#StartupsEverywhere Profile: Alec Sorenson, Founder and CEO, Tradespace
This profile is part of #StartupsEverywhere, an ongoing series highlighting startup leaders in ecosystems across the country. This interview has been edited for length, content, and clarity.
Patenting Success Coast to Coast
This week, we met with Alec Sorenson, Founder and CEO of Tradespace. Alec, a recent transport to California, left his position at a traditional consulting firm in D.C. to grow his company in the Bay Area. He saw the dilemma of de-risking and de-costing the commercialization of technology and knew he could innovate to solve this critical problem by using data and analytics. Leaning on his view of both the D.C. ecosystem and San Francisco ecosystem, Alec offers a unique perspective of how government can work with startups on issues from immigration to access to capital. He offers a key piece of advice, as Alec believes “This work starts with us - having conversations with lawmakers and speaking up. Education on this issue is key.”
Tell me about you. What’s your background? Why did you start Tradespace?
I graduated from University of Richmond and I didn’t have any issue or area that I was truly passionate about. I enjoyed solving problems, so I went into management consulting. I started at Avascent and my work was focused in markets in which the government was the driver (ie. defense).
In my role, I saw that government contractors typically don’t work well in commercial settings. I identified the potential for spinning out startups, by selling these products. There is abundance of technology that is under-utilized. I was faced with the dilemma of how we de-risk and de-cost the commercialization of technology. I knew we could solve this critical problem by using data and analytics.
That is why I founded Tradespace. We are using data analytics to help people make the necessary decisions. By using machine learning, we take advantage of large amounts of publicly available data. We take it and make it easier to understand.
When you think about intellectual property (IP), huge companies spend millions of dollars to make their IP portfolios robust. Typically, smaller companies don’t play in this market. Our aim at Tradespace is to lower the cost and allow smaller companies to enter the market.
Why did you get started in D.C.? What makes D.C. an ideal place to start a company?
Getting started in D.C. made sense for a few reasons. First, I have a background in aerospace. IP is underserved by government contractors. D.C. has a fair amount of research and development funding, but it goes untapped. This market was ready for disruption.
Second, there’s a strong legal background in D.C. We did customer discovery with firms that understand IP. It helped us to understand the market we were trying to disrupt, while building our network. Third, D.C. is an international city. IP crosscuts national borders and serves as a launch pad for closing deals across the globe.
D.C. is beginning to develop the infrastructure to make it easier to start a company. There are groups like 1776 that help startups gain the exposure to grow.
But you left D.C. and moved to San Francisco. Why?
There are many benefits to living in San Francisco. The ecosystem here is more built out and established. It’s easier to access people who know the steps of growing a business. You are surrounded by people who have broad networks. Entrepreneurship is a way of life here.
Is the government in San Francisco helpful?
Legislation around capital is open. Given the amount of funding available, government hasn’t taken enormous role. This ecosystem dates back to 1960-1970s and it has matured. There are not many gaps that need to be filled by the government itself; plenty of organizations are focused on helping companies at all different stages.
However, I incorporated my company in Delaware. We did this for a few reasons. There’s a fair amount of established case law in the state. Our company operates in a litigious space and we wanted to make sure there was precedent.
How do you balance your international and national work?
It’s interesting. Asian companies are becoming more and more interested in getting involved in IP. We have to balance the tension between promoting US human capital assets, while not facilitating outflow of intellectual capital.
To this, trade agreements are important to our work. Companies are developing new tools to build things better faster, more effectively. But with the looming threat of trade wars, it can lead to the disruption of the global supply chain.
What other policy concerns keep you up at night?
Access to capital. Large and small need access to capital. When the economy (and the global economy) becomes destabilized because of threats to trade and growth, it affects entrepreneurs. It has a ripple effect to the funding environment, which hinders growth. This especially effects early-stage companies. I believe there’s a role in the government to help stabilize the market and create an environment with fewer swings and more certainty.
Immigration is another one. Small businesses need resources. We need to allow people who are educated and talented the ability to immigrate. Tech talent is so tight, especially in San Francisco. There is so much demand. We should make it easier for those skilled people to help support american companies.
Are there specific public policies or government initiatives that have enabled startup growth in San Francisco?
There is a role of local government to bridge innovation gaps. There’s more than enough capital in San Francisco and government has really let the market flourish.
Access to capital is so different in every other city. There is an enormous opportunity for all levels of government to help other markets.
There is a real need in those underserved environments for capital. Also, any capital developed in those markets should come with as few strings as possible.
The whole concept of my business is to increase connectivity. We can flourish by helping innovators in those underserved markets. By rethinking traditional concepts, we derisk that technology and have true potential to help early stage companies.
There is also a role for universities. They need more resources so they can help stabilize the market. The more support we can give those innovators the better. Universities can be good partners; there are few places with so many dedicated resources to innovation.
Universities can help companies get more out of research and development. Ultimately, this drives economic growth and company formation. Universities are typically less risk averse than the government and that’s important for innovation. However, they need the right partners.
From a policy perspective, do you have any wishlist items for the startup ecosystem?
We need common sense IP policy that protects small companies’ ideas and gives them room to grow. At the same time, those same policies cannot be so strong and complicated. We need to finding a balance between ligatation and protecting patents - they should not be weaponized.
This work starts with us - having conversations with lawmakers and speaking up. Education on this issue is key.
Engine works to ensure that policymakers look for insight from the startup ecosystem when they are considering programs and legislation that affect entrepreneurs. Together, our voice is louder and more effective. Many of our lawmakers do not have first-hand experience with the country's thriving startup ecosystem, so it’s our job to amplify that perspective. To nominate a person, company, or organization to be featured in our #StartupsEverywhere series, email firstname.lastname@example.org. Give us your feedback here.