We have been working with a number of governments and cities over the past few years, so we are always interested in what we can learn from others. The NYCEDC together with Lower Manhattan Headquarters (LMHQ), a Lower Manhattan co-working space, hosted a discussion called “NYC Gov-Tech Startups: Making It Work.” While we are well aware of NYC’s assembly of “hyphen-tech” industries, this is one we were not aware of: Government-Technology.
The discussion featured Jon Ende (@seamlessdocs), Sascha Haselmayer (@CitymartTeam), and Aileen Gemma Smith (@vizalytics) on how startups can work successfully with governments. Here are the five things we learned.
- Policy makers are changing: Only problems that you name can be solved.
Political leaders used to hide problems for many good reasons. However, increasingly they have realized that only the problems that are openly discussed can be managed and solved. So, mayors and their city administrators have put their challenges out there and enabled various groups to help solve them. This is likely to continue, and provides the biggest opportunity for change and for startups with city solutions.
- City leaders are no James Bond.
Safety, reliability, and compliance still guide most decisions by city administrators. “We once offered a solution in one day and the answer was ’no, in one month is fine,’” said Jon Ende. The famous line in sales training “ABC – always be closing” needs to replaced be with “always be communicating.” Regular and long-term engagement with city officials is more important than fast selling. “We had to install account managers, because we weren’t communicating enough,” Ende continued. Especially with government contracts, an engaging incumbent is hard for newcomers to beat.
- Regulations vary greatly. Regardless, never work for free.
Procurement regulations vary from town to town and what might be a normal question to ask in one city will ban you from the process in another. The regular RFP process will usually not work for startups. “We were coming through the windows and back doors as the ‘RFP front door’ never worked for us,” Ende said. He explained that offering free pilots was a bad idea. “By now we know that selling a pilot takes as long as selling a regular project – no more free pilots.”
- Talent management is the hardest challenge, but gov-tech startups have a leg up.
Finding the right people and developing a high-performance team is hard. Gov-tech companies are no different than others in this. However, in talent management, B corps punch above their weight. “We employ a disproportional amount of smart and qualified people,” says Sasha Haselmayer from CityMart. CityMart competes with the world’s best companies for people and get hundreds of applications for one opening.
- What is the #1 sales argument with governments? Empathy!
Probably the most surprising point in the discussion was the importance of empathy in working with local governments. “You have to be able to listen to their problem and then work hard with them on a solution. Empathy is critical,” says Aileen Gemma Smith of Vizalytics.