The GovTech 100
If you are interested in Government technology, you might have noticed that Government Technology Magazine released something called the “GovTech 100” for the second time early last week. In-fact, the last edition of the physical magazine — yes they still exist, and yes even as a venture investor, I still subscribe to a couple of paper publications — they dedicated 10 pages to the new list.
This is big. Really, it is.
First, it’s big because this list represents one of the first times an organization has attempted to consistently track and organize government focused technology businesses. But beyond the list of 100 companies — GovTech Magazine also announced a new partnership with Crunchbase. The big news here is that by partnering with Crunchbase, Crunchbase has decided to make “GovTech” a category in their database. This is important, because discovery is one of the most challenging parts of being a startup. You can’t get funded if you can’t get found — assuming your network isn’t overflowing with VC’s.
Now let’s talk about the list.
The good
There are a couple of really exciting things the list represents. First, it represents an opportunity for a GovTech company to be recognized. When you’re a startup, recognition can be huge for developing interest in the product you have to offer. The implication here is that the companies featured in the list have achieved a certain level of success which leads them to be placed on the list.
Outside of GovTech, there are a lot of examples of lists and rankings providing industry recognition. In the enterprise world there are reports that are put out by Gartner, IDC, and other organizations. The hope for many of the companies listed in the GovTech 100 is that this classification will one day carry the same level of positive market signaling as other lists.
Second, the list provides an organizational framework. This is important when an ecosystem is developing because it’s human nature to want structure. And while I might have some thoughts on the given structure — hint hint — the GovTech 100 is still in it’s early days and it’s SUPER EXCITING to see organizations take notice of the GovTech eco-system and trying to understand it.
The bad
What’s simply bad — and maybe a little misleading — is that the list doesn’t differentiate companies by stage of maturity. Publicly traded and 1 year old start-ups are listed side by side. This makes it tough for the average reader to understand what criteria the company used to feature companies. Do they all really represent, “the next wave of civic innovation” as the site indicates? Or did they mix in a bit of the status quo — FYI, they did.
Why should I care?
You should care about this because Seed stage and public companies have significantly different potential for disruption in their respective fields. Their abilities to innovate are completely different — it’s like turning a kayak vs. turning an aircraft carrier.
Furthermore, recognizing at what stage the companies are at illustrates the development of the greater market in which they function in. A newly disruptive market will tend to have more companies at the Seed to Series A stage, while a more mature market will contain more public companies. Grouping all these companies together can blur the distinction between which sub-sectors are currently seeing more innovation and which markets have already found established players.
If you’re an entrepreneur, this kind of information might help you decide where to focus your entrepreneurial genius. And if you’re a civil servant, this information might help you better understand the relative risk or the questions you should ask — the earlier the company, the more likely you should have a conversation about funding.
The ugly
Now here’s where I think the list really goes wrong: Classification.
If you read closely, the GovTech 100 classifies all their companies into four sectors — Administration, Service Delivery, Civic Tech, and Smart Infrastructure. However, I believe that the segmenting provided is insufficient. I understand what they were trying to do — break the GovTech world into 4 simple areas. But here’s the problem, It’s not actionable. If i’m looking for a new CRM, what do I look under? Service Delivery? Administration?
Aside: If you’re sitting there thinking, wait Fred, I can think of two classifications that work — i.e. Civic Tech vs. GovTech — then pat yourself on the shoulder because you’re spectacular. I agree that’s the way to keep it simple.
Instead of making it easy to understand, the segmentation is confusing. It also ignores the fact that dozens of companies in the GovTech 100 fit into two of the four categories — makes you wonder how they make their choices?
Alright Debby Downer — got something better?
Yup. I created an alternate way to classify GovTech firms (excluding Civic Tech) by creating a “stack” as shown below. Focus on t
Nerd Alert — Detailed Description of the Chart
This stack illustrates the levels at which different GovTech companies would function on as well as providing the level at which the innovation is driven by. Change and innovation is driven by higher level movements in government which then leads to the first “stack” labeled as solutions. These solutions are the products that are government facing; meaning that these are the programs that are directly used and as a result influence the efficacy of government. I break these out by the segment and solution as to which these products fall under. All of these segments sit above the “Innovation Stack” where Infrastructure as as Serivce “IaaS” and Platform as a Service “PaaS” sit as these are levels of technological advancement rather than new solutions. By splitting up new technologies from leveraging existing technologies to create new government-specific solutions our classification system provides the reader with a better perspective on the functionality of a company.
Using a classification like this is easy to understand and it’s actionable because if you’re looking for a solution you look for the solution, not whether or not it’s a service delivery software solution — ew, what does that even mean? While it’s not all encompassing, I think this is an area where we want more detail and not less.
The promising
I was once told that constructive criticism should always be done as a sandwich — good, bad, good. So here’s why I still love the Govtech 100 list.
If you read the article, they talk a lot about how the GovTech marketplace is expanding. And they’re right, there’s a lot of activity in the space. That’s good! No, that’s great! Lists like this will make it easier to for VC’s to invest because they do some of the heavy lifting. While it’s easy to sit back and rip on the GovTech 100, I know from talking to the team that this is an immense undertaking.
One of the really big wins this year is that the folks behind the GovTech 100 have done an amazing job at describing the market size, developing key relationships with trusted Silicon Valley names, and really worked hard to improve the list over last year. This is an iterative process, and it will take folks like you and me to help them make the list better and better!
I’d love to hear your thoughts on the list, the categorizations, or the companies you think they missed! If you’re working with an amazing startup that didn’t make the list, let me know!