The Frontier State of Nonprofit Accelerators

Speaker A: Let me begin by welcoming people to the second year and the second series in our Frontier State project, which Tushar Kanade and I have been running at Harvard's Kennedy School. And our guest today is the phenomenal CEO of Mass Challenge, which is the world's largest and most successful nonprofit non equity business accelerator. Um, so we're very excited to have Kate and I'll give her a somewhat more formal introduction in just a moment. But let me first introduce my colleague and co leader, Tushar Kanade.

Speaker B: Yeah, um, hi Kate. And uh, I am Tushar. I actually graduated from the Harvard Kennedy School this year. I've been working with Aira since last year when we co founded the Frontier State Project. Um, it's been quite a thrill to be honest, hosting uh, a bunch of different leaders from the public, private and nonprofit sectors. Uh, I'll just take you through, you know, just a minute, blitzing through what we've done over the past year and Just a sec, here we go. Yeah, so the Frontier State Project, we founded it last year and uh, we aim to um, research, uh, and investigate the intersection of venture capital, technology policy, public policy and entrepreneurship, particularly in deep tech, or tough tech as MIT has coined it over the last few years. Right. Uh, we have uh, a, ah, twofold definition for what the frontier state is. We believe it's both a framework as well as a moment. What do we mean by these two things? Um, we feel it's a framework in the context of Boston and Massachusetts particularly because uh, uh, it is, it is something that has occurred with methodical precision but also over a long term period of time, uh, in the state of Massachusetts. And we've seen the evidence of that in the case of biotech and life sciences, the way the ecosystem sprung up uh, in the 80s, the 90s and of course 2000s and 2010s. And we feel that there are already a lot of case studies and innovation and impact within biotech. But there are a few more cases to be unfurled and written on how biotech sort of merges into the 21st century and sort of starts blossoming into so much more intersects with deep tech as we know it. Right. And of course the intersections with robotics, the intersections with so much more human augmentation and so on. So we feel that the frontier state as a framework is our understanding or conception of what is it that delivers a policy or hand of capital and just how different markets have played in and how all of them have become um, indispensable to the state of Massachusetts. So the year one of our research was focused primarily on life sciences. Moving into climate tech. Right. Particularly from the lens of Massachusetts, we also feel it's a moment, uh, it's a moment in time. We've covered this in past editions, but, um, in, in history, we've had different moments of technological progress. We've had that in Renaissance in Europe, we've had that in other parts of the world in Asia and North America. And we feel the moment right now for climate tech and tough tech is particularly interesting to observe. And that's why Year two and Ira will also spend some more time on this. We've started expanding our canvas from just Boston and Massachusetts to the New York State state area or the Bay Area in California, and potentially also, you know, other areas and hubs worldwide. So these are some of the institutions that we, you know, have engaged or, uh, have interviewed already in the past year. And these are some of the leaders, for instance, from Travis McReady to Yvonne Howe and Dan Goldman, as well as Joker to Tony Joe Kennedy III as well as Elizabeth Turnbull Henry, that we've hosted in year one alongside Peter Dominikov. And uh, Year two, of course, is as I said right now, where we put it up. We go beyond the state and uh, you know, we would love to understand how entrepreneurship works more fundamentally at accelerators, at, uh, incubators and also from the lens of founders, for instance. And that's where we are with the frontier state, you know, just in a jiffy. But over to you, Ira, uh, just to carry this forward.

Speaker A: Yeah. So thank you, Tushar and Kate. We couldn't have a more appropriate leader to segue between the first and second year than you because, uh, you're Boston based and it's a very interesting story about how you began, but you're also now increasingly global in reach. So you're a bridge between those two, uh, years. And we're thrilled to have you kick off the series. For those who don't know Kate Brumme.

Speaker B: Ah.

Speaker A: And I do have the pleasure of knowing Kate. She's been described as a vibrant, tenacious and thoughtful innovator who leads from the front with curiosity and compassion. I wish someone would say something like that about me. Kate, that is phenomenal. And I do think it captures, uh, your style and your, your values. Um, I know that you've been with Mass Challenge for some time, and I'm wondering if you'd feel comfortable in kicking things off by sort of telling us the creation story. Maybe you and you weren't there with John Hawthorne, at the very beginning. But I know that you now run a phenomenally successful global enterprise@masschallenge. But 15, uh, years ago, when it began, I think you started on a parking lot. And Boston was not known then as an entrepreneurial and innovative hub. So how did it all happen, and where are you taking it in the future?

Speaker C: That's great. Well, thank you, first of all, both for, um, bringing me into this conversation, both in my day job and as a former both business person and public policy major. Um, this is a spot that I love to be, is exploring sort of how these major, um, sectors come together to make the world a better place. And I feel like it was my mother who might have said those nice things about me, but I'll take it either way. Um, so, uh, I'll give you a little, um, history of Mass Challenge. And you've heard John, our founder, share it, and. And his storytelling, uh, is notorious. Uh, and so it won't have that personal flair, but I think carries the heart. And then we can share where we are today. And I think really what we, um, why we're, uh, we believe in what you're saying. We're at a unique moment in time. So MassChallenge, uh, we're. We're an independent 513C organization, so nonprofit organization headquartered here in Massachusetts. Proudly part of the Massachusetts story, which I'll come back to. But as Ira mentioned today, global, with offices, you know, in other places around the US and around the world, and supporting entrepreneurs where they are and where they're building. But when we were founded 15 years ago, um, by two amazing individuals, uh, it was really to do, you know, two things. One was, um, aggregate and amass resources, um, to the entrepreneurs who take enormous personal risk to try and do something extraordinary, which is take an idea and bring it to life in a way that changes the world for. For many, many, many people and often for. For tremendous good. And I think John and Akhil, our founders at the time, were looking around, uh, and saying, wow, these. These. These founders, they don't. They don't have what they need to get off the ground. Uh, they don't have mentorship advice. They may not know how to navigate capital, or if they do, they have to work so hard to get the little things that they need to get ideas all the way to impact and scale. And that what we could do was amass, uh, resources. They talked about it in the early days, like a buffet of resources that entrepreneurs could come to Mass challenge and find what they needed quickly the other thing we could do, and this speaks to how we built mass challenge in a way that's sort of dramatically different than our for profit peers, was do it in a way that also inspired a totally new narrative. At the time it was 2009 and felt like the world was burning and yet there were these entrepreneurs building the future. And so a big part of the mission, the model was to reinspire, reignite Massachusetts and then the world and, and do it in a way that engaged hundreds and then thousands and then tens of thousands people around entrepreneurs to create a global renaissance. Which entrepreneurship was seen not only as a driver of, of progress, bringing technology from invention all the way through to impact, but also sort of re inspiring us as, as humans and this belief that we can create progress, we can work together and um, and do it in a way that creates local, national, global impact and jobs uh, and prosperity. And so those two aims help the highest impact, highest potential entrepreneurs break through and build the ecosystem around them that creates local impact. And ideally national inspiration was truly part of our founding ethos. Our founding story. John you know, found his way to some of the biggest movers and shakers in Boston and told them the most outrageous story which was I'm going to largest nonprofit accelerator in the world. We're going to charge no equity, we're going to um, make Boston a Mecca for entrepreneurship. And a couple of them said um, that's crazy but, but we'll back you. And they gave him a little bit of capital. Um, they gave him a space, free space down in the seaport which as Ira mentioned was a parking lot. And so the mayor had said I'm building an innovation district. And there were a couple of believers and John said great, we'll help do that too. And gave us um, a free space right across the street from where we are today. And um, fast forward 15 years later. Uh, I think we're super proud that the seaport is uh, a unique and exquisite destination for innovation, investment, business and has truly become one of the um, most amazing stories of an innovation district. Alongside what we've seen happen in Cambridge, uh, and Mass challenge as uh, as an organization has sort of grown and thrived. We've supported over 4300 startups. It's our founding engaged over 10,000 mentors, 500 industry and governmental partners. Our uh, companies have gone on to raise 14 billion in follow on capital. We've provided just 12 million in sort of cash grants. So that catalytic effect of early credibility, early connections, early capital just goes on to create tremendous follow on benefits for these fledgling companies and then you know, here in Massachusetts, I think proudly, statistics that have similarly been impactful.

Speaker A: It's a thrilling story, uh, and an inspiring one, Kate. Um, I think so many of us in Boston and perhaps around the world who look to Boston for innovation and excellence in biotechnology and Nobel prizes, two of which were awarded just yesterday or today to Boston based researchers, I uh, think that this was all inevitable. But you're describing a uh, somewhat improbable genesis and renaissance that began in a parking lot and now extends globally. Uh, I guess your companies have now employing something like 160,000 employees and as you mentioned, they've gained $14 billion in venture capital. It's just an inspiring story. I wonder, you're now in Switzerland, uh, and Israel as well as Dallas and elsewhere. Is this an apocryphal story? Is this a story that you know, Lagos, Nigeria and Johannesburg, South Africa can, can replicate? Uh, is there something unique about the sauce here in Boston or can, can this become and are you in fact igniting a global entrepreneurial revolution?

Speaker C: Oh, uh, well we certainly, over the last 15 years what we have seen is a total global explosion in entrepreneurship. And you know, in our case I think we uh, were more focused on and more practiced in sort of technology and science driven entrepreneurship within that broad continuum of entrepreneurship. And when you look at where ideas are coming from today, where founders are starting their businesses and even you know, choosing to stay and build, I think we are excited about the continued globalization of, of um, startups and entrepreneurship and in some cases we're proud to play a role in that. So we have a global partnerships team who works with uh, our Chile MASS program in here today where our job is not to bring mass challenge everywhere, but also to support the local institutions, the local innovation infrastructure that's being built. And so there are areas where playing an on site, on the ground role, really trying to support and foster ecosystems uh, outside of our current domains. And then I think the second part of that uh, is to bring entrepreneurs to more uh, um, sort of uh, innovation dense regions. So Boston is unique in the level of talent, the level of experience, uh, the amount of capital that's available, the type of expertise and that's hard to replicate even for geographies that are on an awesome trajectory. And so what we think of as our role in this global startup renaissance is how can we strengthen local ecosystems by sharing our knowledge and then also play a role in getting entrepreneurs that are doing something important now access to the type of uh, expertise they need that's not in their network so that they can build companies uh, that will change the world where they are.

Speaker A: Trishar, you're on mute but your turn.

Speaker B: Absolutely. Now this is a fascinating exchange so far already. Um, Kate, I have uh, questions which are more fundamental to the role of accelerators and the evolution of innovation in Boston. Uh, this is something particularly interesting for us because we are technically mapping the trajectory of innovation and how it looks different perhaps in the 2000s versus now the 2000s. Uh, what are your comments? You know graduating from HBIS 2012, then Social Finance and then obviously now mass challenge. Do you see that you know, difference or do you see it's the same set of problems repeating themselves over time perhaps in different ways?

Speaker C: Yeah, this, I mean this. I um, I love, I love, I love this question. So let me share a couple of our observations. Having been in the business of trying to support entrepreneurs for a while, um and then myself having been sort of in and around the high impact entrepreneurship space. So one is we would say that compared to 15 years ago, compared to 30 years ago when sort of the modern venture capital movement got started, um, a huge growth of resources, knowledge and activity across the venture, the startup venture space um, and that continues to be disproportionately concentrated. So on the one hand you see a massive growth in uh, whether it's venture capital firms, startup accelerators, incubators, support systems, online knowledge and networks, peer to peer learning like that's exploded but it's, it is continues to be very uh lined up with the concentration you see in venture capital which is largely software. And so on the one hand I think we're spending a lot of time thinking about how we take our proven model and focus. We talk about not sort of tough tech, we're not technology focused, we're tough problem focused. So if you think of the startup playbook is like very mature on many dimensions. But when you think about how does a company I'll go through our verticals navigate a uh co development partnership with a large food manufacturer? How does a startup um m negotiate their first DoD contract to access non dilutive capital and advance its technology roadmap? How does a company build a relationship with a ah large uh hospital system that they're like those are sort of chapters of the playbook, startup playbook which um, have yet to be written sort of in full uh, and are just hard. And so we think that generalized startup knowledge, much more mature, specialized startup knowledge still in development and that there are two aspects of that which are important. One is the capital stack which matches that growth. And I think you mentioned biotech. Biotech basically had to sort of develop its own capital continuum uh, to match the unique attributes of those types of companies and took years. Uh, and I think if you look at some of these other um, consequential but complex categories you see the same. Whereas startups, um, uh, capital stack over time just looks really different than you know what you would think of as a classic hoodie wearing startup doing um, ah, software. And then the second is we think about a lot of uh, the limelight goes to financial capital. Super important. The first thing any founder would say is I need money. And so that's absolutely the case. We think social capital and the infrastructure around that to accelerate access to social capital, inclusive of sort of knowledge capital networks, customer relationships etc. Is always important. But even more important when you think of these tough um, tough challenges because getting a first customer for example is just much harder if that first customer has to be a hospital system than ah, you know, um, um, uh, an individual user, uh, online.

Speaker A: I'll let you jump in again Tushar, but let me just pick up because I know that uh, Kate happens to be a very accomplished athlete. And I wonder Kate, in listening to you, I think most of us who are not uh, entrepreneurs uh, and haven't started our own companies, we think of entrepreneurs as fairly solitary individuals with great ideas creating disruptive change that's going to move the world. You're also describing a more sophisticated networking effect, the emphasis you place on social capital. And um, I sense that your background as not only uh, very accomplished professional but as a lacrosse player and as an athlete contributes to this team orientation that you're bringing to this next stage of entrepreneurial innovation.

Speaker C: Yeah Ira, um, uh, I appreciate, I appreciate the compliment. Uh, it was like back, back in the days. But you're exactly right. We um, the uh, sort of founder as God is a ah, really important movement which I think uh, helped entrepreneurs gain access to more founder friendly resources. And we were one of many organizations and that that's actually important because if you think about the, the balance of power between capital and entrepreneur that you know, recognizing that founders are unique individuals in their ability to see a problem, build something from scratch, bring that personal tenacity and resilience to bring it all the way through like that is a very unique and globally important skill set. And you know the there it is important to recognize the founder for that. And what, what we would say is that to get an idea all the way through. You need that strong founder. Absolutely. And, and they need to be exceptional at building teams and aggregating resources and forging uncommon partnerships and alliances around that. And that, that is more of a team sport aspect of it. So just like in sports you need strong individual accountability, you probably need a uh, tenacious performer and they need to be really good at knowing how to leverage the skill sets of those around them to win together. And so we're, we're absolutely in the category of it's an. And and the um, more uh, skillful an entrepreneur can be and in really leveraging a network in a mutually beneficial way, the uh, more uh, we think sort of the faster they can move.

Speaker A: Too short.

Speaker B: Yeah, that's quite interesting. Um, I think that this was also a great couple of responses on as we were trying to investigate the role of accelerators. Right. You mentioned that uh, it has to be founder first but then it's tough problems rather than tough tech. Sure, tough tech may solve tough problems, but it's a different lens altogether with a hospital being a first customer. Those are fascinating points. Uh, the question I have as a follow up then is what do you feel is what are some standout startups that have come up because the mass challenge model, um, that has enabled maybe certain social solutions or social problems we converted to solutions. And what startups do you think uh, you know, differentiate themselves even more going over the next five years again, even from the lengths of the last five years post pandemic. Right.

Speaker C: Yeah. Um, that's fantastic question. And we tend to think of sort of like a couple key Cs where we think about how can we add value. One of the simplest is just credibility. So you know about 70% of the companies that we support are first time founders to so to make it through a rigorous selection process and have a brand that um, we're grateful means something in many circles is, is actually a key value add. And we work really hard to make sure that that brand continues to be a strong positive signaling effect for our founders. And you know I think of one of our companies who's acquired a year ago called and said congratulations Matt, this is amazing. And he said you know there are mass challenge gave me the first um, credibility I needed that let me go on to raise some capital and then also a community of peers. So that's our second, our second C. When we think about what is um, easy but important for us to do. One is sort of the credibility of our brand. The second is to provide a community where you um, Feel less alone. But also ideally you can learn faster. Like the faster you can learn as a founder, learn what your customers really need, learn how to build, ah, an exceptional MVP and turn that into a product like that. Those learning cycles, um, in addition to the personal resilience are so important. And then the third C we think about is the first is the customer. So you know, alongside being focused on social capital versus financial capital first, we care a lot about being an exceptional partner for our companies in that um, in commercialization. And uh, there's um, a little uh, um, statement uh, that I love, which is um, uh, impact equals invention plus commercialization plus capital. And often again a lot of the focus is on sort of the invention and the capital piece. But the commercialization is where the rubber hits the road. That's how do you know what your customers want, how do you convert your product into what you want, how do you sell it to them in an economical way and build a team to scale it, et cetera, et cetera. And so when we think about, okay, how what is, uh, what is great look like for us, it's companies, um, like a visit which is local and just announced their series B or like a trust and will, uh, who's in the financial services space, which would say I got my first customer through MassChallenge and that helped me learn faster. And then also use that stamp of approval to go, to go get more

Speaker A: a little too fast for me, I want to capture that equation or that algorithm. Impact equals what?

Speaker C: Impact equals invention plus commercialization. And I add capital. I think the classic one is invention plus commercialization.

Speaker A: M. Okay, great. Thank you. That sums it up very, very neatly. Um, let me dial back a little bit, uh, if I might, because I think this is somewhat counterintuitive. Um, you mentioned at the outset part of the origin story was that you got a little help finding an office. But it was a little bit more than that. As I, as I've heard the story told by John Hawthorne, the incumbent governor at the time, Deval Patrick and the mayor at the time, Tom Menino, were really quite instrumental in Mass Challenge getting started. And uh, I think it would be informative to our audience, which is global and largely academic and VC oriented, to better appreciate that the particular alchemy and success of Mass Challenge wouldn't have resulted without the intervention and, and active participation of governmental partners.

Speaker C: Yeah, that's Ira. I'm happy to go, um, uh, deeper on that because I think you're right. And I can even speak to sort of the other Trifecta of our founding teams. Certainly, um, both Mayor Menino and then the Patrick administration, uh, uh, appreciated the role that an entity like MassChallenge could play in their long term economic development. So I think they appreciated our vision. But more importantly, how uh, Mass Challenge could be part of what I like to call the innovation infrastructure that's really necessary to allow high growth ecosystems to thrive, um, alongside. And we think of it as the infrastructure sort of connecting say universities to capital. Like you need some sort of support system, especially early on when these are just getting built, but alongside government. And I'm happy to sort of come back to the role they played. One was funding. So um, for, for the government entities out there that early catalytic for funding for us. And they didn't underwrite our whole program, but they did provide enough funding to let us match that with private sector dollars and then also to say, hey, we're. Someone thinks we're important. So we're a, we're a small, uh, tenacious organization, but the governor thinks that we're important and they think we're important to the long term vision of the Commonwealth of Massachusetts. In addition, you know, to, as a, as a new entity here in Massachusetts, but we also received support from a handful of private sector leaders, Verizon being one of the big ones at the time, and then individual um, philanthropists who had strong ties, um, to uh, uh, the entrepreneurial ecosystem and recognized the need for an entity like Mass Challenge to just help provide that cornerstone to bring together entrepreneurs and advisors, universities, investors and um, in a way that was very unique. And so those, all three of those parties were, were important. And as we think about our work in, in other ecosystems, it's evolved differently. But what we can say with certainty is when you have all four of those entities, philanthropists, private sector, uh, and government, uh, three, sorry, at the table, you have a much stronger. It's three legs of the stool. You have a much stronger standing point than when it's government only or philanthropy only or private sector only.

Speaker A: Thank you so much for painting that mosaic. Uh, we can see in, in the background of, of your uh, visual, uh, that there's an event called the Seaport. And while Mass Challenge isn't solely responsible for the catalytic convening and an explosion that Mayor Menino wanted, uh, people would probably not recognize that area. Fifteen years ago it was largely a parking lot and there's now $100 billion worth of private sector investment in and around where you are sitting. So yes, thank you for emphasizing that they not only believed in you and John and the idea, but they thought that you would be a catalyst, uh, for a much larger development which also met their self interest and desire for change.

Speaker C: And I'd love to. I think I appreciate that you mentioned the point. Self interest because um, that's actually really important aspect of this is to understand sort of how we fit into the interests of the private sector or the, or government from a job creation perspective or, or even philanthropy because it's our mission alone we think is important, but it's so much more powerful when it's sort of working at the intersection of all of these sectors which have very different self interest.

Speaker A: I don't want to embarrass Joe Fallon and the Fallon companies, but they were looking for a marquee tenant and they had available space and a gorgeous building in a new area and they needed to fill it. And that was. So. It was a beautiful intersection and just great timing.

Speaker C: That's right. That's right.

Speaker B: Absolutely. I also love Seaport. I would have in another decision would have been living there this uh, semester, uh, as I was discussing with ira. But uh, it's, it's a, it's a great story. Of course, um, and the IRA and I keep going back and forth around the history of different parts of Boston and of course Seaport stands out. But um, coming back then to you know, some, um, of the uh, some of the principles you mentioned, uh, around, you know, the tri sector, uh, what is it? The union of the tri sector incentives. Right. Whether it's philanthropy, private sector. Yes. As well as the government. Uh, I think there's a lot more to be learned and explored through the lens of public private partnerships here. Correct. And uh, what do you feel, you know, the government is doing? Well, not just the state government of Massachusetts, but you can again now expand to your opinions in New York and California and maybe even beyond. What do you think government is doing great today as far as enabling startups and entrepreneurship is concerned? Now that could be tough tech. That could be something much simpler. And where do you think, you know, there's a lot more improvement that perhaps we can still make.

Speaker C: Yeah, that's um. So one of the things I think that has been uh, very visible at the national and I think is being replicated at the local level is a strong recommitment to the role of emerging technology, sort of commercializing science and research and emerging technology, uh, into startups and industry, et cetera. And that whether it's through various large pieces of federal legislation or the launch of uh, And ARPA H for example, I think the signaling effect and therefore the vibes that has sent out across the nation um on many different levels has been extremely positive and we think really productive and reminding ourselves that uh, uh innovation but entrepreneurial led innovation has been a cornerstone of what makes uh the United States unique. Uh what has led to our um, economic leadership and technology leadership uh in many many domains. And and then I think also the, the recommitment from the federal government including uh the Department of Defense to really support and foster the uh emerging technology and tough tech space as a long recognizing it's, it's unique, it needs more support, it needs more um incubation if you would. And so I think that has been extremely productive over the last couple of years and and certainly is something that we see reflected in the companies we supporting uh uh um who who are choosing to come to the US Uh for many reasons including that it feels like the nation is supporting them and that there's non dilutive capital and variety of resources. I think the second thing that um has been done well at the national level and then also in um replicated in many geographies is uh, trying to make large investments in distributing out some of the innovation infrastructure which has led um to places like Silicon Valley and Boston to be such leaders. So whether it's through the NSF engines or other sort of tech hubs we think that's a real positive look. It is hard to replicate a um, an ecosystem like a Silicon Valley or Boston which are both large and asset dense. But we still think it's positive to push resources and expertise out across the country to share learnings and drive collaboration around things like commercializing um, um IP tech translation, um early startups etc. So we think all of that is great um here in um. And then the last piece I'll note is I think we think it's been great that um here in Massachusetts and we see this in other geographies uh that are slightly farther along have really focused on where can we lead and what do we need to do to establish our leadership or sustain our leadership. So in Massachusetts that's certainly life science where we're the most known but I think are contenders in areas like robotics and digital health, et cetera. And so um, you see it in Pittsburgh around robotics and now moving into biomanufacturing for example. And so we think ecosystems that are picking a couple sectors and really making large scale investments, trying to bring public and private together to support those um, are real positive, interesting and um, it's

Speaker B: also intriguing that you mentioned uh, the Engine which is definitely one of our uh, questions as well because we're going to be hosting the Engine uh, in about two maybe three weeks. The leadership of Engine potentially also the leadership of new Lab in New York and perhaps the Y combinators and the like from the Bay Area uh, through this year. So how do you think, you know, on the first layer, Mass challenge the distinction as well as the, the complementarity with the Engine within the same geography. How does that apply? And secondly how do you think uh, different cities, if you have any opinions um, are, are dealing with this, this complementary formula of having perhaps non dilutive capital through accelerators and other entities may be driven by the government as well as obviously you know, for. Prof. Which are driving it a little bit differently perhaps with a more formulaic approach.

Speaker A: Mhm.

Speaker C: Yeah, that's great. I was just on with Emily ah Knight, the CEO of the Engine last week. So um, uh what I can say is like we think of ourselves as uh, strong collaborators for the benefit of founders and for the benefit of Massachusetts. Emily's uh, organization is deep, deep deep when it comes to uh, tough tech innovation. I think very focused more so than us on that initial lab to life movement. Uh and then uh, very regional we, when and where we can send them companies. They also have sort of a place based element in terms of the Engine as an actual um, space for tough tech founders. And I think that's similar to Greentown Labs. Oh uh, you know I think we think of our role here in the ecosystem. One is supporting founders solving massive challenges whether or not they're deep in quantum or have a novel application that happens to have a hard uh, um, problem it's solving. Like I'm thinking Digital Therapeutics is a great example. May not classify as tough tech but absolutely are in the tough challenges space. So one is, can sit alongside a specialist organization like the Engine to really build out that continuum support which make Massachusetts exceptional. The second is our, our model differentiates in that we, we are as focused on supporting local as attracting global. So about a third of the companies we support each year are in the region and then the other ones come from all around the world. And we think that's a important for founders and, and b great for our ecosystems. You know, same as we look in uh, Texas or Switzerland or Israel. So that's a differentiator and, and by the way lets us bring companies from around the world not only to Mass Challenge but over to the Engine as well. So they can experience the best of the, of uh, what an ecosystem has to offer.

Speaker A: I'm sorry. No, please, please Kate.

Speaker C: Oh no, I was just going to note, you know, I think we tend to um, uh, it is good for founders to have ecosystems with many partners and so most other people are quite worried about you know, there being multiple accelerators or incubators and we think that's an exceptional signal. Uh, and that uh, founders, you know, if you're raising money in Silicon Valley, you're gonna, and you're a first time founder, don't have a personal network like why Combinator is where you want to be. That's, that's not us. You're trying to get a first customer in some of our big domains. We're, we're probably a better partner for you because that's how the programs are built. That's the way our model's been designed. If you're looking to um, be literally physically be amongst other tough tech founders as you take that initial step, like we would send you to the engine all day long. And so that specialization is so good for founders, uh, and really just a signal that the industry is maturing from being very generalist to um, much more specialist.

Speaker A: Before we let you.

Speaker B: Okay, sorry.

Speaker A: I'm wondering whether you can take us a little bit to the 35000 foot level. In part because you do have a global perspective and you're a thoughtful, purpose driven leader. Uh, the world is in chaos and fairly anxious about the future, especially young people. The global challenges that we face are quite existential. And you know, what's your perspective? You've got this unique lens. You're dealing with thousands of bright, highly motivated, uh, tenacious young people who want to change the world. Um, they're up against great odds and they need to navigate finance and government and regulation. Uh, you know, what, what's the state of innovation globally? And, and, and, and, and are you optimistic about our global future through that lens? Sorry, it's such a big question but I think you're uniquely situated to offer us a thoughtful perspective.

Speaker C: Yeah, this is so, um, we think that, or I say, I think at moments like this, um, there is an opportunity and really a need to choose to be in the optimistic camp with a realistic lens. And so that is uh, that is something that we think is um, necessary and important because the only way you can solve big problems or um, bring uh, um, opportunity, uh, and God willing resolution is by believing it's possible. And, and so that is sort of one is, is we would encourage folks who are out there to, if you can, you know, with your realistic lens, choose to be in camp. Optimism versus pessimism. Uh, and then the second is that, uh, as part of that camp, uh, to do what you can to be part of the progress. And you know, we have the benefit of working with entrepreneurs who are like probably the entre. The uh, governmental entrepreneurs that are listening here are at the, you know, frontier of how do we think about this differently? How do we bring new solutions to market, work together in different ways, harness technology for good and for progress? There are, there are millions and millions and millions of people in all sectors who are taking that approach. And so that is what keeps me optimistic, is working not only with the entrepreneurs but, but with our colleagues in government, in the private sector who are willing to do hard things, to work together in new ways to try and bring progress. And um, uh, when you look at the rapid advancements in technology and some of, we didn't sort of get to talk about what's coming down the horizon, like there is massive opportunity and we have to work really hard to bring it to life and to bring it in life in a way that creates more, a more inclusive, a more equitable future that is not, that will not happen by de facto. Um, but I, I, we do believe that, that it's possible. And, and it starts with being in, in on team optimism.

Speaker A: Thank you so much, Tushar.

Speaker B: Great. I think this has been a fascinating conversation. Honestly. We would love to ask so much more, but, uh, you know, I would also lead lunch. I would also lead into a couple of more questions. But, uh, you mentioned Switzerland, Mexico. It's been so many success stories. I've been, you know, Ira and I have been reading through the website looking at the unicorns or the success stories on the website itself. What do you feel? Uh, you know, could be a further scale up. Like, what are some of the growth challenges in your end if, if there are some growth priorities for you? Uh, from mass challenge, like, what is the next stage for mass challenge for you as a leader? And also overall, just the space of accelerators. Right?

Speaker C: Yeah, that's, uh, fantastic, fantastic question. And so we definitely, from an industry perspective, we think it's, you know, as nerds in our industry, it's like a fascinating moment in time. The industry's matured significantly. I think the, um, current state of venture capital has created a real shakeup in dislocation. Um, and an open question sort of around what the next iteration will look like. And look, we have a Couple beliefs. Uh, and it's really, it's driving our strategy. One is that you know, we continue to believe that entrepreneurs have and are a driving force for progress and more specifically sort of solving some of our most massive challenges in the world. That there has been a significant amount of growth and evolution which is a positive. And uh, when you look at where venture capital is concentrated today, at sort of where entrepreneurship is concentrated today, that an entity like ours, um, can and must be focused on continuing to push on sort of the frontier, rethink the support structures that are available, address the gaps. So our goal over the next 15 years is to build a leading platform for startups solving massive challenges. We want to create a home, a first landing home for companies that are working on healthcare, sustainable food security, resiliency climate who need early support to navigate, uh, uh, that early product market fit work and then sustained support as they look to scale commercially. And so that we think it remains a massive gap in the marketplace. We think that's here in Massachusetts and global. And so one of our ambitions is to use our current hubs to build new hubs that give entrepreneurs that really unique sense of community globally, um, against these massive challenges.

Speaker B: Brilliant. I think in the final follow up, and this is a great answer for uh, all of our audiences. Uh, but it's a final follow up, I think it's about measurement of impact both at the mass challenge of the firm, the company level, but again at a personal level as well. Right. Uh, you'll have some of your batchmates from 10 years back, you know, on venture capital career pathways. You'll also have other accelerators that some of which we discussed on this call on this uh, talk, uh, how do you measure impact as the CEO of MassChallenge? What is a successful startup for instance? Is it, you know, I mean of course, you know, you can mention metrics but it could be something overarching. And further, what do you think you would be looking at as your own life cycle? Right, as a fun life cycle exit over 7, 8, 10 years. How do you think you would view the next seven, eight years and then the seven, eight years beyond?

Speaker C: Mhm. That's so that's, that's my sort of my personal exit plan.

Speaker B: I mean both, both, you know, how do you measure impact for mass Challenge as the CEO, but also how do you measure impact personally?

Speaker C: Yeah. Okay, so um, I'll go into the mass challenge. We're a non profit, we like the theory of change framework for audience members who aren't familiar. Um, it tries to lay out a linear relationship between inputs, activities, outputs, outcomes and long term impacts. And so um, uh, I'll share what we've been doing and then where we're aspiring to go subject to our own uh, limitations as a small organizations. But you know we, we look first of all sort of top of the funnel at the number of application startups. We're seeing the various um, characteristics of those applications. We care a lot about the um, uh representation in our applications on a number of different dimensions, sectors, founder, race, geography, et cetera. Like we want to know that we're out in the world finding the best and the bright and the brightest looking forward will care also that those are representing the target areas where we think we can add the most value. Um, uh, the input sector for us reflects uh, a lot of the, what we know in our data to be sort of leading indicators of traction. So you know many times you talk to folks they care a lot about like attendance, engagement, etc. Um, those are valuable for us in terms of assessing the perceived um, startup, perceived value of various components. But we know what we know actually moves the needle for startups in terms of traction which is what we care about. It's around did we help them gain access to unique introductions or connections that move the needle against their problems. And in some of our programs that's specifically a customer. So those are examples of the types of metrics which we're looking at operationally. In the short term we have specific programmatic outcomes which measure initial traction at the baby stages. Those are, those metrics might be quite incremental like did you actually capture IP, hire a new staff member etc. Uh, and then long term we look at survival, revenue, funding, jobs. I think our goal over the next couple of years is also to be able to in each of our sector domains start to have a better indicator of are we building companies in healthcare that have meaning, meaningful impact on patient lives and ideally on health disparities. Those, those are big hairy long term impacts which we care about alongside sort of jobs and wealth creation uh, that we will uh, but that we will um, be looking at. We're already doing some early work in our sustainability portfolio for example around CO2 emissions and for me personally, um, so I spent my whole, I got started uh, when I was in college during the microfinance craze. I don't know if you all remember that when there was this Accion and

Speaker A: Axiom bank and all that.

Speaker C: Yeah, yes. And so there was this um, excitement uh, that uh, business could be applied differently to drive opportunity and progress. And there were a lot of different forms of that and capital. And that's what I spent my whole career, um, inspired and obsessed by, is there are different ways for business, philanthropy, government, and investment to come together in small and large ways, uh, to try and create more opportunity and more progress. And so, for me, as I think about what can be my legacy here at my at Mass Challenge, we would love to be part of creating a new narrative around what entrepreneurship can be out in the world. And I think we have the first version of that narrative when you look at companies like Google, Airbnb, etc, creating massively scalable companies through technology that employ thousands. But imagine if we had those same stories around companies that totally transformed healthcare for the positive or how our food systems work. And if we can even be a small role in those big new stories, I think that that's what gets me out of bed every day.

Speaker B: Fantastic. Uh, this is a great answer, and I'm sure. Go ahead.

Speaker A: CEO of MassChallenge. Uh, your enthusiasm, your expertise, your vision is really inspiring. And I'm speaking not only for Tushar, but for all of us here in Boston and Massachusetts. We are blessed to have you and Mass Challenge in our neighborhood. And, uh, we can't wait for the next chapter and the narrative that you and Mass Challenge will be writing not only for our region, but for the world. Thank you so much for being our guest on the Frontier State. You've really illumined, uh, so many issues and, uh, left us on a very high note and a very inspiring one as well. Thank you, Kate.

Speaker C: Well, thank you. It's been my pleasure.

Speaker B: Thank you so much.