Banking on KC – Joni Cobb of the Center for American Entrepreneurship
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Joni Cobb of Center for American Entrepreneurship: Advocating for Policy That Supports Entrepreneurs
Kelly Scanlon:
Welcome to Banking on KC, I'm your host Kelly Scanlon. With us on this episode is Joni Cobb. Joni was the Founding President and CEO of Pipeline entrepreneurs, where she spent 13 years building a network that helped entrepreneurs with high growth potential, connect to the resources they needed to achieve that potential. Currently, Joni is the board chair and founding board member of the Center for American Entrepreneurship. And we're happy to have her join us now during Women's History Month to talk about her leadership in promoting entrepreneurship in the United States and in particular, women in entrepreneurship. Welcome, Joni.
Joni Cobb:
Well, it's great to be here. Thank you, Kelly.
Kelly Scanlon:
In 2016, the Ewing Marion Kauffman Foundation honored Pipeline with its Uncommon Award for excellence in entrepreneurial programming. And I'm really focused on that word, uncommon. There are a lot of entrepreneurial support organizations and there are numerous programs for entrepreneurs right here in Kansas City and across the country. What made Pipeline different? What made it uncommon?
Joni Cobb:
It had to do with our aggressive initial mission, and then being able to execute on it and keep it going. So to get more into that, what I mean is when we started Pipeline, so it was an idea on a napkin in 2006, with our first-class being in 2007, really, there was nothing like it. The idea of a fellowship, an idea of an organization focused on the founder, the entrepreneur, working on their leadership, their skills, their muscle set, as I always called it wasn't being done anywhere. And so number one, our model was different from the get-go, and we never strayed from that. So we really helped entrepreneurs, not only in their first company, but we ended up helping entrepreneurs in their second and third company by really focusing on that founder themselves. So number one, that was unusual and uncommon. People have since then started catching that wave and doing more of that but we were doing it since the beginning.
Joni Cobb:
And second of all, we were doing it in a part of the country at the time that no one thought of as a really high-growth entrepreneurial place to be. Our focus was not on the scratch startup and the early phase proof of concept. Our focus was on entrepreneurs who are already getting some traction and how can we put some rocket fuel behind those entrepreneurs to really get them going without them at the time, moving to the coast. That was the temptation back in the early years, which was, gosh, you get to a certain round of funding and then they pull you and tell you to move to California, move to Boston. And we want anyone to move, we started originally with economic development funding. The whole point was, how do we keep them here? How do we grow them here? How do we scale them here?
Joni Cobb:
And then I think our longevity in terms of not only keeping the organization robust and growing and pivoting and strong, but also having those entrepreneurs from the very first year of Pipeline, they're still engaged with Pipeline and they're still passionate advocates, but even more importantly, they still lean back on it as they grow, as some of them have now started their own funds. Some of them are onto the third and fourth company they've exited, but they still consider Pipeline their home. And I think that is very unusual. We've had a lot of programs and organizations around the country say, "How do you do that? How do you keep your quote-unquote alums so engaged?" And I said, "Because we don't call them alums. They are members, they are active, they are involved. We create programming for them. They are mentoring others while also continuing to be mentored." So I think it's the combination of those three things that hopefully was the reason why they called us uncommon.
Kelly Scanlon:
And all of the activity that you just described, the exits, starting the second and third and fourth businesses, that had a lot of economic impact. Can you speak to that at all?
Joni Cobb:
We had entrepreneurs over all the world in terms of globally exporting goods. So depending on whether they're a life science company, a consumer products company, a software company, our point was not just about creating entrepreneurs that were impacting our local economy but were impacting a national and global economy in terms of doing business around the world and bringing the economic impact for employment, et cetera, right here in the Midwest. And Pipeline focused on Missouri, Kansas, and Nebraska but let's be honest, we're headquartered in Kansas City, I'm a born and raised Kansas City gal, a preponderance of that impact has been in the Kansas City area. And we're very proud of that.
Kelly Scanlon:
And you're now continuing that work in your position as the board chair for the Center for American Entrepreneurship. So tell us about CAE and the research and the advocacy you're doing on behalf of entrepreneurs there?
Joni Cobb:
So I was super flattered when I got the call to join the founding board of CAE. I was still leading Pipeline at the time. And I was reached out to by the now President and CEO, John Dearie on advice and counsel of Bob Litan, who I think you all might know from his years running the policy portion of the Ewing Marion Kauffman Foundation. He was there for a very long time and had paid attention, like the rest of our peers and colleagues and friends over at the Kauffman Foundation on how Pipeline had stood out. And they had made a goal for CAE that the board would be representative of entrepreneurs or people who work directly with entrepreneurs around the country and not just focus on maybe the more traditional hubs of where you imagine entrepreneurs should be, be that Boston, Silicon Valley, maybe even Austin, Texas, et cetera. They really wanted to sure that people who knew entrepreneurs the way you and I, Kelly, know them. So they wanted people like myself who were working with those entrepreneurs.
Joni Cobb:
And we started in 2017 and the whole point behind it was, and I thought it was brilliant because I thought about this a lot myself, because I had used to work in policy and I went to school and law school thinking I would end up working in policy. And the whole point when I would go and look at things as I'd see these wonderful, beautiful chambers of commerce and things like that represented may be more traditional, either big companies or small businesses, but there wasn't really anyone there spending every single day as I call it stomping around the Capital representing entrepreneurs. And entrepreneurs do not have the funds, they're trying to keep the lights on and they're trying to pay their employees-
Kelly Scanlon:
Right. Exactly.
Joni Cobb:
[crosstalk 00:06:31] But if we, as a nation believe, and I truly believe this, and I believe you believe this, Kelly, that entrepreneurs and the innovation and the jobs and the momentum that they create is critical to our economy, we have to have somebody in Washington, DC, and our state capitals advocating for that. But CAE as an organization spends every single day working on this and reeducating, we get new leaders, we get distractions, people who think entrepreneurship, they don't understand the difference between a small business and a high growth entrepreneur. All of that is a daily effort. And then we get challenges because someone will come out with a new policy, but we look at it and go, "Holy smokes, this is going to hurt us." And so we have to get back over there and explain why they need to carve something up for entrepreneurs.
Kelly Scanlon:
Yep. Those unintended consequences.
Joni Cobb:
You absolutely know it. And so when they said, "Hey, we're going to build an organization." That's what they focus on. And, "Oh, by the way, we're going to make sure that the board is representative of organizations and entrepreneurs around the country, not just in specific hubs." I was all in. And that is why I've remained involved since the beginning of CAE and why I jumped at the chance when they called and asked me to serve as its chair.
Kelly Scanlon:
Well, let's talk about some of the examples of policy or legislation that CAE has either succeeded with, or that's currently in the works more specifically.
Joni Cobb:
CAE was instrumental in creating the first-ever caucuses in the Senate and the House for entrepreneurship. Our work is nonpartisan as you know, caucuses or bipartisan. And so we have been able to start those, help inform them, help support them. One of the interesting things we're going to be doing with them this May, and I'll be going up for this, is we're going to be holding a round table for entrepreneurs of color, what their issues are, what they need. I think that's the most powerful thing that has happened so far is actually helping form those caucuses so that we have a conduit to keep these conversations in front of our most important policy leaders, absolutely.
Kelly Scanlon:
And to hear from the entrepreneurs themselves, I mean, that is terribly important for lawmakers to hear.
Joni Cobb:
Yes. And you'll love this, I think it might have been in '17 or '18, we held a Women's Entrepreneur Roundtable. And that was right when things were really getting, going with the caucuses and Wendy Guillies actually was our moderator for that round table. And Amy Klobuchar was there as well. And I think I had sent at least a couple of entrepreneurs from the Kansas City area there. And it's especially exciting for me to talk about the women's round table that we've held given the fact that it's Women's History Month. And we're talking again about the issues. The issues that we spoke about at this round table a few years ago are absolutely as relevant today as they were a few years ago. And so I'm excited to share a few of those issues with you today.
Kelly Scanlon:
I've seen reports, for example, showing that female entrepreneurs are making inroads, particularly in industries that have been previously dominated by men, like the science and the tech and Pipeline was heavy into those particular industries. So what are you witnessing in that regard? And obviously, anything else that you're seeing of note, share that with us too?
Joni Cobb:
Certainly, I have always been impressed with the quality of entrepreneurial women that I have come into contact through not only having been in Pipeline but the ones who have applied and maybe it wasn't the right time for them or else the people that have also worked with us, the investors or other experts. There's no shortage of brilliant, talented, ambitious women out there. I think what we're finding though, is that our numbers nationally, in terms of opportunity for women where we rank on all those international and national ranks is getting worse. And so we have to ask ourselves, "Wait a minute, we're seeing these talented women, women are understanding entrepreneurship and their opportunities more than they ever have. Why in the world are our international rankings going down?"
Joni Cobb:
And when we talk to them, when we talk to women and I'm sure you've done so as well, we get to some really what I would call basic block and tackle issues. Now separate from this is going to be capital and capital formation, we'll get back to that, but they bring up very basic things. Childcare is a huge problem and when you're trying to launch a business, grow a business, let's not even mention what's going on during COVID with childcare issues-
Kelly Scanlon:
And the homeschooling and yeah. The whole nine yards.
Joni Cobb:
So since COVID, and since all of the challenges, it's just shown the light on it, the problem was there before. It's just that it's so amplified now because everyone has seen the problem on their Zoom screens or whatever screens they have, everyone is trying to deal with childcare. But particularly with entrepreneurship, there's really no solution for many of these women. And so they either don't go into it or they grow at a much slower pace, or they maybe don't run the company. They take a substandard job in that company in terms of their talent and their drive and ambition. And so that is one piece where we're paying attention to all legislation, not any particular one right now, but we're working with any of our policy leaders when they want to address childcare, whether that be universal childcare, any other solutions around that.
Kelly Scanlon:
Are you seeing it, not just as a problem with people who are already entrepreneurs, but are you seeing it as an actual barrier to entrance for entrepreneurship?
Joni Cobb:
We are seeing it as actually a barrier to entrance. And sometimes lots of times you'll run into entrepreneurial couples and somebody has to make the choice. And I think of this in a proud way. I am a mother. I built everything that I built, not only my passion for what I was building but my ability to be there for my children and to provide for my children. And I totally think that women's, the predominant amount of women being concerned about how are we going to make it all work is a wonderful thing.
Joni Cobb:
But that being said, our entrepreneurial numbers in the United States are dropping and dropping. And if we really need every single, able-bodied, talented entrepreneur out there, we're leaving talent on the sidelines. If we need to have them be able to raise these wonderful, fabulous children, that by the way, will be inspired by their mother doing this. If we want them off the sidelines, then we should care whether it not only slows them down, but it may stop them or delay them by many, many years of getting in and realizing their passion and their dream. That's a lot of talent, that's a lot of drive that we're losing.
Kelly Scanlon:
You also mentioned access to capital and funding, and that has been so true for so long. Is it still the mountain to climb that it has always been, or are we seeing progress there?
Joni Cobb:
Well, I think the awareness always leads to progress, correct? I mean, people are much more aware of it now in terms of their diversity and who they're funding, no doubt. Secondly, we're seeing funds and organizations start-up around specifically targeting funding, those types of entrepreneurs, whether it be we're trying to fund more women or more entrepreneurs of color. We're seeing funds and organizations dedicated to that, or at least have a program within their funds dedicated to making sure that they're doing that and that is progress. But I think at the end of the day, what we need are, are more investors that look like a diverse set of entrepreneurs. Investors tend to naturally invest in things that look familiar and comfortable to them.
Joni Cobb:
So the most common route that you'll see when you see a regional fund pop up to invest in on entrepreneurs and the ones we were like, "Great, we've got a new fund. They're going to really help some of our local entrepreneurs." Those funds are very limited into who can be involved, how many people can be involved in how much money they can have. So what we're trying to do is work with legislators to say, "Hey, we would like more credited investors to be involved in this. We would like to increase the number that can be involved in each one of these funds." Because right now I think it's limited to like a hundred people in each fund. What we'd like to see is the section 3C1 exception allow for more accredited investors. So people like the Kellys and Jonis of the world to get involved in these funds and allow more investors per fund so that you don't have to make as large of an investment. Because if you have a fund with 300 people involved, as opposed to a hundred, the amount of investment can be smaller.
Joni Cobb:
And so we can bring in a more diverse set of investors. And so we're trying to solve this problem or address this problem from both sides, letting the existing funds talk about what they're doing to increase access to capital, to women and entrepreneurs of color, but also increase the amount of investors that look like them, that women and investors of color getting more involved, creating more funds, being more involved in funding those entrepreneurs.
Kelly Scanlon:
One of the things that strikes me as you're talking about this is that it's one thing for women to be starting businesses in some of these industries that they haven't previously. And I was curious to know if women entrepreneurs are being successful at moving beyond that startup and in the second stage, which is absolutely important to success. And there's a tie-in to what you were just saying about the funds. If they can't get the funding, they usually can't get to that second stage. But with the work that you're doing, you are trying to improve those odds, it sounds like?
Joni Cobb:
We are absolutely trying to improve those odds. Any improvement that we've seen is clearly not enough. And we're still behind in terms of parody and improvement is great and we should celebrate it. But if there's significant headwinds in scale and growth, then we're going to see a lot of entrepreneurs that are really realizing the dream, be so few in the camp of women and entrepreneurs of color. So we want them to be able to grow and scale and take on that $10 million round that $20 million round, that $50 million round. And those are higher and higher numbers. We haven't seen, I believe, that progress yet that women have that parody and going after that type of money, but we're working on it.
Joni Cobb:
And then in addition to access to capital, women are particularly concerned about healthcare. They're particularly concerned about retirement security and the healthcare and the student debt and the retirement security and childcare, entrepreneurs have to provide those things for themselves all the time. They can't go to work somewhere and they can maybe try to do that side hustle thing that keeps them insured, but let's just admit it, if we had a way for them to ensure their healthcare, they had a way to access childcare, they had a way to participate in some sort of retirement security, not only for themselves but as they hire, you're competing for talent. You don't have an opportunity for your talent to participate, these things slow them down. And men complain about it as well. I'm not trying to say that only women care about these things, but these have come up in our round tables as being issues that are either barriers to entry or barriers to growth.
Kelly Scanlon:
So often entrepreneurs, people, they think of legislation and policy at the federal level. And yes, that has a huge impact, but sometimes even more impact happens at the state and the local levels. The fact that you can't put a sign perhaps out there to advertise your business if it's one that depends on foot traffic if there's an ordinance in place that's going to really impact your business. So, you have to be aware of what's happening locally too.
Joni Cobb:
Yes. A state-local, absolutely. Pipeline was born at the state level originally through economic development funds. And so we were very, very aware. Now through the years, working with different states, we will frequently get the phone call. I said, "What was helpful? Were angel tax credits helped in your state? What are your rules around fundraising?" All sorts of state and local issues come up that they may touch on the federal issues as well. But keeping and getting involved with your state and local officials that affect entrepreneurship, affect business, is critical. Having some of those organizations that can help translate that for entrepreneurs I think is critical. So it's wonderful to hear from entrepreneurs, "This is the type of thing that slows me down." Whether it's bureaucratic issues of starting their companies, things like that, that has come up many times.
Joni Cobb:
But many times they can't really put words to it. And I think that's when you start dealing with people who are maybe raising angel funds or helping create some of the funds in entrepreneurial support systems in the region, they can help translate a little bit for those entrepreneurs, to those policy leaders. These are the things that come up. These are the things that slow them down. So talking with both the entrepreneurs and the support system leaders in tandem, I think is critical for local and state policy leaders, as well as national.
Kelly Scanlon:
How has COVID 19 impacted entrepreneurship? What have you seen there?
Joni Cobb:
I will say that entrepreneurs were far more adept at working remotely and having remote teams. That's a shout-out to my entrepreneur groups that we were all ready for that. But I think specific to this month, given the significance of this month is that there's a lot been written about this lately, the disproportionate impact of the pandemic on women. And they've called this the she-cession, that both not only in the entrepreneurial world but just the regular business world that women have borne the brunt, the lion's share of the brunt of staying at home or having to stop their entrepreneurial ventures largely due to childcare difficulties. So I'm coming back to that childcare issue. If we have learned anything from the pandemic, when it comes to the workforce is that childcare is a screaming need and that we are behind other countries and that our entrepreneurial numbers are running lower than other countries now. We have got to do something to address this. And as you can imagine, that will be a primary or very important, new initiative of CAE in the coming session.
Kelly Scanlon:
Yeah. And taking that even further with women out of the workforce, that's impacting entrepreneurship because the labor pool shrinks even more then. And so to get the talent that you need to keep your business going and to expand just gets harder.
Joni Cobb:
Yes, we've got to do this not only for founders of entrepreneurial companies but for the critical staff, the critical C-suite the software engineers. It doesn't matter what you are looking for. Women are a huge percentage of that workforce and they are being dramatically impacted by the pandemic and childcare.
Kelly Scanlon:
Joni, let's talk about you for a minute. How did your career path lead in this direction to the work that you're doing with entrepreneurs?
Joni Cobb:
So some of it was by accident.
Kelly Scanlon:
Not a surprise.
Joni Cobb:
Yeah. It's kind of a full circle time for me in the sense that I went off to college and law school, thinking I was going to go to Washington, DC, and get involved in policy or work at the United Nations. I had all these dreams about it. And I came to Kansas City and worked for a firm for a while. Things happen, you get married, you have children, and all of a sudden you're making other plans. And so rather than moving to Washington, DC, I decided to start working as much as I could in the public realm. And I was doing a lot of investigation and consulting to find my way. And I had landed into an opportunity, very coincidentally, I was volunteering to be on an economic development board in Northeast Johnson County. And I'd met the CEO of KTEC that was getting ready to launch the life science initiative for this state. And so they brought me on as a consultant. And so it just grew from there.
Joni Cobb:
I helped the state in many different ways. I wrote some speeches for the governor. I did a variety of things as I was experimenting. And one of the things they asked me to do is be part of a round table discussion, a very closed-door discussion about what more we could be doing to help entrepreneurs. And the idea got thrown around to have a fellowship. And they said, "Wow, this sounds really great, who could run it?" And everyone in the room looked at me. I said, "What are you talking about?" And so I did what any good lawyer slash policy person does, I researched. And I said, "I'll do this for a few months." Which I think all in all, when I finally finished was 14 years later, I said, "I'll research it." I went to the Kauffman Foundation, of course. I mean, look where we're located to go research something like this. And they were incredibly helpful and brought out stacks of things for me to read.
Joni Cobb:
And so I ended up creating something basically out of my own research, but also my own personality, which you'll have to ask the entrepreneurs what that means. But it usually involves a lot of cookie-creative things. Family was just always my number one thing. And so I don't know if it was purposely or not, but created a culture around Pipeline that was very family-oriented all the way down to sometimes arguing with each other about things. And so when you create something of your own personality and culture and people are so passionate about it, you end up staying in it. But I think the big surprise for me is, in the process, I figured this was my tribe. I was an entrepreneur and I had no idea. And so I stayed and I stayed longer than three months, Kelly.
Kelly Scanlon:
No question there. You were an accidental entrepreneur, like so many entrepreneurs are, it's not uncommon that's for sure. And the entrepreneurial community is better off for it. And that Pipeline family that you speak so passionately about would definitely agree with you. Let's talk about your approach to leading change, Joni, you have been in a position to work with individual entrepreneurs to help them grow their companies, you created and built Pipeline and that takes leadership. You have to get people to follow you. You can't do it all by yourself. So talk to us about your approach to leading that kind of change?
Joni Cobb:
Wow. So yes, I think that's the part that can sometimes be very scary, but I feel as passionate about that concept as I do the whole building of family and maybe it's the same thing. But my approach to leadership has a lot to do with surrounding yourself with and staying very pure to being around people you trust, love, and respect. And the love sometimes comes later, for many, many years I could tell you, I love many of the people around us that helped build Pipeline, but that trust and respect and staying really true. And that's sometimes really hard to do. You might get approached by a fund or someone that wants to get involved with your company. And other people have made different choices than I would. So my approach might not be for everyone, but I tried to stay true always to that integrity of the people involved with Pipeline.
Joni Cobb:
In addition, working with your board, I treated our board as part of my leadership of the organization. And so that was a very important piece to me. And then, in addition, leadership is I believe shared. So one of the reasons why I think Pipeline is doing well with me gone is to have other leaders come up from those entrepreneurial classes or come up from the advisor side that I could see were believers that shared those values that shared the integrity that really believed in what Pipeline is, giving them a platform to speak from giving them a role in the leadership, giving them an opportunity to make decisions.
Joni Cobb:
So those, I think, are my really three top of mind pieces, which is leading with integrity, but also ensuring the people around you share that and being willing to make hard decisions, and then being super transparent with the other people who are helping you lead so that they're never surprised and they believe in you and they trust you and then bringing others up to share in that leadership so that your organization is safe or your effort is safe once you exit.
Kelly Scanlon:
Joni, you've certainly made an impact through your work with entrepreneurs and you're continuing to do so. And what strikes me is that it's nearly impossible to calculate that impact really, that ripple effect of the entrepreneurs you've worked with, who have created opportunities for employees, wages for families, taxes that help support the economy, I could go on and on. What message would you leave to our next generation of female leaders about creating impact?
Joni Cobb:
My message for female leaders that are fired to create impact is if there isn't a path that you see that you can follow, don't be afraid to chart your own. Because frequently some of the most innovative, helpful things are an alteration, brand new way to look at it and what you're bringing to the table in your innovative way to lead and make an impact may just be the absolute special sauce that we need. But we're all put on this earth to share our special sauce. And I think many of the things we did with Pipeline were new and different and sometimes raised an eyebrow, but they're the things that made us quote-unquote uncommon. And so don't be afraid to chart your own path and do things a way that maybe haven't been done before. But in the meantime, definitely do what I did get on the plane, or the proverbial plane, your Zoom or whatever, and learn from folks that really want to share with you because there are a huge number of people out there that would gladly share with you and watch you succeed and want you to succeed.
Kelly Scanlon:
Well, that's so true. And just as you are doing today on this episode of Banking on KC. Joni, thank you so much for your time today. Thank you so much for everything that you have done for the community that you're now doing on a national level for entrepreneurs as well. We really appreciate all of that.
Joni Cobb:
Well, thank you.
Stephanie Siders:
This is Stephanie Siders, Managing Director of CC Capital Advisors. Thank you to Joni Cobb for being our guest on this episode of Banking on KC. Joni has been one of Kansas City's strongest entrepreneurial advocates. Her work in building the Pipeline organization laid the foundation for success for many of Kansas City's most well-known, high-growth companies. Her leadership in this area has strengthened our regional economy. Joni continues to support entrepreneurship and her role as the board chair of the Center for American Entrepreneurship, where she helps create a policy that promotes new business formation, survival, and growth. As a woman business leader, Joni has especially championed female entrepreneurs and worked to clear hurdles that are unique to them. As we celebrate Women's History Month, I am especially proud to be an entrepreneurial mentor for the Pipeline organization Joni built. Like Joni, Country Club Bank recognizes entrepreneurs are the backbone of the American economy, and we welcome the opportunity to work with the entrepreneurial community to build successful, impactful businesses. Thanks for tuning in this week, we are banking on you, Kansas City
Country Club Financial Services Incorporated doing business as CC Capital Advisors, Member of FINRA, SIPC. Country Club Financial Services Incorporated is a subsidiary of Country Club Bank.