For all the hoopla over lifting restrictions on soliciting fundraising for startups RE: The Jobs Act, the biggest, relatively uncovered story for Entrepreneurship is the Affordable Care Act (ACA) and the opening of the healthcare exchanges on October 1. This law and the idea of affordable, market based insurance truly opens the door for everyone to start their own business. The market places enable standardization (much like labeling on food), transparency (like any good market place), and freedom (just like America, NSA notwithstanding). Here are 3 reasons the ACA is better for entrepreneurs than the Jobs Act.
3. Startups already have funding sources; millions don’t have insurance
Fundraising can be hard, but there is a well established network of websites, demo days, angel investors and venture capitalists to fund your startup. If you are self-employed, have a preexisting condition or work at a job without insurance coverage, before the ACA, you simply were SOL. Now, everyone can get insurance, and this opens up all kinds of opportunities…
2. ACA breaks the healthcare handcuffs
For many potential entrepreneurs, especially those with families or preexisting conditions, quitting a job with insurance was often not an option because the market was very expensive and often unavailable for the self-employed. ACA breaks the handcuffs that bind workers to their jobs. If you can save up enough money to pay for food, rent and insurance for a year or two, it is very realistic that you can quit your job and start the business you have always dreamed of. The internet has democratized marketing for startups and other small businesses. For the people who run those companies, the ACA is doing the same for insurance.
1. ACA creates more market opportunities/disruption than Jobs Act
While equity crowdfunding is a new opportunity, it is really just a tweak to the current crowdfunding environment. The healthcare mandate and the exchanges create and expand many new markets for startups. Not only can we figure out how to provide insurance for the uninsured, there is also potential to disrupt the traditional big business healthcare model as well as revolutionize how healthcare is delivered and paid for in the US. For those who take advantage of it, the ACA and the market around it is an enormous opportunity to both make money and build a better world.
Do not get me wrong. I love the Jobs Act, and I think it will do wonders for those who take the risk, dive in and start their own business. Combine that with the Affordable Care Act, and you have a new system that can revolutionize how business operates in America. Small business has always been the growth engine of the US. The ACA and the Jobs Act continue that tradition and set the stage for our economic comeback.