Today we are preaching the gospel of entrepreneurship with President and CEO of NC IDEA, Thom Ruhe.
If you’ve ever battled with the question “is entrepreneurship really THAT important?” listen to the mind-blowing facts that will have you proselytizing the world of entrepreneurism right along with us.
Thom Ruhe grew up in Northeast Ohio, but came to North Carolina when he was offered the position of second CEO of NC IDEA, who's mission is to foster entrepreneurism for the entire state. He has been working fiercely ever since to make North Carolina the best state in the nation for people of all backgrounds to start and grow companies.
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Note - Transcripts are created using AI technology and may not read 100% accurately. We apologize for any misspellings or mistakes.
Everybody has equal entrepreneurial potential. What's in-equal is the access to the networks, the resources, the support, you know, to, to nurture that entrepreneurial ambition.
2 (26s):
Welcome to Maid in the high country, the podcast that takes you behind the scenes of Western North Carolina's entrepreneurial landscape and the people within it. I'm Samantha Wright, and today on the show we will be preaching the gospel of entrepreneurship with president and c e O of NC Idea Tom Ru. So if you've ever battled with the question, is entrepreneurship really that important? Stay tuned to hear the many mind-blowing facts that will have you proselytizing the world of entrepreneurism right along with us.
2 (1m 8s):
Tom Ru grew up in northeast Ohio, but first fell in love with North Carolina due to the frequent visits he took throughout his life to the Outer banks. From 2007 to 2014, Tom worked as the director then vice president of Entrepreneurship for the Kaufman Foundation, a philanthropic private foundation based in Kansas City with approximately 2 billion in assets. There Tom directed the foundation's programs addressing entrepreneurial education, mentoring access to capital, and fostering entrepreneurial ecosystems. But in 2016, he was offered the position of second c e o of NNC idea, which was based in the triangle area of North Carolina.
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He gladly accepted this position away from the cold, cold winters of Ohio, and he has been working fiercely ever since to make North Carolina the best state in the nation for people of all backgrounds to start and grow companies. What I love most about this conversation with Tom Ru is that both NC Idea and Tom's own personal story are so deeply rooted in the impacts that entrepreneurship can have. NC idea itself was born out of a fascinating case of government investing in the private sector and getting a return on that investment.
2 (2m 32s):
The state invested in a startup called Kronos, and when that company had an exit, the state was left with a lot of found money.
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My predecessor and the founder, Dave Rizzo, was with a group of people at Mcnc and had enough kind of foresight to say, Hey, if we wanna perpetuate opportunities like this, namely economic development through entrepreneurial success, we should probably sequester, you know, a big chunk of this windfall and protect it, put it into a, you know, a nonprofit formation. So that all came about circa 2005. We were tucked under the nonprofit filing of c e D, which is, you know, one of the oldest running entrepreneurial support organizations in the state.
0 (3m 24s):
And so we operated that way for the first about 10 years of the organization and serving primarily as a grant-making entity. So the flagship program of ours is, is known as the Seed Grant program. It's a $50,000 grant program, we do twice a year and, and that pretty much was it for the foundation through about 2015.
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And how did you become involved in N C I D, Tom? Were there certain circumstances or experiences in your life that you see as influencing your pool towards entrepreneurship? Like, what was your upbringing like?
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I am first generation in this country. My mother, my father and my brother are naturalized citizens. They, they immigrated here from Germany. And, you know, I grew up in a, I think a very traditional immigrant household where, you know, hard work was just the, the way of life, right? In our case where my parents settled part of Cleveland proper, it was a very immigrant, heavy part of the city, you know, low income, cuz obviously immigrants typically are under-resourced, and it was multicultural. You know, some communities have like a little Italy or a Chinatown.
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This was more like the United Nations. So, you know, I grew up hearing a multitude of languages being exposed to multiple cultures. I think from an upbringing standpoint, that puts, you know, a young person already at an advantage when you have this kind of, even if you can't articulate it, right? If you just have this understanding of diversity and the strength that it, that it is, and again, you don't articulate, you don't even say such things when you're 10 years old, but your, your brain can process it as something that's good, right? And so that kind of well-rounded exposure kind of put me on a path.
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You know, my, my parents insisted you're gonna go to college. I was like, you know, I don't have the money for the college and my parents didn't have money for college. So, but they still insisted you will go. So just kind of outta necessity that put me on the path with United States Air Force. I like to say tongue in cheek. The, the two things that prepared me most for being an entrepreneur was my, the training I received in the Air Force and being a parent, because there's a lot of similar skills that you're gonna need right now. I will say my turn to entrepreneurship was accidental. I got hired by an entrepreneur and that changed my life forever, you know, was a, a gentleman that by his own admission, barely graduated from high school, but he had this startup, this little company in a dirty little industrial parkway.
0 (6m 26s):
And, you know, he, he was trying to crack the government, in particular, the Department of Defense market for his product. It was computer, particular kind of computer equipment. And as he had explained in my interviewing process, because of my experience in the Air Force, he's like, you understand what all that fruit salad on people's uniforms mean? And, you know, so go figure this out. Right? He had not been selling to the government. He hires this 23 year old kid on a thousand dollars a month draw against commission. I mean, this is the, the risk tolerance I had back then, you know, being young and stupid and really no obligations yet. And it was like, go figure this out.
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And that's what I did, right? And so I spent three, four years working for Bob, learning like what kind of entrepreneurship meant, but more importantly, living what it meant from economic potential. Because I saw this man who was barely scraping by when I started, you know, the company wasn't doing even a half million dollars a year in services or in sales. And, you know, within one year I secured the first multimillion dollar contract we got. And by the time I left the organization, you know, Bob was a multimillionaire and, you know, I was doing okay. I was 24 when I made my first, you know, a hundred grand and you're 24 thinking like, you know, life is great, but after a minute or two you start going, okay, it's nice that, you know, I'm making six figures, but the owner is keeping seven figures.
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You're thinking, how do I become Bob?
0 (8m 3s):
Right? That's exactly right. And so that put me on a journey of discovery and learning. And I, you know, it went from everywhere from scrappy startup without two nickels to rub together to, you know, startups that raised, you know, over a hundred million in venture capital. And that just really informed a lot of my life up until, you know, I hit my early forties and that's when, and my wife loves it when I tell this stupid joke that when I had a midlife crisis, but instead of a girlfriend and a motorcycle, I went into nonprofit sector and said, okay, you know, like this did this for our family.
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You know, I'm a simple man of average intelligence and I had, you know, the, the success, I know we can teach others to do this. And so that's where, you know, my, my career is actually in two halves. There was the first entrepreneurship half, which was like the first 18, 20 ish years, and then there's the second half, which has been the last 15, 16 years, you know, where I'm doing this work to help others have that same benefit.
2 (9m 12s):
Wow. What a story. I love that. And I, I love that both your personal experience and the birth of NC idea itself are really rooted in these real life examples of what entrepreneurship can do, right? I mean, we all know that not every company succeeds, right? Not every investment works out, but in these two incidences with NNC idea being birthed from a startup investment of its own, from the, from the state of North Carolina, and you seeing Bob's company succeed so well, it, it really illustrates the tangible benefits of entrepreneurship.
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But, you know, not everyone sees things that way. So I wanna ask, you know, for people that get a little squirmy, right? When they hear the word entrepreneur or, or capitalism or have this idea of capitalism, what that is painted in kind of a bad light in their head, you know, how do you address that dissonance when it comes up?
0 (10m 18s):
Yeah, it's, it's because, you know, entrepreneur, entrepreneurship, entrepreneurism, entrepreneurial, whatever variation you wanna use, it has what I call positive brand confusion. You know, it means different things to different people. So where, where we find on the rare occasion where there's kind of, I'll, I'll call it a, a hostility to the notion or concept of what entrepreneurship is, it's usually just ill-informed, right? It's considered, you know, as some sort of indulging of, you know, greedy capitalism at the expense of the environment or employees or anything else, but entrepreneurship as an economic development practice and, and promoting that, well, frankly, credit where it's due.
0 (11m 6s):
You know, I learned the benefit of that during my tenure at the Kaufman Foundation because the data is just overwhelmingly in favor of this. And the, the easy one word answer to that is jobs. It's a well documented fact that all net new job creation in the country comes from companies that are less than five years old. In other words, entrepreneurs. So in the state of North Carolina alone, over the last five years, we've had over a half million new startups in the state. So if you look at half million startups in North Carolina over the last five years, and if you just took the derivative of the high propensity firms, which are less than 10%, we know also from data from the coffin foundation that a high propensity firm in the state of North Carolina will generate on average 5.78 jobs in just the first year.
0 (12m 11s):
So if you multiply, you know, basically six jobs times the high propensity firms in the state over the last five years, that number of new jobs is one over 1.1 million. That is just a stunning figure, right? So think about that now, this just organic natural job creation engine that's just happening, right? And it's creating jobs at that volume. Now, superimpose that, or, or juxtapose that every time you hear of a story that North Carolina has given, you know, some massive international corporation, hundreds of millions of dollars in incentives on the promise of 3000 jobs or 4,000 jobs or 5,000 jobs, right?
0 (13m 4s):
Consider, I think it was the Apple deal was just shy of a billion dollars on the promise of, I think it was 3,200 or 3,600 jobs. So just gross numbers, right? 900 million divide by three, 3,200, you'll get the cost per job. And it's, it's very indefensible, right? It just doesn't make economic sense, but it makes great headlines.
2 (13m 35s):
We looked this up and the headlines for this, in April, 2021 read, governor Cooper announces Apple will create 3000 jobs in Wake County. So this deal was through a job development investment grant that authorizes the potential reimbursement to Apple of up to 845.8 million if they reach their stated benchmark of creating 3000 jobs in Wake County with a salary average of $187,000. When you do that math, this equates to a reimbursement of approximately $282,000 per job created.
2 (14m 24s):
Tom, you're so right. This makes great headlines, right? People hear Apple and they get excited, everyone loves the idea of more good paying jobs, but you certainly don't see many headlines about this or that new startup, right? That might have created five new good paying jobs. But like you said, if you stack each new business over the span of just a year, that's over, over 1 million jobs created mostly without any reimbursement from taxpayer dollars, right?
0 (14m 59s):
Right. And that's the challenge, right? And so one of the things we do at N C I D is we just, we try to beat the drama of logic and say, look at this economic engine that largely goes unnoticed more often than it should be, is happening anonymously with scant few resources to support it, right? And that's, I mean, that's what we kind of see as our ray zone detra, right? Our, our reason for being is to serve that potential. But damn, we could use a lot more help and we would, we would be happy to invite so many more people to this party because the upside is so good for the state of North Carolina that it's still a, a head shaker for me.
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That, you know, we still have to preach that, you know, that gospel, that benefit and, and still try to evangelize and convince people that it's, you know, it's time and money well spent.
2 (16m 1s):
Well, you've convinced me, Tom, you've made, you've made a believer outta me. I love it. So now that we understand a little more of the why behind NCI idea, tell us about the what or the how, how does N C I idea try to achieve their mission?
0 (16m 17s):
What we maintain are strategic portfolio of grants and programs to support founders through their journey of growth and discovery. So I mentioned earlier our seed grant program, it's the flagship of the organization. It's $50,000 grants. We do that twice a year, spring and fall. And it's, as the name implies, it's a grant. It's free money, 100% non-dilutive free money to the founders. Now, that being said, it's, it's a very competitive process. Every cycle, we will get 150 to 200 applications for that, and we'll make six to 10 grants.
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When we were considering our goals to have, you know, more impact on equity, we realized that historically a lot of our grants were being won by, you know, two white guys from, you know, UNC or Duke or, you know, state like triangle, triangle based, two white founders. And nothing wrong with that, but not exactly the outcomes we were pushing for. So we studied it and said, you know, why is that and all the socioeconomic factors that led to that outcome. And we said, okay, we had to intervene much earlier in that journey.
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So four years ago we created a, an additional grant funding program called Micro. And the micro grant program is, is the name kind of implies it's smaller, it's only $10,000 grants, but they are for companies that are much earlier in this, in their journey, right? Many times at just the idea stage, like, we have an idea that we want to do this, that, or the other, and if only we had, you know, seven grand to make some prototypes and then three grand to go to a trade show, kind of test our assumptions and see if, you know, we can get any traction on that. So that's what we did. And, and you know, I'd like to say we were both lucky and smart enough to do that because our numbers then just exploded.
0 (18m 28s):
You know, so many more, you know, women founders, minority founders, you know, founders from our tier one and tier two counties. And you know, what it affirmed for us is that, you know, everybody has equal entrepreneurial potential. What's in equal is the access to the networks, the resources, the support, you know, to, to nurture that entrepreneurial ambition. So we started investing in ecosystem partners. Now I'm flipping to another side of what we do or how we do it, and we've made grants to other entrepreneurial support organizations all over the state to help the entrepreneurs locally with their journey.
0 (19m 15s):
And so having kind of a, both a b2c, which is our funding direct entrepreneurs and a B2B strategy, which is our funding to entrepreneurs support organizations, you know, combining those efforts started strengthening a statewide ecosystem.
2 (19m 32s):
Yes. And it's thanks exactly to that side of N C I D I wanna say that we at Startup High country are able to do what we do. It's why this podcast exists. It's why we're able to throw events for local entrepreneurs, offer mentorship and advice free of charge to new or growing businesses in our area. We can offer programming with that support. And we're also developing some cohort style learning opportunities for high growth companies that will help catapult them forward and even give them special access to funding opportunities like pitch training and, and pitch practice if you plan to pitch to investors or are, are raising money or just help people understand the different capital options that are here.
2 (20m 19s):
And oftentimes some capital options that are only available locally here in the high country. So I just wanna take this opportunity to thank you for that aspect of what you do, because it's important to take into account the local environment in which you are starting or operating a business because there are unique opportunities and also challenges that come along with that ecosystem. And that's what what we try to do for entrepreneurs here at Startup High Country, because local support really does matter.
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You know, I, several years ago, I, I had the absolute joy to speak at an event in Boone, and I think it was our friends, you know, startup high country, you know, Jeff had been bugging me forever. And you know, Sam is a triangle transplant, so, you know, he knew of N C I D. And so, like I said, I was flattered to be asked to come and speak at this event. And, and it was just, you know, wonderful, it was one of those magical nights at close to a hundred people showed up, and it was just a great evening of celebrating the, you know, economic potential of supporting entrepreneurship. But on that trip, you know, I met a lot of other people and, and you know, Jeff took me over to meet the, the team over at Suga.
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And, you know, you got to see firsthand what supporting entrepreneurship looks like, you know, in a local company that's, you know, running a very good business, you know, following, again, their entrepreneurial passion. So, fast forward several years later, you know, through our grant program, our micro grant program, we get this, you know, single mom, founder Durham, you know, doing this just crazy cool marketing angle called fun mom bands. And she's created this product line specifically geared to the, you know, the overworked moms that, you know, run the household and everything else that they, they have to juggle.
0 (22m 24s):
So she designed this custom fanny pack. But the, the neat thing was, you know, as she was had this, this idea, you know, one of the first things she has to do is like, you have to take the idea and you have to manifest it, right? So she comes in, she applies for a grant, you know, she's talking about her prototypes, and I just ask the question outta curiosity, like, you know, so where are you getting the prototypes made? Because, you know, so often it's like, oh, you know, we've got a, you know, manufacturer out in China or somewhere else. And she said, oh, you know, there's a, there's a company out in Boone that I'm working with that, you know, is doing my first prototypes for me and, and just, you know, helping that validation process.
0 (23m 5s):
And I'm like, oh, that company suga by chance. It's like, yes. You know, how, how do you know? It's like, I, I know that's kind of corny, but like, when you start seeing the ecosystem supporting itself, again, I, I'm sorry if I'm coming off as some sort of like proud papa here, but that's what it's all about, right?
2 (23m 27s):
Yes. I, I know exactly what you mean. And the cool thing about that story that you shared, Tom, is that it goes to show that it's the small steps that matter, right? There is no magic sprinkle dust that makes a business blow up overnight. It's businesses like fun mom bands or suga or so many of the other small or growing startups in our area that start with an idea and just take that one step forward at a time and eventually make that idea come to life.
0 (24m 3s):
You know, Santa, the, the secret of this work is there's, it's not a secret. You just have to grind it out. You gotta do it cycle by cycle by cycle with people that know what they're doing, you know, sufficiently funded, patiently supported, you know, work with the partners that share your values. And if you do it long enough, you start creating a momentum that starts feeding itself. You, you can start sensing a collective appreciation for what I like to refer to as this thing of ours, right? Because it is, it's ours. It's everyone's, we're all vested and, and making this better for everyone.
0 (24m 44s):
And yeah, it's kind of magical, frankly.
2 (24m 49s):
It is, it is. That is the perfect word to describe what you call this thing of ours, because I mean, as immaterial as it sounds, it is, it's magical. I experience it whenever I'm at one of our events or in a workshop brainstorming session at our monthly socials, for example. You, you'll be in a room full of 30, 40, 50 plus entrepreneurs. And I am never as energized as when I am in that room with those people because not only are they just some of the smartest and most creative people you'll ever meet, but they're also some of the most caring and invested in our community.
2 (25m 34s):
And they're putting their heart, their souls, their blood, sweat, and tears into creating something for the joy of it Sure. But also for the benefit of their community. And it's, it's a beautiful thing. It's, it's magic.
0 (25m 51s):
I couldn't have said that any better, and I hope you don't cut that out. I hope you include that statement. Cause it was eloquently and beautifully said. And like I said, I couldn't have said it better. And it's, I mean, you just described why I feel like one of the luckiest people, you know, in the state to have the job that I have, you know, helping people realize their dreams. It's frankly, it's a privilege.
2 (26m 14s):
Hmm. I agree 100%. Couldn't have said it better myself. Well, Tom, I appreciate your time so much here with us. Are there any last words of advice you'd like to give people, especially those who are listening who have really been inspired by the words and, and want to be involved in this world in some capacity? Whether that's becoming a founder or just plugging in and supporting in, in a myriad of ways that one can support their entrepreneurial ecosystem.
0 (26m 46s):
If, if you're entrepreneurial curious, you know, then look locally first and see how you can engage in that. And then once you do, you know, don't blame me when you become addicted.
2 (26m 57s):
Totally.
0 (26m 58s):
You know, you so eloquently identified, you know, the, the beauty of supporting that earlier in this conversation, and, and that's what you, that's what's waiting for you. If you, you know, take the initiative to engage, so you've been forewarned it may change you forever.
2 (27m 16s):
I love it. Tom, thank you again so much for your time here with us today. Before you go, we always love to ask our guests this question. And I know you don't live in the high country, but you visit up here quite frequently. Do you have a favorite high country moment that that sticks out in your mind?
0 (27m 36s):
One of the things that I remember from early on in my tenure here at, at N C I D I think was, you know, one of my first trips out west was like, okay, you know, there's all the physical beauty, the outdoor magic and the wonderful culture, you know, kind of the, the mountain culture is, I think it's one of many of the strengths and assets of the state of North Carolina, and that's all well and good, but kind of the promotion and support and encouragement of entrepreneurship was still very nascent. There wasn't, you know, there was just a couple things, a couple entities that were, you know, dabbling, so to speak.
0 (28m 16s):
And when I think about what's happening in the high country now, there's, there's no comparison to what it was just five years ago from a coordination and a collaboration effort. I think collectively that region of the state is an exemplar for other regions in the state on how to work together. There's a, a genuine sense of, you know, good for all of us. So, you know, that pulling together and, you know, going to events now where you, you know, see familiar faces, you build on relationships that started years prior. That's just not something that happens accidentally.
0 (28m 58s):
That's not something that even happens organically. It happens through, you know, intentional intervention and effort and sharing of values. And I'm just so giddy with anticipation of what that's gonna feel like, you know, five, 10 years from now if it's already so tangible and strong now. And I just, I, I want to thank everybody in the region that's contributed to that happening. It, it doesn't happen without effort and y'all are taking just a great approach to it. And I, I take that as just a wonderful thing. I look forward to every time I have an excuse to come to the high country.
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Thanks so much for listening to today's show. This episode was produced and edited by me, Samantha Wright, community director at Startup High Country. You can learn more about our workshops, resources, events, and more by going to start up hc.com. While you're there, make sure you subscribe to our newsletter. It is really an excellent way to stay up to date on all things happening here in the high country around entrepreneurship. Again, that's startup hc.com. Hey, make sure you are subscribed to our podcast and leave us a rating and review. While you're at it. Share us with a friend as well to help us spread the word.
2 (30m 27s):
We are a very small show, so you personally recommending our show to a friend makes a huge difference. Thanks again for tuning in. I'm Samantha Wright and you've been listening to Made in the High Country.