SXSW panel: Kendra Scott, Mark Cuban call Texas a hotbed for entrepreneurs
Texas tycoons Kendra Scott and Mark Cuban see Texas as a special place to do business and get companies off the ground.
Taking part in a Tuesday panel discussion during South By Southwest, Scott and Cuban talked the importance of investing in your community and what sets Texas apart from other states.
Amid the pandemic, many companies have expanded in or relocated to the Lone Star State, and startup activity continues to boom.
"This is a breeding ground," said Scott, founder of the Austin-based jewelry design company named after herself. "Entrepreneurs love to help each other here in the state of Texas. Austin is known for having the University of Texas, we're the state capital. It's a very diverse culture of people with a lot of creativity, and it's an exciting place to start a business."
Cuban, the billionaire entrepreneur and owner of the NBA's Dallas Mavericks, was quick to praise Texas for its business-friendly climate.
"There's so much less friction doing business here than Silicon Valley or other tech destinations," Cuban said.
Along with the tax benefits of doing business in Texas, the state has a strong workforce, a young, vibrant and educated community, reasonable real estate prices and strong educational options, Cuban said.
"What's not to love about doing business in Dallas Texas?" Cuban said. "You've got a better chance of making money when you're doing business in Dallas and Texas generally."
Scott said she started her jewelry brand 18 years ago going door-to-door with her jewelry in a tea box. That's not something that would have led to success in a place like New York or San Francisco, she said. At the time, Scott said, people told her she had to be on the East Coast or the West Coast to make it in fashion.
"Here we are one of the most successful jewelry brands in the world, out of the state of Texas. I truly believe this state, this city (Austin) gave me the wings to fly and so being able to now share that success with other entrepreneurs is really exciting," Scott said.
Scott said Texans understand that they're stronger through shared knowledge, something that she views as critical to Texas' success. She pointed to entities like Austin business incubator Capital Factory as crucial to creating a community of shared knowledge.
"We know that we're competing against the world, so why not help each other? Why not share ideas, best practices with one another, so that we can be successful together?" Scott said.
Scott said you when entrepreneurs are starting out they need to be passionate, focus on filling a void, and bring their authentic self to put themselves out there.
"Focus on building something great and be scrappy," Scott said.
Scott said she's been investing in a number of local brands doing exciting ventures. For example, she pointed to Tiff's Treats, the Austin-based company that delivers warm cookies. Scott invested in the company last year as part of a $15 million round that also included investment from former Dallas Mavericks player Dirk Nowitzki.
Scott said Tiff's Treats has a fast growth trajectory, but is also giving back to the community at the same time.
"As an entrepreneur, I look for those things," she said. "Seeing entrepreneurs that are doing something exciting and new, but also really making an impact on their community in a really impressive way has been something I'm so happy that I can be a part of."
Scott said to her, business and philanthropy go hand-in-hand. She said customers are looking for a brand that means more than just a great product, and it's important that businesses authentically show up, and don't just "write a check."
"The important thing for any entrepreneurs is that you really making it a part of your core values," she said. "It's great to have a great business, but people today want to have something they wear that means more than just a great product."
Cuban said he also looks to invest in places where he can make a difference in the community, through the Mavs Foundation and others under his umbrella of companies and investments.
In the longer term, he said, he looks to donate to long-term solutions. He also said he looks to commerce when there are not existing good options. His Mark Cuban Cost Plus Drug Program, which manufactures low-cost versions of high-cost generic drugs that treat ailments such as hookworm, is one example, he said.
"Trying to come up with solutions that solve problems and make life easier for people, those are kind of the three ways I look at things," Cuban said.
Cuban also spoke about his newest venture, Fireside, an audio platform he co-founded with Falon Fatemi, which he said will be "podcasting 2.0."
The idea is similar to live audio startup Clubhouse, but Cuban views Fireside as taking the best of Clubhouse and podcasting coming together. The platform will be a more controlled environment, recorded, transcribed, and creators have monetization opportunities for the podcasts that come out of it.
"We want the information to have quality," Cuban said. "We want the interface and the interactivity to have quality. and so that's more important than just seeing how many people we can reach. "