jamison, Sarah Kerner
CivStart is a new government-focused start-up accelerator that wants to ensure civic technology products “don’t get made in a vacuum — that they serve the needs of our most vulnerable and underserved communities.”
Co-founders Nick Lyell, Anthony Jamison and Sarah Kerner share their mission, and why they started CivStart.
What problem does CivStart want to solve?
In short, local and state governments are responsible for serving their communities in ways that have significant impacts on people’s lives, but have not always tapped into the best resources to do so. CivStart wants to help governments innovate their processes and tools by connecting them to effective new solutions.
We look at what we are solving from two different viewpoints, based on our audience; state and local government leaders and startups.
There are a couple issues we are addressing here at CivStart:
Identifying startup technologies that are providing solutions which address the challenges and issues state and local governments face on a day to day basis as they plan for the future. Whether that is understanding where your vulnerable populations are during a disaster so that you can deploy assets strategically or providing affordable transportation options to your communities so that they don’t have to take multiple bus lines. Our goal is to find these technologies and offer them to government leaders so that they can ensure that their communities are healthy, secure and vibrant.
Helping startups scale and enter the market the right way. We understand that startups have a mandate to grow and to grow fast (as we are startup ourselves). However, the state and local market is incredibly unique and complex to navigate for many large companies, let alone startups. A lot of business in this sector is won through relationship. Government decision-makers want to know that they can trust you, so selling to state and local requires a different approach than what a lot of these companies are used to when cornering the market. Startups need to know what the pressing issues are, and position their solutions in a way to address those challenges.
What was the inspiration for starting CivStart?
In our experience we’ve noticed:
Governments are often unaware of new technologies available to help them better serve their communities.
Many new companies don’t know how to navigate the public sector market and build relationships with the governments they want to help.
This inspired us to create a nonprofit that works with multiple stakeholders to bring these groups together and solve both issues.
What is CivStart looking for in its participating startups?
Of course, we want the biggest and brightest startups to be apart of our portfolio. However, working in the space that we work in, we can’t just be focused on the next best idea, solution, or service; instead, we seek startups who are solving real state and local problems and that we believe can have a real impact on improving people’s lives.
We try to prioritize our focus on access and opportunity for underserved and unconnected communities through health, public safety & emergency services, transportation & infrastructure workforce development, economic and community development, gender equity, civic tech, digital and financial inclusion ventures. One of our main organizational goals is to have our cohort members promoting gender and racial/ethnic diversity within the tech community.
How is CivStart supporting your portfolio companies?
CivStart helps startups forge meaningful connections with leaders in the public and private sectors to turn compelling technology into viable, scalable, solutions for the state and local space.
Each startup is in our program for 24 months, during which we’ll offer educational programming, facilitated mentorships and advisory relationships, and help cohort members build their networks in strategic ways.
We empower technology entrepreneurs to work with governments towards positive localized social and environmental change.
What does success look like for CivStart?
Success for us in many forms.
The obvious measure of success is the growth rate of our startups. We fail if our startups do not win market share; however, being an honest broker of solutions for state and local governments is also a key indicator of success.
We want governments, and the people that work with them and for them, to know that we are thinking of how we can strategically serve their needs and challenges when we engage with selecting startups technologies. They can come to us knowing that we put these startups through a program that emphasizes treating governments as partners and not just customers.
Koltai, now managing director of Koltai & Co., previously served as senior advisor for entrepreneurship under Secretary of State Hillary Clinton, where he ran the nascent Global Entrepreneurship program. GEP’s mission, and the core of Koltai’s message in “Peace Through Entrepreneurship,” is aimed at creating entrepreneurship ecosystems based on a six pillar framework.
Koltai’s Six+Six Entrepreneurship Ecosystem Model includes identifying entrepreneurs, help get them the training they need to succeed, connect them to all appropriate resources and networks, fund them, enable public policy that supports new ventures, and celebrate their efforts and progress. This model depends of the collective support of governments, investors, academia, foundations, non-governmental organizations and corporations.
Writes Koltai:
“It is only government that has the wherewithal, mandate, and obligation to do entrepreneurship at the large, highly coordinated scale required. It is government that stimulates investment in failing and fragile states, and it is government that can turn sectors safe as a first-in investor. And, most important, it is government that is responsible for the security of its citizens. A government that allows the source of its threats to fester and spread unchecked is negligent, and especially so when a solution to those threats presents itself in the expertise of that government’s citizens. The U.S. government must elevate entrepreneurship as a foreign policy tool.”
Building and selling products to government is hard. If you’re reading this post, I’ll assume you’ve heard the “if we only fixed procurement…” soundbite.
This post isn’t about fixing procurement, procurement is a symptom.
I’ve spent the last eight years building and selling products to governments. At the risk of oversimplifying what works in govtech, I think success comes from three factors:
Founder-product-market fit
Understanding zero-sum budgets
Scale through social proof
Founder-product-market fit
Every sector requires companies to find product-market fit as quickly as possible. There’s not a better post than this one when it comes to the importance of product-market fit. However, government is different. It’s almost impossible to “eat your own dog food” in govtech. You can’t create a QA environment that replicates the planning and zoning counter. The only way to replicate public safety use cases is to be in the field with the folks doing the work. The inability to use-what-you-build puts enormous pressure on the founder(s) to place themselves in the environment and build a product that works.
Understanding zero-sum budgets
City budgets are a zero-sum game. Allocating dollars to a new product simultaneously forces withdrawal from something else in the budget. Your product has to be so good it entirely replaces another product or a human process. There’s a good chance that product or process you’re replacing has been in use for 25+ years. Products can’t be 10% better in government, they have to be 10x better than the incumbent. This might sound like every other sector, but risk aversion is high in government. In order to replace something in the budget, the bar for product viability isn’t minimally-viable.
Scale through social proof
Concentrated impact, either geographic or within a domain, is a common thread in successful govtech companies. To combat the inability to use your own product (highlighted above), the only way to gain understanding and thus scale is through social proof. Random smile and dial doesn’t work in govtech. People forget that selling software to non-IT departments is a new phenomenon. Most of these folks haven’t been sold software, ever. These are domain experts and only experience value through narratives, stories of similar people finding value. In the case of government, similar people means the city next door or another person that does my exact job. The danger in govtech is trying to get scale through the force of a sales operation long before product-market fit exists.
With all of that said, success in govtech is there for the taking.
Adding to the increased interest in investment opportunities around civic and government technology, a new venture fund, Ekistic Ventures, launched with the intent of “building a portfolio of companies that will solve critical urban problems.”
The Ekistic team includes former Chicago chief data officer Brett Goldstein, former Rahm Emmanuel advisor David Spielfogel, former Philadelphia mayor Michael Nutter, O’Reilly Media founder Tim O’Reilly, Anne Milgram, Michael Sacks and Will Colegrove.
We’ve seen a lot of pitches over the years, and we know how good ideas never see the light of day because the entrepreneur or start-up doesn’t understand the market landscape or the realities of succeeding in the urban environment.
Second, in addition to writing a check we also commit our time and networks to build meaningful companies for the long haul. That’s why we only work with a small handful of companies each year, and why we so closely tie our success to the success of our portfolio companies.
Bay Areas cities San Francisco, Oakland, West Sacramento and San Leandro teamed with startups this year as part of the Startup in Residence program to “explore ways to use technology to make government more accountable, efficient and responsive.”
The 2016 cohort included 14 companies that worked with the cities over 16 weeks, and the teams made their presentations Friday (see #STIR2016).
All of the projects were fantastic, but Binti really stood out and opened my eyes to the impact modernized technology can have on truly changing lives.
The STIR program started in 2014 and serves as a model for other geographic regions that want to create momentum around civic technology and scaling government innovation.
Big shout to Jeremy Goldberg, Krista Canellakis, Jay Nath, the SF Office of Civic Innovation, an incredible team of ambassadors and mentors, Monique Woodard from 500 Startups and, of course, Lawrence Grodeska and the CivicMakers team. It’s inspiring to see public sector leaders working proactively with startups to break through the procurement and technology mold and bring better digital services to those they serve.
Y Combinator is looking for a team of people to lead research on how to make cities better, and will use the findings to help determine how to invest in future ventures.
High-level issues the team will address include:
What should a city optimize for?
How should we measure the effectiveness of a city (what are its KPIs)?
What values should (or should not) be embedded in a city’s culture?
How can cities help more of their residents be happy and reach their potential?
How can we encourage a diverse range of people to live and work in the city?
How should citizens guide and participate in government?
How can we make sure a city is constantly evolving and always open to change?
“The world is full of people who aren’t realizing their potential in large part because their cities don’t provide the opportunities and living conditions necessary for success,” writes Y Combinator’s Adora Cheung announcing the effort. “A high leverage way to improve our world is to unleash this massive potential by making better cities.”
icitizen re-launched in January 2016 with a broader goal, to change how we communicate on civic issues, connect with our communities and “promote meaningful change.” icitizen’s Jacel Egan shares the vision for its future.
Give us the 140-character elevator pitch.
icitizen is a nonpartisan app where citizens promote/stay informed on issues and vote in polls sent to policymakers to create change in their communities.
What problem does icitizen solve?
We connect citizens to the information, organizations and elected representatives most relevant to them. Through icitizen, citizens easily promote and stay informed on important issues and vote in polls to create meaningful change.
Anonymous poll results and public opinion data are shared with representatives, organizations, companies and other stakeholders to inform policy. Using representative sampling based on U.S. Census targets, our polling services help policymakers drive sound, data-driven decisions.
We help strengthen community relationships, facilitate open government and support partnerships between policymakers and the people they represent.
What’s the story behind starting icitizen?
icitizen was originally founded in 2012 by Duncan Dashiff out of frustration with our current political process and the disconnect in communication between citizens and elected representatives. We envisioned a nonpartisan civic engagement app where people could find information, be heard and work together with their representatives to create an impact in their communities.
In January 2016, icitizen was relaunched with a broader vision to help citizens, representatives, candidates, organizations, schools and companies strengthen their relationships with their communities and one another.
Our mission is to transform the way people communicate on civic issues, connect with their communities and promote meaningful change.
What are its key features?
Issue Cards are created by citizens, elected representatives, organizations and icitizen. They’re posed in the form of statements and users can cast their support or opposition.
Issue Cards serve two purposes:
1) For citizens to gain support for issues they would like addressed in their community
2) For representatives and organizations to gather sentiment on a specific issue or policy
Straw Polls are created by elected representatives, organizations and icitizen to gain insight into public opinion. They’re posed in the form of questions and intended to gather sentiment from citizens on trending issues or legislative policies.
Rep/Organization Cards are profiles for elected officials, organizations, schools and companies to help them better connect with their communities. On their profiles, they have district rankings, priorities, contact information and more. In future iterations, they’ll also be home to voting records, sponsored bills, committee assignments, etc.
What are the costs, pricing plans?
icitizen will always be free for citizens. We also work with organizations, schools, elected representatives, candidates and companies to help them better connect with their communities. Through our polling services and analytics, they can receive aggregated, anonymized data and demographics on public opinion. We charge based on how detailed or targeted the data request is.
Former Chicago and District of Columbia transportation head Gabe Klein highlights eight lessons leaders should follow when building innovative approaches to better cities in his book “Start-Up City.”
These include accepting failure, managing by metrics, budgeting creatively, always believe there’s a way, focus (aggressively) on marketing, branding and communications, cultivate public-private relationships, plan for external disruption and how to address them when they arise.
He also addresses the importance of regulatory hacking for disruptive entrepreneurial ventures.
Much of the anecdotes are transportation-heavy, leaning on Klein’s background, and at times it reads like a personal pitch for him to be the next U.S. Department of Transportation secretary (he should be), but it’s still a great playbook that encapsulates how to unify a team, change expectations and, as he says, “get sh*t done.”
Key quote:
I have written this book to inspire the next generation of “public entrepreneurship,” a start-up paced energy within the public sector, brought about by leveraging the immense resources at its disposal. At the same time, we need corporate America, and start-up America, to embrace “social enterprise,” working for the common good, as their primary objective versus external shareholder wealth. Combining both of these into “social entrepreneurship” allows us to move beyond public and private silos and focus on using our collective energy to solve the world’s problems, regardless of your vantage point or chosen profession at the moment. To be successful in business in cities today, you need to align your goals and values as much as possible with those of city government and citizens as opposed to with profit alone. Such entrepreneurship has the potential to engender the next level of public-private partnership and give rise to new models of shared financial reward working in the interest of the greater good.
The idea of regulatory hacking — “combining public policy and alternatives to traditional marketing for startups to successfully scale in the next wave of the digital economy” — is important for new companies interested in changing energy, healthcare and especially government itself to understand.
Sonal Chokshi has a terrific a16z podcast interview with Evan Burfield, co-founder and co-CEO of D.C.-based global incubator 1776, that discusses the concept and strategy behind its effective execution.
“Think right now,” says Burfield. “Who’s is the most iconic entrepreneur in Silicon Valley, the one all the kids these days are aspiring to? It’s Elon Musk. Every one of his businesses is based on a regulatory hack.”
The idea, first socialized by Burfield in 2014, is that, in order to be successful, startups must create strategies, either integrative or combative, to deal with regulatory and policy issues. Key examples are Airbnb and Uber.
“At 1776, we believe that regulatory hacking is the best way to disrupt entrenched industries,” and writes co-founder and co-CEO Donna Harris. “Regulatory hacking means using the system to your advantage to drive scale, exerting outside influence on the system by engaging the public, or doing a complete end-around the system to force change from the outside. Fascinatingly, it’s a strategy big companies and trade groups have mastered and expertly used to their advantage for decades.”
We just held our seventh week of the Hacking for Defense class. Now with over 750 interviews of beneficiaries (users, program managers, stakeholders, etc.) almost all the teams are beginning to pivot from their original understanding of their sponsor’s problem and their hypotheses about how to solve them. Minimal viable products are being demo’d to sponsors and sponsors are reacting to what the teams are learning. This week teams figured out how to measure mission achievement and success, and our advanced lectures were on activities, resources and partners.
(This post is a continuation of the series. See all the H4D posts here. Because of the embedded presentations this post is best viewed on the website.)
Why Innovation in Government Is Hard
As we spend more time with the military services, commands and agencies it’s apparent that getting disruptive innovation implemented in the DOD/IC face the same barriers as large corporations (and a few more uniquely theirs.)
The first barrier to innovation is the Horizon 1 leadership conundrum. In corporations, the CEO and executives have risen through the ranks for their skill on executing existing programs/missions. The same is true in most DOD/IC organizations: leadership has been promoted through the ranks for their ability to execute existing programs/missions. By the time they reach the top, they are excellent managers of processes and procedures needed to deliver a consistent and repeatable execution of the current core mission (and typically excellent political players as well.)
These horizon 1 leaders are exactly who you want in place when the status quo prevails – and when competitors / adversaries react as per our playbook.
To these Horizon 1 leader’s, innovation is often considered an extension of what they already do today. In companies this would be product line extensions, more efficient supply chain, new distribution channels. In the DOD/IC innovation is often more technology, more planes, more aircraft carriers, more satellites, etc.
This “more and better” approach works until they meet adversaries – state and non-state – who don’t follow our game plan – adversaries who use asymmetry to offset and degrade our technological or numerical advantages – roadside bombs, cyberattacks, hybrid warfare, anti-access/area denial (A2/AD), etc.
History tells us that what gets you promoted in peacetime causes you to lose in wartime.
When Horizon 1 leaders set up innovation groups the innovators at the bottom of the organization start cheering. Meanwhile the middle of the organization strangles every innovation initiative.
Why? Most often four points of failure occur:
Horizon 1 leaders tend to appoint people who they feel comfortable with – Horizon 1 or perhaps Horizon 2 managers. This results not in innovation, but inInnovation Theater – lots of coffee cups, press releases, incubators and false hopes, but no real disruptive changes. Horizon 3 organizations require Horizon 3 leadership (with Horizon 1 second in command.)
There needs to be effective communication about what being innovative means to different parts of their organizations as well as defining (and enforcing) their expectations for middle management. How do middle mangers know how to make trade-offs between the efficiency requirements of their Horizon 1 activities and the risks required of a Horizon 3 activity?
They have to create incentives for middle management leaders to take on horizon three ideas
They have to change the metrics across the entire organization. If not, then the effectiveness of the Horizon 3 effort will be graded using Horizon 1 metrics
Secretary of Defense Carter’s recent pivot to place the DOD’s innovation outpost –DIUx directly under his supervision after 8 months is a great example of a leader enforcing his expectations about innovation.
In peacetime Horizon 3/disruptive groups need to be led by Mavericks, sponsored and protected by Horizon 1 leadership. It is this group, challenging the dogma of the existing programs, who will come up with the disruptive/asymmetric offset technologies and strategies.
BTW, history tells us that in war time the winners filled this innovation role with people who make most Horizon 1 leaders very uncomfortable – Churchill in WWII, Billy Mitchell, Oppenheimer on the Manhattan Project, Vannevar Bush at the OSRD, John Boyd, etc.
More next week on innovation and the intransigent middle. Now back to the class.
Team presentations: Week 7
In a company you know you’ve been successful when you generate revenue and profit. But in the military success has different metrics. This week the teams’ assignment was to understand what Mission Achievement and/or Mission Success looked like for each of their sponsor organizations and each of the beneficiaries inside that organization.
Later in the class some of the team will realize they can build “dual-use” products (building their product primarily for civilian use but also sold to the military.) In those case revenue will become an additional metric.
Understanding how to measure mission achievement/success for each beneficiary is the difference between a demo and a deployed solution.
Sentinel initially started by trying to use low-cost sensors to monitor surface ships for their 7th fleet sponsor in a A2/AD environment. The team pivoted and has found that their mission value is really to enable rapid, well-informed decisions by establishing a common maritime picture from heterogeneous data.
On Slide 4-5 the team continues testing their hypotheses via customer discovery. Note that they plan a trip to San Diego to visit the customer. And they realized that an unclassified proxy for their data is the IUU fishing problem. (With a great assist from theState Departments innovation outpost in Silicon Valley.) Their Minimum Viable Product can be seen on slides 12-16 using this illegal fishing data.
Slide 10 summarized what mission achievement would look like for three beneficiaries in the 7th fleet.
Capella Space started class believing that launching a constellation of synthetic aperture radar (SAR) satellites into space to provide real-time radar imaging was their business. Now they’ve realized that the SAR data and analyticsis the business. Then the question was, “For whom?”
In slides 4- 11 they describe what they learned about illegal fishing in Indonesia (Thanks again to the State Departments innovation outpost.) But the big idea on slide 12 – 13 is that Capella has pivoted. The team realized that there are many countries that want to detect boats at night. And most of the countries of interest are located in the equatorial belt. Slide 14 is their rough outline of mission achievement for the key agencies/countries.
Interesting to note that Capella Space and Team Sentinel seem to be converging on the same problem space!
NarrativeMind is developing tools that will optimize discovery and investigation of adversary communication trends on social media, allowing the U.S. Army Cyber Command (ARCYBER) and others to efficiently respond and mitigate threats posed by enemy messaging.
In slide 4 the team provided a textbook definition of mission achievement. They specified what success looks like for each of the beneficiaries inside of their sponsor,ARCYBER. In slide 5 they broadly outlined mission achievement for three private sector markets.
In slides 6-9 they plotted all the potential adversary communication trends on social media problems, and in slide 7 overlaid that problem space with existing commercial solutions. Slides 8 and 9 show the problems not yet solved by anyone, and slide 9 further refines the specific problems this team will solve.
NarrativeMind further refined their Minimal Viable Product to product/market fit in Slides 11-16.
Aqualink started the class working to give Navy divers in the Naval Special Warfare Group a system of wearable devices that records data critical to diver health and safety and makes the data actionable through real-time alerts and post-dive analytics. A few weeks ago they pivoted, realizing that the high-value problem the divers want solved is underwater 3-D geolocation.
Slide 2, John Boyd and the OODA Loop (finally!) makes an appearance in the class. (The OODA loops and the four steps of Customer Development and the Lean Methodology are rooted in the same “get of the building/get eyes out of your cockpit” and “speed and urgency” concepts.) In Slides 5-7 Aqualink’s two versions of their Minimum Viable Product are beginning to be outlined and in Slide 8, the team passed around physical mockups of the buoy.
The team certainly got out of the building this week. In between their classes they flew to the east coast and attended the Army’s Asymmetric Warfare Drone Demo-Day at Fort A.P. Hill in Virginia. They spoke to lots of vendors and got a deep understanding of currently deployed tactical drones.
Slides 5-9 show their substantial progress in their Minimal Viable Product as they demo’d advanced detection and classification capabilities. They are beginning to consider whether they should pivot to become a drone software platform.
Right of Boom is trying to help foreign military explosive ordnance disposal (EOD) teams better accomplish their mission. Now they are developing systems, workflows, and incentives for allied foreign militaries with the goal of improved intelligence fidelity.
This week the team was actually able to talk to a key beneficiary on the front lines overseas. What they discovered is that the JIDA current technical solutions, if combined, will provide a solution of equal quality to standalone development in a shorter timeframe.
On slide 4 they outlined their Mission Achievement / Success criteria for the key JIDAbeneficiaries. Slide 9 continued to refine their understanding of the tradespace.
Skynet is using drones to provide ground troops with situational awareness – helping prevent battlefield fatalities by pinpointing friendly and enemy positions.
Mission achievement on slide 2 needs a bit of explanation; the team has met and exceeded their basic goals to reach: 80% accuracy on target identification. FromSOCOM’s perspective the team has achieved their initial mission. Now Skynet has moved beyond their original scope into an interesting area. Slide 9 and 10 show their further refinement of buy in- for SOCOM and the Border Patrol.
Pete Newell presented the advanced lecture on Activities, Resources and Partners.
Activities are the expertise and resources that the company needs to deliver the value proposition. Resources are the internal company-owned activities. Examples are a company-owned manufacturing facility, big data or machine learning engineers, DOD proposal writers, venture capital, etc. Partners are the external resources necessary to execute the Activities. i.e. outsourced manufacturing, system integrators, etc.
Former Chicago and District of Columbia transportation head Gabe Klein highlights eight lessons leaders should follow when building innovative approaches to better cities in his book “
On Slide 4-5 the team continues testing their hypotheses via customer discovery. Note that they plan a trip to San Diego to visit the customer. And they realized that an unclassified proxy for their data is the