In this very first episode of the Government to Business podcast your host, Gavin Atkinson, introduces the show before interviewing John Keisler, Economic Development Director at the City of Long Beach, California. John is leading the digital transformation of the city's service delivery to business and entrepreneurs.
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Government to Business podcast intro
Gavin: G'day and welcome to the Government to Business podcast, my name is Gavin Atkinson, I'm just so pleased to be bringing to you today the very first episode of a podcast that I've been wanting to do for a very long time now.
What am I trying to do? What am I trying to achieve here? What's the purpose of this podcast? Look, put simply I want to serve you. I want to help inspire you with the stories of other government leaders around the world. I want to help you grow as a leader so that you can deliver some truly spectacular benefits internally to your government organization and to the businesses that are local and in your jurisdiction.
Essentially I'm here to help you transform your Government to Business digital service delivery.
So, why does it matter? Well if you want to reduce the cost of government you should care.
Transforming your service delivery achieves channel shift, and by getting the right strategy in place you can, absolutely save money. That's a fact.
But it's not just government that can reduce costs. I've seen time and time again businesses saving time and money all from well-planned and executed Government to Business digital transformation.
But what else is possible? If your department or agency delivers against your customer's expectations, you'll better help them start their business and grow. Not only does this help make for more satisfied businesses, but if they're growing they're also employing and job creation as we all know is the key means to building a strong stable community.
So what's this podcast all about? What do I hope to achieve? Well every week will be a little bit different but essentially what I want to try to do is highlight best practice and look at contemporary issues and trends that are impacting the digital channel.
I'll be conducting interviews with executives just like yourself, who are delivering government to business services. I'll concentrate on what works for them, the challenges that they've had to overcome and also give you the best practice examples from them that you can learn from. Now, things will vary and I'll probably try to get one of these out every second week but maybe I might spice it up, and maybe it might come out every week. Those episodes where i'm doing interviews they'll probably go for around, about 30 minutes to an hour and the very first interview is actually going to be on in a couple of moments so stay tuned.
In the weeks between interviews or when something kind of occurs that catches my eye and I feel, you know I'd like to spend some time talking about that; I plan to have a much shorter format show. That'll be a little bit more thought leadership based more high-level and inspirational so if something's occurring that I think, “Oh, that's really bad practice,” and I want to be able to highlight that, so that you don't make the same mistake, I'll do so. Same time where I see some great stuff occurring around the world being delivered by governments for business
I'll be highlighting that too. And of course any stories or anything else I've heard that I think, “Yeah that would be really, really useful for you as an actual government leader when it comes to Government to Business service delivery.”
So these are this my initial thoughts, and I want this really to be about you. I want to be able to deliver immense value to you.
So, to do that I need to know, what you want. I need to know what would be interesting for you, what you want to learn. So please drop me a line at firstname.lastname@example.org or you can connect with we at Twitter at gov2business, that's with the number "2" for that one, or of course find, me on Linkedin.
Importantly as I said before I really, want to know, what you,want to have covered in the show and the ideas that you have on how I can improve things to make it more relevant to you.
So that's about the podcast. Now a little bit about me and a little bit about why i'm doing this. At a personal level I am a father with two teenage children, a son of the daughter who are coming to their final years of high school education and on top of this I have a wonderful loving wife of almost 23 years, so I'm going to keep that going. As you can tell from my funny accent, obviously I'm Australian. I currently live in Australia. When I'm not doing this and I'm basically trying to keep myself entertained with other activities with my kids and that often involves camping, getting outdoors and also from my point of view I like to keep physically active as well.
So why am I doing this? Look I've found that over the years because I've been in the space for many years now, I've tended to concentrate my efforts and help governments when it comes to their service delivery but it's ultimately in just one location and I really want to make a bigger impact on the world to be perfectly frank. When I'm doing what I'm currently doing, it is very much focused around one location and one location only. Over the years I've done that obviously when it comes to Australian governments and also in the United Kingdom.
But I can see so much more opportunity that's out there and I really want to help governments globally transform your digital service delivery to business so that's how I think I can help make a difference through this podcast and also the website that I've established at governmenttobusiness.com
I want to try to ensure that government leaders are able to improve the way they're able to deliver their services to their local jurisdictions so that they can make truly powerful changes in the lives of others. You see by empowering people to be able to start and grow their businesses, those business owners will be out there in your local community employing people and when jobs are created locally like this it helps build a stronger and more stable family environment and stronger and more stable communities. And look, that's something that I think is a really fantastic mark to leave on the world so that's what I'm trying to achieve here with you today.
So this podcast and the Youtube channel, I can't forget about that, if you look for Government to Business you'll find that one there too, is my way of helping achieve that.
That's my initial thoughts of where I see things going here at the the very beginning of episode 1. So join me every week as I cover a different topic about Government to Business digital service delivery. Ok, so that one's the opener that's done that's out of the way. Now it's time for my very first interview with John Keisler.
So John is the director for economic development at the City of Long Beach in California. In late 2016 John led the development and the delivery of BizPort, the award-winning one-stop shop for businesses in Long Beach but as you'll, no doubt find out as we explore in the interview he hasn't been resting on his laurels. In fact he's really done a lot of hard work to continually improve the service delivery offering that they're currently doing for Long Beach businesses. It's a great story so enough of that. Let's get straight into my interview with John Keisler from the City of Long Beach.
Interview with John Keisler, City of Long Beach, California
Gavin: Thanks, very much John for joining me today. I'm really, really interested to talk a lot about the Long Beach Business Portal. You've been very successful obviously with the Center for Digital Government allocating yourself a winning role in the Government to Business category late last, year. Can you, tell us a little about how you lead the city's vision with BizPort and a little bit about yourself?
John: Absolutely, thanks so much for today and for including me in this yeah so my name is John Keisler, I actually am the economic development director for the City of Long Beach. We're a city of about a half million people in southern California. We are on the water, the Pacific Ocean just south of Los Angeles and we have a really, dynamic and diverse community that is seeking ways to position our workers, investors and entrepreneurs in the new, economy so that they can be successful.
Our job on a day to day basis in the department we say is is ultimately to help, you make more money. And so if you meet us, if you're a resident of Long Beach or you come to Long Beach looking for economic opportunity, our goal is that if you reach out to us that a year from now you'll be making more money than before we met. So, you know when we look tools that can help workers, investors and entrepreneurs to navigate the opportunities out there
BizPort was one of those that came out of our interviews with people, who have been displaced or people who after the recession maybe had lost their jobs with companies, and were coming back as independent contractors and they may have had a range of skills they could be good at. You know creative stuff or they were in, maybe they made things or maybe they were a consultant but they didn't necessarily have a lot of experience running a business that, was something that, was new to them and so, so you know the theory behind BizPort, was that if we could make the very complex process of opening, starting or growing your business in the city, if we can make that easier it was a way that we could help people to turn their skills into money and ultimately economic opportunity and so just as an example when we started this investigation talking with people about the process of starting or growing a business we found out that for a restaurant that had alcohol and entertainment and food and all that stuff that they may need as many as 26 different licenses or permits to open a brick-and-mortar restaurant in the City of Long Beach, and that sounds crazy, but that's actually common that you know for a chef who may have these skills to make delicious food and create really cool, experiences and places for people to meet and eat, you know they have to go through a very complex journey and they may interact with as many as a dozen different government agencies along the way.
So BizPort was really an attempt to map out that process, you know in what we call a user
design process where we we built the tool around the journey of the entrepreneur so beginning with the resources that they may tap into for business planning and financial planning and getting a consultant even before they actually apply for a business license and so what we learned from our users was that they needed help with site selection, finding a space that was zoned properly.
Things that you might you have to pay a consultant for they were able to do just through the tool itself and then of course, as they move through the process of applying for a license or registering their business, that all those different steps along the way were accessible to them in the order of their journey regardless of business type or what agency they have to interact with it was all laid out for them and in a nice road map.
And so that that was the basis of BizPort’s user centered design and in leveraging technology like a mobile phone and a website to map out that process. And from there we learned a lot more along, the way.
Gavin: Excellent so to be able to go through that exercise of speaking to business owners and people who are looking at, or more particularly people, who want to become a business owner and what their challenges and their issues were; There, that's the type of thing that you could get a really really long laundry list but it sounds like you were quite targeted with the way that you approached that. How did you prioritize that to make a decision around what are you going to get out as part of an initial iteration, and then building on that from there.
John: Yeah, that's a great question and you know this is where the the the City made a significant shift in the way that we built this application, so and this is this is one of the things that makes BizPort innovative for the City of Long Beach so first and foremost we used a very, very incremental approach and what I mean by that is that we actually built the website in real time and we didn't spend a bunch of time you know and a bunch of months interviewing people and building something in secret and then launching it all at once. Instead first of all we engaged Code for America which is a civic tech company and we had them on site meeting with entrepreneurs and people in the community that serve as business navigators. People that may be directors of business improvement districts and staff who are on the regulatory side and we learn from them what the most common opportunities and challenges there were that entrepreneurs face.
Number two is we got a straw man or a prototype up right away so within the first couple weeks a website launched and it was very basic but it gave a piece of clay for the users to work with and to shape and reshape so they, were active they're very active in the design of the tool, from the very start and we didn't, we took some risk in that, we wrote it in first of all a language called Ruby on Rails, which we'd never written, which is an open-source technology.
We also put that up on, live on web and it was available to anybody to comment on and to provide input and that was a real risk for us because typically you know as a government
we hire a consultant. They have maybe a proprietary language or a proprietary software with a closed system and maybe they they spend months and months and months building it and then
unveil it and hope that it meets the needs of the users. Instead this thing was built and in each day there were improvements made, code was a you know, updated and adjusted and people would actually even weigh in with other applications that you know might be able to tie in or plug into the application itself and so by building it out there in the public I think it was a bit risky but it really built momentum because the people, who were participating and in contributing to the process they were very excited because they got to see it evolving in real time and it wasn't something that, we just talked about. It was something that they got to shape and then they got to see that how it responded to their input on a day-to-day, week-to-week basis.
Gavin: Excellent, you actually touched there around that whole nature of providing that code source and building off an open source environment. You obviously are very very much aware that in the last month or so the City of Minneapolis has gone live with their own business portal, which looks remarkably similar to the the City of Long Beach and has a number of functionality and components, which you know are identical. But then, they've got their own different approach when it comes to content and information architecture and so forth.
What was the actual rationale to take that really open approach to sharing and making this, you know, the actual code base for the application available so that other governments could do the same?
John: Yeah, well that I'm glad you brought that up so that was another really innovative piece of this process for us so user centered design, you know engaging with the user and having them drive development, the sort of open process by which it was developed as a prototype, you know, live. But the third thing was making sure that, we put the code out there in GitHub for anybody, to use and and there's a couple of reasons, why, that's important.
Number one, from a sort of a public service standpoint we want you know, to be able to share, lower the cost of government innovation so that other governments can go out there and grab the code they don't need to pay for anything maybe the only cost that they have really is for either a designer or a programmer to go in and modify the code for their unique needs and their unique process so that was one thing.
The second thing though from a self-interest standpoint, is that this model of having an open source or an open market where you know, you can put code out there and then we can, also, grab code so if Minneapolis comes up with an innovation and they put, some money and time into evolving the tool because they've been able to identify an improvement we're the beneficiaries because they're gonna put that code right back out or modify our code in a way that that that helps us to evolve and that is kind of the more organic way that you see innovation happening now in these open-source platforms. So just like you know in the old days, maybe Apple would be an example of a company, that you know built their hardware as well as their operating systems in a closed, way so they maintained control of their intellectual property, and that was a profitable way of doing things, you now see companies, who actually build platforms for you know content like Facebook or Google, which actually leverage the content that's generated or developed and the applications that are developed as plugins to their platform and so we're really taking that approach as government with, this particular application to create a platform by which the market and the creativity of others can help to evolve you know, the content, the architecture and then the code and then in doing that we're all the beneficiaries of that that creative marketplace.
Gavin: So, this should obviously, be some benefit coming through from yourselves as you, said, there's more and more city governments and state governments, kind of approach that and start, you know, expanding on that so it's a fantastic initiative. I think it's wonderful. This was all part of the initial Bloomberg Philanthropies Mayors Challenge, is that correct? Is that what kind of kicked off the the kernel behind the project?
John: Yeah, so we were the recipient thanks to you know, the leadership of our Mayor and our City Council back in 2015 the City received a Bloomberg Philanthropies innovation grant. So the Mayors Challenge is something that Bloomberg does around their specific project but the Bloomberg innovation cities, what these teams do is that the funding from Bloomberg helps to pay for a team of individuals that may not have any experience working inside city hall or inside government, people with backgrounds in Long Beach for instance.
We brought in a designer, we brought in a cultural anthropologist, we brought in a programmer and a data scientist and what we created, was using the funds from Bloomberg, an innovation team, and so the innovation team was responsible for investigating and then identifying potential solutions for reducing economic disparity in the City of Long Beach.
Particularly looking at the way that the economy had been changing and the way that the tools that were available to city governments were also evolving, with the elimination of redevelopment and some other things that had changed in the California Legislature. So, yeah, the BizPort tool was just one of many initiatives that the innovation team launched from that Bloomberg grant and we've actually started to implement almost two dozen various initiatives that flowed out of the recommendations of the i-team.
Gavin: Wow okay, and that's obviously a very discrete amount of funding and that funding has now ceased. I'm assuming that there's obviously, some significant outcomes and benefits that are being delivered by BizPort for you know, Long Beach and your Mayor to kind of continue to actually fund that team and also fund the work being done by yourselves within the economic development space.
John: Yeah, absolutely, so there's actually a number of really interesting benefits. I would say one of the things that we're really really excited, about is the economic development blueprint that evolved out of the i-team's work and part of the, part of the thing that you know really, was driving the need for a plan. You know it was that so many changes were happening in the economy. The recession had been really significant throughout the country but also in the sense that cities were trying to identify the role that they would play in the economy and in how they might position their residents and their workforce to compete.
And so a couple of things that we had recommended as part of our initial investigation to identify where it was that the city could have the greatest impact, was really to develop an blueprint for economic development which was a community-based process. We did about 26 different community meetings with our Economic Development Commission of developers and you know, housing advocates and entrepreneurs. Different people that represented sectors of the economy to develop basically 82 recommendations divided into seven different focus areas and so the blueprint for economic development, it was adopted back in April of 2017 and it lays out a lot of the recommendations, the objectives and ultimately the focus areas that our City Council and our City is now investing in to move the City forward economically for workers, investors and entrepreneurs.
And so I encourage people if they're interested to go to our LongBeach.gov Economic Development Department and download the blueprint to take a look at some of those recommendations but we're very proud of that because it is community, it was community driven. It was not written by a consultant it was written by the outcome and the ideas from those study sessions that we conducted and now we've immediately started driving into implementation and I'm actually looking at the the schedule of about 19 initiatives that are currently happening this year already launched into implementation and so you know the i-team, what I think probably was the biggest impact from the grant because the i-team has now moved into what we're describing as our public safety challenge just this week they launched, what's called the Long Beach Justice lab and that is a again a data-driven approach to identifying ways that we can help high utilizers of the public safety system to divert them to support services and resources rather than putting them in jail.
And that justice lab actually there was a public announcement of it by our Mayor last week at the State of the City and then rolled out through the press this week, so we're very excited about the i-team's work in that area.
Gavin: Fantastic. When you have that consultation and you develop up that relationship, I guess with the economic development community and you're getting that type of feedback saying, “Hey, we're interested in Long Beach delivering this, this and this,” when that kind of cuts across different bits of municipal government how do you kind of address those challenges and bring on board other parts of the actual government in that journey to deliver and improve the customer experience online?
John: Yeah, so speaking specifically to you know BizPort as the example, you know what was interesting was that the regulatory staff that are responsible for many of our of our governmental agencies, they really want to be able to say "yes". They really want to have and provide a good customer experience even though their their job or their responsibilities may be to regulate business or to approve safety standards for construction.
Their goal is to make the transaction as easy and quick as possible and while still ensuring you know safety and compliance. And so what we found was that, you know, from their perspective if there was ways to reduce the workload, if there were ways to prepare applicants to be successful that our partner departments and agencies were very much on board and it wasn't that, we were coming and saying, "Hey, we want to improve customer service because it's the right thing to do and you know we should all strive to make it easier for the customer." Instead it was really asking you know government agencies, "What is it that we could do? Or, what is it that we could help the customer with that would make your job easier? If every customer came in with you know, the right answers and with the application filled out with all the requisite paperwork if they were to apply for say an inspection and they were to provide the correct information the first time. If we were able to help you map that information and if we were able to help you eliminate errors?"
I'm going to give you one example. So, one of the tools that came out of BizPort was the point at which you need to apply for a business or an inspection of your business so let's say you did an addition or put in a new kitchen.
What was happening, was that the old system was basically a manual process and it was phone driven so you called in you left a voicemail and you could leave a voicemail in up to about 3 p.m.
each afternoon, and then those voicemails up to that time the next morning at, about 7 a.m. as people would start, as technicians would start to listen to those voicemails and there's about 150 of them a day, and they would hand write out in their requirements and the address and what kind of inspection. And then they would have to map them manually on a large map and then they would have to take all those cards that they had created, from the voicemails and sort them and hand them out to the inspectors…
Gavin: This sounds horrible
John: ...who would then would go out that day. Well therein lies the the opportunity so anytime you find a process that might be manual or might be horrible as you described on, you have an opportunity to gain a partner and so from an innovation team's perspective it was looking for that pain point, that manual process. And so lo and behold, we worked with Code for America and
created, what was called Inspector Gadget and to you know their credit,the department, who was responsible for these inspections, was was very excited because we were helping to address one of their concerns and about 9 hours of work a day were eliminated and what happened was, Code for America helped to develop a very simple online drop-down menu whereby somebody could apply for or submit an application for a license inspection or a permit inspection any time of the day. That information, their choices were forced in terms of what kinds of inspections would you know, they needed a, you know, to put in the address properly, it was auto mapped, using Google Maps. It was then auto scheduled for, because you used algorithms to schedule the appointments to certain inspectors within certain zones and it just streamlined the process and eliminated a lot of unnecessary mistakes.
Well in the end we also developed through that process a really, good relationship with that particular division because, we were solving their problems, we were helping to improve their life, and through that small win, we were able then to develop a relationship to go on and conquer bigger challenges. In the process the life was made better for the customer and I even had one of our high-level government employees call me, you know a couple weeks ago, and say "Hey guess what I just used Inspector Gadget for my own home permit inspection and it worked great." And so as a result of solving an internal problem with our regulatory agency, from a process standpoint, we developed a great relationship with them we were able to tackle bigger issues and as a result, we also got a better customer experience.
Gavin: Great, I mean the thing that I find actually really interesting when you've been talking a lot John around what BizPort delivers is it is well and truly going towards that, whole you know one-stop shop if you're a business intender, you want to start a business or you already have an existing business within Long Beach you can pretty much do almost everything within the site.
And I've noticed in recent months there seems to be a lot of government agencies who are, you know, really focusing just on one area like an actual niche and just focusing on that and not looking at the bigger picture when it comes to the overall customer journey. What are your thoughts on that? Why do you think, you know, why did you intentionally take obviously that path of trying to bring everything all together into you know, a single integrated offering for the customer?
John: Yeah, well that's you know in the terms of design, you know, that one of the things that you want to make sure you do is you, want to give, you don't want to overwhelm people. So you want to make sure you're providing information that's relevant to any user, you know, in the journey, at the right time in the journey but you also want to make sure that the resources, you know, it's a small enough bite that you can, chew and so the accordion design, you know, with planning and then applying and then growing your business was meant to break it up into three key phases that we thought most of the entrepreneurs would face along the way.
The second thing is that you don't have to look at everything at once, but you know, they could use the drop-down accordion style to look at the stuff that they needed to, but then they also had a sense of what was ahead so you know, one of the challenges what we faced as a city was that if you needed to get your business license you, went to the financial management
organization webpage. And you were in financial management and you were really in some ways you, had just the information you needed to navigate that piece of process. The problem was that after you started the application for a business license you may have to go to eight different departments. You would have to go to the health department to get a license or an inspection, the fire department, the police department for entertainment or you would have to go to planning and building and all of these different departments had their own website so there was a different style, there was a different, you know, format or structure. If you could find the right site you knew which site to go to next, you then were in their world.
What we tried to do was, we tried to dumb down the language, non-technical language. We tried to create a very simple style and format. Everything translates through the Google translator so that it's in about six or eight different languages that were commonly spoken in Long Beach. It also had chat.
So the chat function down in the bottom right corner with intercom, was the first time the city had ever used online chat and we wanted to test that because we had heard from a lot of the entrepreneurs that, "I know I have to get these permits and licenses and go through this process but oftentimes I don't know which one to go to, in what order and when I, when I get stuck it's really hard to get unstuck and I have to make multiple phone calls and many of the departments don't know what the other department does. They know what their process is, they're experts but they don't necessarily know, you know, what's next for the entrepreneur."
So the idea was if you could from start to finish from, you know, your very first idea, your very first mentor or consultant or business planning process, if you could click through very quickly and see that, hey there's a lot, you know, involved over the course of time but I'm just going to take it one step at a time and if I can ultimately from the regulatory side, if I'm in the fire department I know, what comes before, you know, my step and what comes after, we could really improve the sense of awareness about what, you know, the entrepreneur was going through from the government side and we could also improve the interaction from the customer side about what's coming next so that they can anticipate and not get too excited when they completed, you know, one step but not also become overwhelmed because of, you know, not having the right expectations, about how long it might take.
And not make commitments financially and otherwise, don't sign that lease until you need to because anytime you're carrying costs, when you're trying to start your business you're losing money and anytime that your process is longer than it needs to be as they always say time is money and our job really was to reduce the median days to approval because time is money and people, who save money can invest that in successfully growing their business and hopefully surviving at a higher rate than the national averages. So there's a lot of reasons for thinking about what happens before and keeping people from applying or signing a lease or making an investment until the last possible minute. There's a lot of benefit to doing that to help them with surviving at a higher rate than they might, you know, in other places.
Gavin: Okay, looking around there's still, we see a number of Long Beach municipal websites that are still out there and I guess they kind of cross over a little bit between the citizen view and a business view. So like, there's the Long Beach development services as an example, where I'd imagine that, you know, they'd be kind of dealing with both citizens and businesses. What's the overall strategy I guess at the city level for how to approach service delivery when it comes to that dichotomy between citizen and business?
John: Yeah good, good point. So first and foremost I think we're sort of in nascent, in the infant stage when it comes to really, really understanding the right architecture and the evolving needs and expectations of users and technology.
We're learning a lot, and we've been trying to improve, you know, consistency through our website and using a style guide and all that to really improve the experience that a customer has to make sure that it's consistent and that you know, it's familiar, and that the information is easy to understand because you don't have to adapt to the very different presentation of information that you might find across different agencies. So we're all aware that we're in the early stages particularly with you know, BizPort and with our website.
With BizPort specifically I would say that we made a decision initially to only, what we call, link out to information.
So, we weren't going to go in and we weren't going to try and convince every every other agency we interact with that they needed to change their website and their content, we were simply going to be provided an aggregator tool that would provide links to the various resources that people need, and that our hope was that if this was considered phase one, by aggregating that information by creating you know a one-stop shop, a clearinghouse for all the resources that an entrepreneur would need, we would then be able in phase two to begin interfacing or integrating with the various systems and processes.
So as an example, right now you create your profile at BizPort, and that it gives you a chance to where you can track your progress. And you have a checklist and you can pick up where you left off. What it doesn't allow is for a single sign-on, where you're able to log into your BizPort profile and that automatically, like you would experience let's say with Turbotax, where you're logged-in in Turbotax and when you get done with all of the information collection and answering all the questions you would then are able to say, click the button that says submit my taxes to the IRS.
That's the tool, that's the interface that we would like to be able one day to create between the BizPort profile and all of those other agencies that single sign-on that would cut across.
And in your profile would cut across all the different systems and departments and agencies that you might need to interact with so for instance your business licensing profile, your utilities through gas and oil or you know, water or sewer and trash, maybe it's your building permits. Right now all of those different systems have different sign-ons, they have different back-end databases because this was the era of closed systems and we have these legacy, proprietary systems that are still out there and that unfortunately, you know one half of government is still dependent upon these big investments we made over the years, and it's going to be a big investment to transition out of those those proprietary systems.
And then on the other hand we’re utilizing you know open source and online, you know, hosted solutions. That like BizPort or like, you know, some of the other applications that are running out of the cloud and you know they present a lot of opportunity for API's and direct interfacing and potentially single sign-on like you experience when you're logged in when you use your Facebook profile to log into different applications online.
So that's where we're headed, that's still in future phases. We did our best in one year though remember the entire BizPort application was built in less than a year. Built and launched in less than a year. And I think that we made a decision to do this first, this first version with the idea that we would then take a full year of investigation to see how people are using it and where we have opportunities for improvement before we would then build version 2. So we're now happy to say that we've hired a staff member who will be taking over the BizPort application not only the curation of the content, the management of the chat that the triage and referral of inquiries that come through the system, but then also starting to meet with groups of users around the improvement and restructuring of some of the BizPort architecture as well as maybe adopting some of Minneapolis' innovations.
Gavin: Fantastic. Everything you've just said before leading up to that John made absolutely perfect sense. I mean the approach of you know, building certain components and then iteratively improving that and expanding out and proving your worth over time.
There's obviously a certain advantage within a municipal government because of its size that you're able to kind of deal with this a little bit more, it's a bit more confined. How much of those principles that you follow,do you think could be applied you know beyond a municipal government, whether you're looking at a state type of level or a national level?
John: Yeah well I do think that, I do think it can apply at any level because of the way that, you know information technology, internet-based cloud-based information technology is you know, almost infinitely scalable I mean that's the thing.
In the old days when you had a client based system that was you know sitting on servers in the basement of city hall, there were a lot of constraints as to you know, how many, how many records, how that information would flow in and out of local system secure systems, but now because of the speed of processing, because of the advent of the cloud, so where it's hosted and how information is processed and then distributed and then just the sheer size of you know the network is really making, you know, these tools available anywhere in the world for any size of organization and that's why to if you can build in an open architecture where people are able to plug in their own innovations and their own applications, I mean our hope is that someday, we'll get to a point at least within our community that you know, we'll build the initial platform, like BizPort and then the entrepreneurial community will find opportunities where they can plug-in applications that will both pull data out and push data in but allow for people to improve maybe the market research component or the site selector or they're able to improve the way that content is displayed or delivered so you know with regard to how big can it get, it just depends on how much the government itself wants to control the resource and how much the government wants to partner for delivering solutions.
And then it all begins with the initial architecture of whether or not you as government believes that, "Hey we're going to provide all the solutions and we're going to be the source of the solution,or we're going to create a platform by which the creative marketplace can, you know, identify challenges and create those solutions and then contribute them to solve...
Gavin: John, I can't hear you.
John are you there? I still can't hear you.
John: Can you hear me? Okay. I think, I'm just running down the elevator now because I've got to pick up my son from basketball.
Gavin: No, worries John. My daughter does basketball so I know exactly where you're coming from.
Just before you got in the lift you were talking about partnering with the private sector to help with, your delivery approach for BizPort and one area I know that you've started tackling is rather a perennial issue actually for new business, and that's accessing finance. John, can you tell us a little bit about what you're doing in this space?
John: Absolutely. So what we did initially with the innovation team is by shadowing and observing users and particular different types of entrepreneurs throughout the city. We identified some really common challenges that cut across the different types of businesses and the different types of entrepreneurs that we met. Mainly cost confusion, you know, clarity of the process but also access to capital. So that was one of the primary challenges that entrepreneurs face no matter what industry sector.
So for us, you know, when we were looking at where we can help entrepreneurs access capital, you know there was the traditional banking opportunities and loans that require certain levels of historical revenue and and credit history, that were just not available to a lot of micro entrepreneurs and many of the people that we talked to, were generating their first seed funding through friends and family and not through traditional banks.
And so you know the other place than traditional banks that people were accessing capital were through you know government subsidized loans, like Small Business Administration, Federal loans and those kind of programs but those also started at about $25,000 and also required even with the city underwriting or the government underwriting some of the risk, they still required a certain level of credit history and things that a lot of our micro entrepreneurs simply just didn't have. And so what we decided was, "Hey let's look at some other options."
And when you look around the world, you know, micro-finance is one of those opportunities that's working in many developing economies and essentially what happens, is that many people contribute small amounts, you know, trustees and lenders; many people contribute small amounts of money to help micro entrepreneurs to put together small amounts of capital to invest in and then repay those loans over a period of 18 to 36 months. And so, leveraging technology and leveraging, you know the internet, is a really good way to both identify borrowers as well as to identify lenders, potential lenders, and to get the community to contribute to local small businesses through microfinance.
And so we've recently launched, Kiva which is a nonprofit. Again a nonprofit technology based company that actually provides the platform via Paypal to connect micro entrepreneurs who need capital to a whole network of people who provide capital - they've done over a billion dollars in loans around the world - and they have about a 97% repayment rate which is beating the commercial banks in terms of repayment.
For people that don't have to have any credit history. All they need to do is be able to establish a Paypal bank account, they need to, they need to find a trustee, somebody in the community who will vouch for them and say, "Yes this is a real person and I'm going to help this person with their business." And then they can, you know, go up on the Kiva platform as a potential borrower and tell their story and people can contribute. So that's an example again of government not necessarily being the solution.
We don't have to come up with millions of dollars and manage a big lending scheme in fact we can, utilize technology and utilize partnerships with the nonprofit sector, again to create a platform by which the community can, both invest in and benefit from investment in in an open-source kind of environment. So yeah that's another example of using that same philosophy of public-private partnership of open-source platforms, leveraging technology and ultimately making it easier for people to get to overcome a challenge.
Gavin: I've recently read in the Long Beach Business Journal that you were also looking at another really innovative diagnostic approach using artificial intelligence to match entrepreneurs with local mentors who can support them on their business journey. I really think our listeners would love to hear a little bit more about this as it's something that I've never had been done before can you tell us a little bit about it John?
John: Absolutely, well another one that we just recently launched, is something we're very proud of in terms of partnering with in this case the private sector to identify what's called a psychometric assessment of entrepreneurs' readiness.
One of the challenges that first of all starting your own businesses is really, really difficult and there's a really high failure rate. In fact in America you know, more than 50% of businesses fail before reaching that 60 month mark and you know, we wanted to help businesses be successful starting. We wanted to help them grow but also our goal from an outcome perspective was to see if entrepreneurs in Long Beach could last and survive longer than the national average.
So one of the things that we had identified again as a potential solution is how do we help entrepreneurs to identify whether or not they're ready or whether or not they have the right stuff to be an entrepreneur because there's really three main ways people make money in Long Beach.
One is as a worker. For somebody else, as an entrepreneur. So self-employed or employing others or as an investor. You're doing you know, equities you know securities, maybe real estate investment, investing in other people's projects.
And so it's not the case that everybody needs to be an entrepreneur even, though that's a major focus of our economic development work. So how do we, how do we help people avoid, making fatal mistakes as well as how do we in a low-cost really efficient way, even a fun way, help entrepreneurs to match up or connect with resources and mentors that really can help them. So it's not somebody you know, who spends a lot of time consulting but really have, no experience in that particular type of business with, that particular type of person. So we went out to market through something, an innovative procurement process called Citymart. It's an open procurement challenge. Citymart was originally started in Europe they're now in New York. Great group who are trying to revolutionize government procurement.
We put this challenge out to the open market and said who has solutions who can help us, you know, help entrepreneurs connect with these resources and really know if they're ready to start a business. And I'm happy to say that we just launched last month, we became the first investor and the partner, the governmental partner, with StartItUp.org and this is in its beta phase right now and you can go online, you can download at StartItUp.org either for Android or for iPhone.
This group did an incredible job. They had experience building these applications and the actual tests that entrepreneurs take through this application is done through a chat function on their mobile phone. It saves all their information and then via algorithms it matches them to, based on their strengths and weaknesses, it matches them to a potential mentor in the network. And we just launched this in Long Beach, it's really an exciting application that we hope will revolutionize the way that we assess entrepreneurs and connect entrepreneurs using technology and algorithms to people in their mentor network.
And the questions, just you know, the questions were developed by Stanford University over a three-year study and so these are really interesting tools, an interesting approach, again government not necessarily creating the solution itself but partnering with the private sector to develop new solutions.
We have the, you know, we put in some money, some seed capital but we also more importantly connected the developer with the pipeline of entrepreneurs in our one of our small business, business improvement districts in north Long Beach. We connected them with partners locally and also with you know, the background on the challenges that we face as a government. So we partnered with the private sector to develop something that's never been available before so we're really excited, about that tool.
Gavin: Wow John that's some amazing stuff that you're doing there at the moment. Thank you so much for sharing with me today and sharing with our audience and for being my very first interview on the show.
John: Gavin you're doing an amazing service by connecting us all with good practice around the world. Literally an international ambassador of good government. So thank you for your work, and keep it up!
Gavin: Thanks John, talk soon. See you, bye.
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