“The idea that entrepreneurship is a meritocracy is a myth.” Ross Baird bases his debut book, The Innovation Blind Spot, on the premise that capital fails to flow to the most innovative and useful new ideas. Instead, he argues, “money flows to the ideas that are the most convenient to find or the most familiar.”
Baird identifies three major blind spots hindering our innovation process. How we pick new ideas, where we find new ideas, and who we invest in all present problems in the innovation economy.
He crafts his arguments to appeal to both logical and emotion-oriented audiences. Utilizing a mixture of hard data and anecdotes from his venture capital experience, Baird makes cases against the traditional due-diligence process, warm introductions, and pattern recognition. Overall, his attempts to eviscerate traditional investment thinking prove potently effective. However, a critic with no solutions is about as valuable as an angel investor promising capital he doesn’t possess (read the book and you’ll get the reference).
Luckily, Baird dedicates a resounding 100 pages to describing on-the-cusp solutions to mitigate blind spots and develop flourishing entrepreneurial ecosystems. He lays out a multitude of impact-oriented ideas for investors, governments, and entrepreneurial ecosystem builders. His proposals even extend to ways in which entrepreneurs and large-company employees can play roles in mitigating biases. Although he occasionally delves into the weeds of high-level concepts, his solutions are generally accessible and filled with forward-thinking wisdom.
As the President of Village Capital, Baird brings a unique perspective to venture capital investing. His firm uses a peer-selection model where entrepreneurs rank one another, and the top two startups receive seed-stage capital. Most importantly, Village Capital employs one-pocket thinking by investing in social ventures, rather than focusing purely on profits and making philanthropic contributions on the side (two-pocket thinking). Village Capital’s fund invests in 5 sectors (Financial health, Education, Healthcare, Energy, and Agriculture), which are addressing pressing global problems that affect the majority of society.
Along with promoting one-pocket thinking and peer-selected investment, Baird elaborates on intriguing models for impact investing. Using Access Ventures as a case study, he describes how investors can focus on impact-oriented returns across asset classes and cultivate entire ecosystems. This is a particularly useful model for institutional investors and hedge funds. In the venture capital arena, Village Capital’s VIRAL (Venture Investment Readiness and Awareness Level) provides a brilliant mechanism to break down communication barriers between investors and entrepreneurs.
The concluding section of the book, “Topophilia” (love of place), is where Baird’s voice and vision resonates the loudest. He discusses the creation of thriving entrepreneurial ecosystems outside of Silicon Valley, New York City, and Boston. Tying all of his ideas and actors together, “Topophilia” opens the doorway to a future of bottom-up economic and cultural development, restoring the American Dream.
If you possess an inkling of intrigue about Ross Baird’s vision and ideas, I highly recommend purchasing The Innovation Blind Spot. This book will open your eyes to a plethora of possibilities for a future world, filled with one-pocket thinking and bottom-up ecosystem building.
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