When you’re thinking of taking a big risk, does your mind immediately think about all the reasons it could fail? Or do you think about all the ways it might succeed? That was one of the questions entrepreneur and investor Steve Case, Chairman and CEO of Revolution, and co-founder of America Online (AOL), asked at Koch Industries’ March 13th #KochDisrupt Fireside Chat in Wichita, Kansas.
Moderated by Jason Illian, managing director of Koch Disruptive Technologies, this series of discussions with key business leaders and trailblazers from across different industries is an extension of Koch’s knowledge-sharing culture – a way to share innovative ideas and business principles with both employees and the public.
For Case, who got his early professional start in Wichita, it was a homecoming of sorts. In fact, it was in Wichita where Case bought his first computer and first got online, an experience that would ultimately fuel his passion for developing the future of the internet.
Here are some takeaways from the discussion:
Working with restaurant franchises led to finding innovation in unexpected places
As the director of new pizza development for Pizza Hut, Case would often drive around the country eating at independent pizzerias to see what the competition was doing, and it reinforced his notion that “the best ideas are probably someplace else.” Today, through his Rise of the Rest seed fund initiative, Case hopes to find and invest in great ideas and great founders outside of New York, Boston and Silicon Valley.
“I said, somebody somewhere in those 50,000 restaurants is doing something interesting. [So] rather than sit here in my office, why don’t I hit the road?”
We are in the “third wave” of the internet revolution
It began with the infrastructure of the internet (the first wave) and grew with the software (the second wave) – the Facebooks and Amazons and web entities that built on that infrastructure. Now, we’re in the early innings of what Case calls the third wave, where disruption will continue to redefine major economic sectors like transportation, agriculture, education and health care.
“In the third wave … the partnerships you need are in the middle of the country,” said Case. “Health care, hospitals, insurance companies are predominantly in the middle of the country. If you want to revolutionize farming, what we call ag tech, Manhattan (New York) is probably not the place to do it.”
The greatest talent is not always located where the greatest capital is
While Silicon Valley attracts talent as a “creative community that is fearless, takes risks and imagines what’s possible,” nearly everybody there is from somewhere else, attracted by capital and the opportunity that capital creates. It’s a big reason why Case created Rise of the Rest.
“The data here is shocking to me, that last year, 75 percent of the venture capital in this country went to three states: California, New York, and Massachusetts. California alone, 50 percent,” said Case. “California is awesome … [but] 50 percent of the smart, creative entrepreneurs are not in California.
“There is an opportunity to redistribute innovation more broadly around the country and have it less dominant in a few places.”
The best ideas often start out as crazy ideas
Not so long ago, getting into a car with a stranger or renting someone else’s house on vacation might have sounded ridiculous. But today, Uber has completely disrupted the taxi industry, while Airbnb controls more “rooms” than Hilton and Marriott combined. According to Case, “All the great ideas started out as ideas that sounded ridiculous,” so he encourages people to step back and err on the side of being more disruptive and innovative.
“When you hear a startup pitch, does your mind go to why it might fail, or why it might succeed? … The next time you hear a pitch, imagine what might be possible.”
America was once one of these startups
Viewing U.S. history through an entrepreneurial lens, America began as a startup and is a comparatively young one that almost didn’t make it. But entrepreneurs helped build the country into what it is today, just 250 years later.
“If you look at the backstory there, all the cities in this country were built by entrepreneurs who created companies and then created industries. Sometimes they were based on where core natural resources were. But every part of this country was basically built by entrepreneurs taking risks.”
Email was an “idiotic” idea that was never going to catch on
It’s easy to forget, but just like hitching rides with strangers and renting out their homes, the idea of email supplanting phone calls or snail mail was once considered ridiculous. But look how pervasive the phrase “You’ve got mail” eventually became.
“Going back to … the early days of AOL … most people thought the idea of email was crazy. Why would you sit at the keyboard and type a message to somebody when you could just pick up the phone and call them?”
Editor’s note: If you reached this story from your inbox, that crazy email thing seems to be doing alright.
See more of Steve Case on 60 Minutes and Axios.
Catch up on the last #KochDisrupt Fireside Chat with Joe Lonsdale.