✍️ Outsider Ink: Scott Dorsey Rewind, Indy's Tech Rise, Entrepreneurial Recycling
Outsider Ink is a bi-weekly newsletter from Outsider Inc.
After months of planning and building, I was thrilled to finally launch Outsider Inc. last week. I couldn’t have imagined a better first guest than Scott Dorsey. His journey—founding ExactTarget in Indianapolis during the dot-com crash, growing it into a $2.5 billion exit to Salesforce, and then pouring back into the region through High Alpha— captures what Outsider Inc. is about. Scott didn’t just build a company; he started a movement, helping transform a city by leading with heart and humility. I’m so proud of this first episode. Give it a listen if you missed it — it’s a special one. Links below.
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Growth of Indy Tech
After the episode’s release, I became curious about the growth and evolution of the Indianapolis tech ecosystem, so I took a look at the data. Below is the annual number of venture deals—an accessible but somewhat narrow proxy for tech startup activity—in the Indianapolis metropolitan area between 2000-2024 (green bars), along with the region’s share of the US total of such deals (blue lines—actual and smoothed).
Although Indianapolis accounts for a relatively small share of US venture activity (less than 1%), that share has grown significantly the last couple decades—even as the US venture market overall expanded at a rapid clip. The relative growth of Indianapolis compared with the nation accelerates in the years following the exit of ExactTarget and the launch of High Alpha. While correlation does not necessarily imply causation, this pattern is what I would expect to see from a large exit followed by an intentional doubling-down on a region by the people behind that initial breakout success.
Entrepreneurial Recycling
In our book, The Startup Community Way: Evolving an Entrepreneurial Ecosystem, Brad Feld and I write about this concept, referred to as entrepreneurial recycling:
The presence of successful entrepreneurship—startups that achieve a large scale or a sizable exit—has a massive impact on a startup community. Even a few of these successful events can dramatically alter the course of a startup community forever. Entrepreneurial recycling is one reason these outlier events have an outsized impact on the startup community.
When a startup has a successful outcome, the wealth earned by company founders, early employees, and local investors can be recycled back into the next generation of startups. Additionally, the experience of the local talent base improves, since founders, managers, and employees have now gone through a successful startup and scale-up event. The labor market grows for technical, managerial, and professional roles. Attracting talent from outside the region becomes easier. The local service and creative sectors become more vibrant as the economy grows with more well-paying jobs to support them.
Highly visible success stories, ignored in many entrepreneurial ecosystem frameworks, make the belief of success tangible even though entrepreneurial recycling is difficult to measure quantitatively. But success is crucial to the psychology of a startup community—particularly in places that have never experienced it, have an attitude of “it can’t happen here,” or generally have enormous structural barriers and limitations…
… Successful entrepreneurs, with the right approach, often make the best startup community leaders. In addition to being sources of wealth, knowledge, talent, and expertise, they are role models who embody what aspiring entrepreneurs can achieve. The question is whether—and how—they choose to engage.
Scott and his colleagues are living proof that this approach works.
Scott was also generous enough to write about his experience in The Startup Community Way. It’s an incredible first-hand account of how entrepreneurial success can be repeated through the right leadership and engagement model. Check it out!
Episode Highlights
I’ll close with some of my favorite moments from the Scott Dorsey podcast episode. In this first reel, Scott describes what he looks for in early-stage founders as an investor:
Here, Scott highlights ExactTarget’s early go-to-market approach that helped enable the company to gain critical early traction:
Above all, I enjoyed listening to Scott’s philosophy of servant leadership and his deep commitment to a community-driven approach—best typified by ExactTarget’s famous “Orange Culture”, which lives on to this day.
Thank You
Thanks to our listeners for the early support. Tune in next week when I’ll be speaking with Michael Praeger, the co-founder and CEO of AvidXchange—a Charlotte-based B2B payments fintech that he’s led from its humble beginnings in 2000, to a 2021 IPO valuing the company above $5B, and continuing as the company’s CEO today.