Genealogical Trees in Startup Ecosystems
Many communities do not have an accurate understanding of their entrepreneurial ecosystem. One key error is to assume that the biggest enterprises are spinning out technologies and companies. Thus, many in Omaha believe that the most frequent source of new startups is companies like Mutual of Omaha or Union Pacific. This is false.
Instead, the company that produces the most startups is an enterprise called ACI – Worldwide. ACI is a payments system company that has their genesis in the early ATM software days. There are four things that have caused ACI to be a significant generator of new startups.
They are in an industrial area – payment systems – that has had significant and continuous evolution – both technical and business. This has created a number of new opportunities.
They churn employees. Because of the evolution, the company has moved into and out of many businesses. This has displaced a number of talented, knowledgeable people who have ideas or even business units that have spun out to pursue separate business lines.
The key players have stayed connected to each other. Bill Fisher (now of Treetop Ventures) continues to play a key role in cultivating new entrepreneurs both within and outside of ACI. Thus, individuals – such as Gordon Whitten (Its Deductible, Sojern, and Score Vision) move within the circle even though the original landing point was not from ACI.
They have a mini-ecosystem – entrepreneurs, finance, knowledgeable community, infrastructure – and they leverage that to help each other. For example, key employees have joined forces to pursue opportunities rather than immediately jumping into other corporations.
This genealogical tree has had an incredible impact on the Omaha ecosystem. Some companies with ties to ACI and its genealogical tree include (and there are many more):
Global Transactions Group
This list represents a small snap shot of companies related to ACI. When writing this blog, I wanted to give an overview of the depth and breadth. So, intentionally included are companies that did not start in Omaha – but elsewhere. So, intentionally included are public companies, large venture backed companies, and failed companies. There are many more small and failed companies – but also more big ones or venture backed ones.
In addition, one of the key elements of ecosystem building is seeing clusters and the development of clusters. ACI sits squarely within the FinTech cluster in Omaha. So, when you couple ACI genes with those from other corporations – PayPal, First National Merchant Solutions (now part of Tsys), and First Data, there is even more startup activity. But, the key is that the activating partner to this activity has often been ACI – not the larger companies.
One key question that I get regularly is “how do I find startups?”. I think that my answer is that by sifting data, doing coffee meetings, and searching with an open mind. You will stumble upon veins of super interesting things. In the case of the ACI vein, I found it because a friend’s father was part of a startup. I looked into it and started digging around funding, partners, etc. That is how I found Treetop and Bill Fisher. Bill is, in many ways, the silent brains behind the startup community in Omaha. He has helped or affected more startups than any other person here – probably. And yet, most people on the street would not even know that he exists. He is humble and self-effacing and rarely in the limelight. From my experience, this is actually more typical of the top community leaders and builders in the ecosystem than a loud, charismatic hard charger. These men and women are focused on acting without the need for recognition.
By the way, not all of the companies above are home runs, and not all of the companies above are even still in business. The point of this blog post is that communities seeking to better understand their entrepreneurs and their ecosystem should be looking at genealogical trees. Those that rapidly and regularly spin out great companies should be cultivated and understood. They should be looking for companies that are producing many off-shoots not just successful ones.
If you are trying to build an ecosystem, you understand the genealogies of your startups – particularly those in industrial sectors where there is a lot of smoke. Often you will discover some unexpected mothers and fathers in the past providing you with a link to many other great startups in your community.