Governments & Startups Just Don't Mix

[Commentary] Startup America looks like an opportunity to get a lot of press, with low returns for actual startups.

The goal of the program is to “continue to marshal private-sector resources to spur entrepreneurship in the U.S.,” something I'd argue is already happening at most of the levels the program plans to concern itself with. It will focus on replicating successful accelerator programs such as Denver’s TechStars, expand entrepreneurship education and boost the commercialization of new technologies out of colleges.

At their best, governments want to boost the overall economies of their constituent base and want to spread diversity and other warm and fuzzy ideals. For example, the program will offer roundtable discussions in cities to teach people about building businesses and there will be an incubator created to help veterans build companies.

At their worst, governments can be a source of patronage, and have a tendency to fund people or businesses that aren't the best. On the flip side, both entrepreneurs and VCs are pretty Darwinian and ruthless when it comes to allocating their time and resources; their goal is to make money.

So other than some good publicity and a friendly program that will point back to everything President Barack Obama is doing for entrepreneurs, I'm not sure this effort will make that big a dent. Sure, it helps get a bunch of names together to push entrepreneurialism, but most forward-thinking regions and universities are already working on building programs for better commercialization and many incubators are providing mentorship where there’s interest. Perhaps we’re beginning to see the creation and solidification of an “innovation” lobby that will push for issues close to startups’ hearts such as more H-1b visas, the slow patent application process or opening up monopoly markets.