It is the 23rd of July and I am writing a post about Independence Day. Better late than never I suppose. The truth is that I started this post around the beginning of the month, but it was something that took a lot of time as it was important to me that I got it right.
Something about the 4th of July has always made me stop and think. I don't know if it is the fireworks, the flags, or the hot dogs. Maybe it is the fact that the broad brush strokes of Independence Day never change year to year, which serves as a great measuring stick for how much my life has.
This year there was a lot to think about. If you were to listen to the media and your Facebook feed, things would appear like they have never been worse. Partisan politics, trade wars, and children being ripped out of their parents' arms are just a few of the negative images that you would get blasted with if you were to so much as glance at a newspaper stand (do those exist anymore) or flip on the news. Things seem pretty bleak. For the first time, optimism among Americans under the age of 35 is less than that of people 55 or older.
But I don't believe that things are as bad as they seem. The 24-hr, commercial fueled news cycle is in the business of sales, and unfortunately, drama sells more than optimism. It is important to remember that things are rarely ever so bleak as the media makes them out to be (nor are things ever as perfect as your friends' Insta stories make them appear). That's why during times like this, I like to take a step back and think of everything that is going right! Here are some reasons to be optimistic about America.
The Revitalization of Small-Town America
Rumors of the demise of small-town America have been greatly exaggerated. The state of our nation has people very worried. The difficulties and divides facing our country are very real. Partisan politics and national outrage dominate the headlines of the day. Cultural, ethnic, and socioeconomic divides seem to be deepening. A 2016 study by the Atlantic found that only 36% of Americans thought the country was headed in the right direction.
Dire as things may seem, there is a different story going on in local communities across this country.
In the same Atlantic poll, two-thirds of Americans said that they were satisfied with their own financial situation and 85% said that they were satisfied by their position in life and their ability to pursue the American Dream. It is not a stretch to believe that sentiments likely have improved over the past two years with the economy the strongest it has been over the past 9-year expansion and with the jobless rate near 20-year lows and wages growing in step. This dichotomy between national and local sentiments is indicative of the resilience of America and our local communities. We may fight and kick and scrape at the national scale, as we segment ourselves by political affiliation, sexual orientation, race, and any differentiating factor we can find, but spend some time walking around main street America, and you will find that people treat each other as neighbors. They treat each other with respect and kindness. The media and our technology have allowed us to dehumanize one another, but at the micro level, we still see each other as human. Two people that may yell and scream at each other over social media are happy to help each other carry in the groceries in the real world.
I have been fascinated by the story of James and Deborah Fallows. The Fallows are journalists that have time and time again upended their lives to follow the biggest story of the day. They spent the 90's following the rise of tech giants like Microsoft and Amazon while living in Seattle. During the 2000's they lived in China and were there to witness firsthand China's economic explosion onto the world stage. In recent years, they have turned their eyes on small-town America where they embarked on a multi-year journey to visit small towns across the country and try to understand what is happening in everyday American communities. Their findings are that the state of our union is much healthier than would appear to outward observers. In their travels, they attributed these local revitalizations to the following drivers.
Civic Governments - Polls have found that while only a quarter of Americans believe that the national government is doing the right thing, as much as three-quarters of Americans believe in the steps that their local governments are taking. The Fallows observed this first hand across an array of communities of differing ethnic and socioeconomic backgrounds. They believe that these rejuvenated local governments are caused by the increasing quality of local government workers as well as the rise of technologies platforms which allow for easier interaction and adoption between governments and their constituencies.
Immigration - The Fallows found that despite the increasingly vitriolic national rhetoric around immigration issues, cities that were actually acting as the landing ground for new immigrants were doing an exceedingly good job of integrating them into their communities. Medium-sized cities that take in many of the refugees coming to this country have celebrated them and now immigrants make up a vital and impactful part of these diverse communities.
Talent Dispersal - There is a growing trend of highly skilled, highly educated workers moving and returning to small towns across the country. People are tired of brutal commutes, high costs of living, and status-obsessed cultures of our major coastal cities. As someone that is a part of this phenomenon, I can confidently say that my wife and I are loving our choice. People are noticeably more warm and friendly in Columbus than they were in DC and there is a real sense of community that you can get in a smaller town than you would ever get in a big city. Cities like Columbus are big enough to have a ton of things to do and all the modern amenities you could ask for, but small enough to maintain a community identity and avoid issues that bog down big cities like traffic and skyrocketing rent.
Schools - Our education system has issues and in many places lacks resources, but small town communities are developing creative solutions to this problem. An emphasis on community colleges and trade schools helps to equip people for fulfilling careers without the overwhelming financial burden of attending a traditional 4-year institution. College is not for everyone and small towns are leading the way in rethinking what a more flexible and inclusive system of higher education could look like.
Libraries - One of the most interesting findings the Fallows made was the health of libraries across our country. Most would expect that Libraries were dying the same slow death that has plagued chain bookstores. What the Fallows found (and what nearly every measure of engagement backs up) is that libraries are actually becoming more central to our civic life than less so. Libraries have become community meeting grounds where educated and trained librarians can help connect people with the resources they are looking for.
Manufacturing - The face of manufacturing is changing and small towns are the benefactors. Modern manufacturing is not synonymous with giant plants and factories. In many small towns throughout the country, old factories are being renovated and turned into small high-tech development work spaces. I see this trend myself everyday. My company's cutting-edge work space with all the neon colors, exposed brick, and open rafters you would expect from a startup organization, used to be a mattress factory!
Downtowns - There is a huge trend of downtown revitalization going on across small towns. According to Fallows' article, as many as 1,000 downtown-revitalization efforts are currently underway across the country. Columbus is a very cool poster child for this with one of the most successful downtown revitalization efforts. Other cities like Pittsburgh, Cincinnati, and Detroit have had hugely successful revitalization efforts and turned neighborhoods that were once rundown into vital hubs of culture and community.
Conservations - Local governments and private individuals are working together across the country to conserve monuments, national parks, and wildlife refuges.
The sun has not set on America. Small towns are shining examples of the values that we, as a nation, aspire to. The question remains, will the current toxicity of our national discourse trickle down into our towns? Or can grass root movements in our towns foster increased innovation, collaboration, and understanding at the national level. I sincerely believe that it can be the latter.
The Democratization of Entrepreneurship and Innovation
A renewed focus on entrepreneurship in non-traditional tech centers is spurring a wave of innovation across America. This has been an often discussed topic on this blog and it is a phenomenon that I am fortunate enough to be experiencing first hand. This may be a bit repetitive with my prior reason for optimism, but I wanted to really shine a light on this phenomenon and bring in some of my personal experience.
I believe entrepreneurship and innovation should be the utmost concern for any modern society. Launching new and innovative companies not only spurs the economy but creates better paying and more fulfilling jobs for workers. For a long time, certain cities have created the lion's share of new enterprises. The poster child for this is Silicon Valley. The cradle of American innovation. Silicon Valley got its name from the development of silicon semiconductors that began to be produced in the 1950's. The innovation occurring in the San Francisco Bay area has, is, and will continue to be vitally important to our future. Other traditional tech ecosystems like New York, Boston, and Los Angeles have their own track records of innovation, but for some time now, the flow of venture capital funding has been too highly concentrated. In fact, 3 states receive as much as 80% of the venture investing in America. There are a variety of different drivers behind this, between the historical performance of startups from the region, popular (if inflexible and outdated) narratives around where you can scale a startup, and where investors are actually based (most investors want to invest in startups within a 20 minute drive of their offices).
What is NOT a reason for this concentration of capital is that 80% of talented entrepreneurs and high-quality startups in this country reside within just 3 states.
There are innovative companies and entrepreneurs with game-changing ideas all across the country. I uprooted my life and moved halfway across the country to a state I had never been before based on this belief. And that belief is paying off! I have been hugely impressed with the quantity and caliber of entrepreneurs and new startups that I am seeing in the Midwest. People are skilled, optimistic, and collaborative. Talented individuals come from diverse backgrounds and have new ideas about how they can make an impact. Cutting-edge research institutions and large corporations are coming alongside budding entrepreneurial ecosystems and supporting them with funding and partnerships. And investors are starting to take notice. Revolution, a DC-based venture firm headed by AOL founder Steve Case, has been at the forefront of this trend with their $150 million Rise of the Rest seed fund. But they are not alone. Drive Capital was funded by ex-Sequoia partners to invest in the Midwest in what they called "the opportunity of our lifetime." HighAlpha, an Indianapolis-based venture studio similar to Rev1, just closed on a new $100 million seed fund. More and more investors are starting to take notice of the Midwest and I believe that the number of investments and high-growth companies in the region will only increase.
I have really enjoyed the brief amount of time I have been able to spend here in Columbus. I have been very impressed by the maturity and quality of the entrepreneurial ecosystem and I am excited to get a front-row seat to the region's continued growth as I work everyday to help support entrepreneurs!
The Re-emergence of America as the Solver of Tough Problems
America is once again throwing its full weight against difficult problems. There are natural cycles in economic and technological development. One that I have clearly seen over my lifetime is the cycle between creating markets and saturating markets. New markets are built by creating innovative new infrastructure technologies. These platforms enable a host of new products and services to be developed that were too expensive or difficult to be built before. As the cost of creation comes down, more and more players seek to take advantage of the new market opportunities and the market becomes saturated. Margin dries up as products and services are commoditized, incenting people to seek new opportunities and the cycle repeats as value accrual cycles back and forth between infrastructure development and building on top of existing platforms.
People solve tough problems (creating markets through critical infrastructure) => people solve easy problems (building on top of that infrastructure) => incentive to solve easy problems decreases (oversaturation/commoditization) => people start working on tough problems (building new infrastructure)
We have seen this play out in a variety of different areas.
In the early days of the web, all the value was created by the companies like AOL and Netscape that were building critical infrastructure. As the platform developed, huge opportunities were created to develop on top of existing infrastructure. These easy problems were solved and a bubble was formed as too many people were chasing value in a saturated market.
The next major infrastructures developed were mobile and the cloud. Innovations like the iPhone and Amazon Web Services created huge booms as millions of companies and ideas now had the platform (mobile) and ability (AWS and other commoditized services driving the cost of development down). Since the creation of these major pieces of infrastructure, much of our innovation has centered around the solving of "small problems." Social networking app after social networking app. Photo sharing site after photo sharing site. Our best minds have been focused more on developing uses for existing infrastructure than on developing new innovations themselves. To be clear there isn't anything inherently wrong with solving "small problems." It is a natural part of development and leads to huge amounts of value creation. But the key to a nation's long-term future is its ability to solve tough problems and create the next infrastructure that enables new waves of innovation. It is this exact capability that turned America into the great superpower that it is today.
I am optimistic because the United States is once again at the forefront of solving tough problems. We are leading the way in developing the next generation of game-changing technology. Genetics, Driver-less Vehicles, AI, and cryptocurrency are just some of the next generation of infrastructure that America is leading the way in building. All of this without mentioning Elon Musk, who is basically Secretary of Tough Problem Solving with his efforts to stop global warming (Tesla and Boring Company) and make humanity an inter-planetary system (SpaceX). Solving tough problems is what made America great. A renewed focus on solving the toughest problems mankind has to offer will make us great again.
America is not perfect. We have our issues. A bunch of them. And they are not always easy. But America is also not down and out. It's the bottom of the 9th and we've got them right where we want them.
Time to swing for the fences.
Happy (belated) Independence Day.