This week at the speaker event Social Innovation in the City -- hosted by High Ground News and EPIcenter -- David Tarver discussed urban entrepreneurship and how for-profit companies can solve city problems and make life better in Memphis.
When asked to define social innovation, Tarver hesitates. While people tend to call his area of expertise social innovation, he just considers it to be urban entrepreneurship.
"The two terms are often used synonymously," he said. "I focus on solving problems for people living in urban communities. If you view that to be a social mission, then the name fits."
Tarver focuses on how for-profit businesses can solve problems in urban communities. Through his organization,
Urban Entrepreneurship Initiative, he empowers entrepreneurs to produce profitable business solutions that also address a civic issue.
"When people talk about social innovation in general they are talking about new business models, processes or inventions to create business activity that does some social good, that achieves some social end. That might be something that is for-profit or not-for-profit. My organization focuses on for-profit entities that also aim to produce benefits for people in urban areas," he explained.
For Tarver, the best example of this approach is the ride-sharing company Uber. The majority of people who take advantage of Uber's service are doing so in urban areas, and the ride-share solves a very real urban problem — how do people get from point A to point B? In a city where public transit is insufficient and a taxi use is unavailable or expensive, Uber intervenes and closes the gap. And in addition to addressing a transit issue, the company also creates a significant number of jobs in those cities.
Often one of the most significant challenges for an urban area is the availability of decent paying jobs. Urban areas are in need of accessible jobs that are not necessarily high skill, Tarver says. The first step in urban entrepreneurship is developing products and services that improve the quality of life for urban residents. The second is identifying business models that produce a significant number of jobs for people who live in urban communities.
"I consider Uber to be the poster child for a successful, urban-focused business. Though I doubt the founders of Uber considered that when starting."
Tarver is a longtime entrepreneur who now has developed into an urban entrepreneurship expert. Born and raised in Flint, Michigan, he pursued engineering after high school, originally enrolling in the engineering program at General Motors Institute (now Kettering University). After two years, he transferred to the University of Michigan Ann Arbor, where he received bachelor’s and master’s degrees in electrical engineering. He began his professional career at AT&T Bell Laboratories in New Jersey, a premiere research and development company in the field of electronics and telecommunications. The job was ideal for him.
"It was the place to work at that time. I went to work there because I knew I wanted to start my own business, and going to this place — because it was so innovative — would give me the skills to start my own business."
And that he did. In 1983 he launched Telecom Analysis Systems in his basement with two colleagues and in 1995 engineered the sale of that company to Spirent plc for $30 million. Before leaving the company in 1999, he spearheaded the creation of a $300 million Spirent telecommunications test equipment business.
"We created a series of instruments that are used to this day in lab testing of cell phones. Every significant cell phone manufacturers in the world uses it," he said.
After his time with Spirent, he was was ready to turn his attention elsewhere and hopefully get involved in community service. When he and his wife returned to Michigan in 2007, his calling was clear. As he examined the difference between Ann Arbor and Detroit, he noticed a disconnect.
"You go to Ann Arbor and it's thriving and you go to other cities and they are crumbling. I saw that more resources and intellect needed to be available to solve problems that exist in these cities. The people who are experiencing the problems often don't have the resources or ability to solve them. But those in the 'ivory towers' are not in those places with the problems occurring and don't have the awareness — even if they have the motivation to solve them."
That's when he had the idea to start an initiative to try to bridge that gap and bring more entrepreneurial energy to urban areas to solve significant problems. And really the timing couldn't have been better.
"It's a particularly good time to do this kind of thing because of all the new technologies that have come about over the last 10 to 20 years. The internet, computing power, telecommunications…there are many technologies that make solutions possible that weren't possible before. You couldn't have done Uber before you had smart phones and GPS. So those technologies have enabled a solution that didn't exist prior. We can make life better."
To tackle this work, Tarver serves as president of the Urban Entrepreneurship Initiative, an organization he founded in 2014. He is also currently lecturing in the University of Michigan College of Engineering Center for Entrepreneurship, investing in ground-breaking startup companies, advising and supporting entrepreneurs and entrepreneurship programs, and speaking to various groups about entrepreneurship and business innovation.
The lesson he teaches is simple: don't start with an idea, start with a community.
Traditionally, entrepreneurs are taught to start with some idea and then determine if that idea represents a business opportunity. For urban entrepreneurs, they first look to a community they are interested in working with and identify what important problems exist for the population. They find a need before seeking an idea, then go through a design process to identify what the potential solutions are, select the best solution, and develop a business model.
"This is why I'm not big on labeling it 'social innovation.' This is just what entrepreneurship should be. You're always trying to solve a problem for somebody. We have been teaching people to come in mid-way through the process. The first thing to do is go into the community before we ever talk about what business we're going to launch," he explained.
Tarver also works to connect people who are interested in working in this area to share resources, ideas and business models. They also help startups along the way, creating the tools they need to work more effectively. While urban entrepreneurship and standard innovation have some commonalities, there are also important differences that he tries to address in his course material.
His final role is to offer up his expertise to organizations who are looking to develop more business activity like this in their area — hence his visit to Memphis. "I consider coming down to speak to Memphis all as part of that role," he said.