By Mark Headd.

In my last post, I made reference to some of the qualities of civic startups – the special and important things about these kinds of small, agile companies that set them apart from other startups.

I think clarifying what civic startups are (and what they are not), as well as what we expect them to achieve is important.

Let me be clear, I have great respect for anyone who creates a startup. I have many friends in the technology community who either have, are or will work for a startup company. I do not mean to suggest that civic startups are, generally speaking, “better” than other kinds of startups.

What I mean to emphasize is that civic startups have particular qualities that make them attractive to both governments and citizens. Both parties have an interest in seeing these kinds of startups succeed because both will realize benefits when they do.

Let me explain.

Civic startups are those companies that, through the pursuit of their core missions, produce what economists call a positive externality. In other words, there are benefits inherent in the services these companies provide that are not reflected in the cost of that service.

This is fairly easy to see when we look at companies like TurboVote and ElectNext, or SeeClickFix and CitySourced. Everyone benefits when voters are more engaged and participate more regularly in elections, or when city neighborhoods are cleaned up.

When people use the services of these startups, other people that are not users reap a benefit. This is exactly the kind of company that governments at all levels should be working to encourage.

Civic startups are also those companies that use government data to take on a role previously fulfilled by governments themselves (or by contractors hired by governments). This is most easily seen in the development of customer, or citizen-facing software applications.

In the roughly 15 or so years since the Internet became a viable channel through which to provide government service, it was governments themselves that built most of the citizen-facing applications. With the release of open government data and support for programmable interfaces like Open311, we are witnessing an increasing amount of this work being done by independent parties outside of government (and outside of traditional government contract vehicles).

More and more applications that people are using to interact with their governments and consume government services are being built at weekend hackathons, or by startups that want to leverage open data to provide a useful service. Think of applications like YouTown, that are built on open government data and that provide new ways for people to interact with their governments.

Instead of governments building these apps directly, or – by extension – through a contract with an existing company, governments are increasingly becoming “data stewards” responsible for providing the raw materials for building useful civic applications. This is a major paradigm shift for governments, and civic startups will play a critical role in it.

Governments have traditionally faced limitations in hiring and maintaining top IT talent, and the pace of innovation in software development moves at a rate much different than that of the traditional government procurement process. By embracing open data and APIs, governments are opening the door to smart, civicly-minded, business savvy individuals to fill the void with the latest technologies.

In the case of civic startups built around transit applications, we see both of these qualities of civic startups in evidence. Transit-focused civic apps are built on data collected and maintained by transit agencies, and by encouraging more transit ridership they generate a benefit even for non-users (less traffic, less pollution from automobiles).

Understanding what civic startups are is important. Because there are real benefits to be gained from the success of civic startups, governments would seem to have a built in motivation to help them succeed. To the extent that these startups are easily recognizable, governments will be much more likely to do so.

Having a clear definition of what civic startups are will also help us evaluate their success, and the success of efforts to support them and help them grow.

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Originally posted at