Andrew Yang Wants to Put Bright Minds in Poor Cities

Andrew Yang hopes to use his new non-profit to funnel bright business-minded college grads to economically-distressed cities.

What struggling cities need more than anything else are jobs, and the best way to create jobs is to send bright young entrepreneurs to help start up new businesses. That’s the concept behind Andrew Yang’s startup Venture for America (VFA), a New York City-based non-profit.

VFA is launching its organization by kicking off an application process to recruit an inaugural pool of at least 50 graduating college seniors from the class of 2012 (“Fellows”). These fellows will live together while working for start-ups in Detroit, Providence and New Orleans, three of the nation’s most economically-challenged cities.

“Our concrete goal is to generate 100,000 U.S. jobs by 2025,” announced Yang, VFA’s CEO.

VFA hopes to do for business startups what Teach for America has done for education — bring young, talented grads to work in underserved communities for at least two years, hopefully spurring new enterprises in parts of the U.S. that are generally shunned by top college graduates.

“The overwhelming majority of seniors from the country’s top universities opt for traditional careers in service-based industries within big cities like New York, Boston and San Francisco,” notes Yang. “Far too few of them are engaged in job-creating enterprises—especially within communities dealing with economic transition. Our country’s inability to channel its talent to create jobs is a major weakness for the U.S. in the global economy, and will only get worse if it’s not addressed.”

Yang has already received a commitment to hire 20 fellows from the 2012 class from Detroit Venture Partners, an early-stage VC working to rebuild Detroit through technology and entrepreneurship.

“We are thrilled to join forces with Venture for America in an effort to facilitate urban renewal, job growth, and hope,” said Josh Linkner, CEO and Managing Partner of DVP. ““We believe this incredible program will not only benefit our portfolio companies, but will also provide a rich experience for the fellows that, in turn, will shape their careers in a positive and high-impact manner.”

“We’re excited to have enterprising young college graduates come to Detroit to help build businesses,” said Mayor Dave Bing. “Detroit is a land of opportunity for those looking to make their mark.”

Start-up companies within the target cities will be identified within industries with potential for future importance (e.g., energy, biotech, materials sciences, infotech, education innovation, etc.). These start-ups will be presented with VFA fellows to hire for two years at a salary of $32- $38,000 per year, far below the levels generally commanded by top college grads with business degrees. At the end of the 2-year period, the company can hire the fellow under new terms.

Fellows will be selected through a competitive application process that will include peer and faculty recommendations, multiple interviews, case studies, business plan submissions, and behavioral exercises. They can express preferences for regions and industries of interest, but will be obliged to accept their assignments. Fellows will be sent in groups to cities to encourage a sense of shared experience and will live in group housing.

At the beginning of the program, fellows will attend the Venture Fellows Institute, a five-week boot camp that will consist of training programs in relevant skills as well as lectures, discussions and meetings with experienced entrepreneurs. Brown University has agreed to provide its dorms and facilities to host the first Institute during the summer of 2012.

Fellows will also be gathered for an ‘intermission’ after the conclusion of the first year of their assignment and a one-week graduation program at the conclusion of the second year. At the conclusion of the two years, the fellow who is determined to have performed the best during his or her fellowship will receive $100,000 in either seed investment for a new venture or support for his or her current company. Over time, VFA will work with established venture capital or angel networks to enable multiple awards and vendor services with each award.

In addition to its Fellowship program, VFA will provide a centralized recruitment infrastructure for start-ups and early-stage companies across the country. Applicants to the program will be included in a database that will be made available to approved companies for recruitment purposes.

VFA is a registered 501c3 non-profit corporation. It has received commitments of about $500,000 from board members, philanthropic individuals and various companies like IAC, Lawrence Lenihan of FirstMark Capital, David Lee of SVAngel and Dan Porter of OMGPOP.

Yang was inspired to start VFA based on his own experiences after graduating from Brown. He went to Columbia Law School and became a lawyer. Too late, he discovered that he had little interest in law. He then started an unsuccessful dotcom in 2000.

“The company had a mini rise and maximum fall,” Yang recalls.

Apprenticeships with two entrepreneurs showed Yang the value of learning entrepreneurship skills on the job. In 2001 he went to work for Manhattan GMAT, a graduate test-prep firm, and rose to CEO before leaving the firm in 2005.