Episode 42: The Gap Between the Private Sector and the Public Sector

TransLoc MarketingThe Movement Podcast

Government officials and advocates are not enough to make cities safe, healthy, and climate resilient. Liz Sisson from investment firm Urban US shares how she translates between the public and private sectors to help ensure city dwellers benefit from urban tech.

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Episode Transcript

Cohen: Josh Cohen
Sission: Liz Sisson

Cohen: My guest today, Liz Sission of Urban Us has spent her career straddling the gap between the public and private sectors and helping to translate between them. Hear how she does it and what Urban Us is doing to help make our cities more livable right now on The Movement. Let’s go.

F: Mobility is an essential component to the cities of our future. To build this future, we need to do more than invest in technology; we need to invest in the people who will make the hard decisions necessary to create vibrant, equitable, and sustainable cities. Welcome to The Movement where we talk to the brave leaders who are effecting change in an effort to build a coalition of leaders who will make tomorrow real. Here is your host, TransLoc’s National Director of Policy, Josh Cohen.

Cohen: My guest today is Liz Sission, the chief operating officer of Urban Us, an organization that focuses on getting capital to private sector ventures who are solving city problems, transportation, wastewater, government, energy, food, climate resilience, and so forth. So welcome to The Movement, Liz.

Sisson: Thank you so much, Josh. Nice to be here.

Cohen: So before we get started formally I’d actually like to ask you a question I actually asked my guest last week, which is fill in the blank; “People that know me well know blank about me.”

Sisson: Oh, interesting. They know blank about me.

Cohen: Yeah, let’s go ahead and break the ice here early.

Sisson: Yeah, I feel like I’m in a therapy session. It’s nice.

Cohen: [LAUGHS] That’s good. That’s good.

Sisson: Probably they know that I am very passionate about progressive policy.

Cohen: Okay.

Sisson: Does that answer?

Cohen: That’s great. That’s great. I mean, I just think it’s a—a friend of mine has a podcast, and she asks that question. I really loved it, so I think it’s a really neat thing. Well, good. Well, let’s get started more formally now, which is introduce us to Urban Us and the work you’re doing and kind of the investment thesis and philosophy behind the work you’re doing there.

Sisson: Sure. So Urban Us is an early-stage VC, so we invest in startups that are reimagining city life. And the entire fund was started mostly from a climate change perspective and thinking about how cities play a huge factor when it comes to climate change, both creating climate change but also mitigating it.

Cohen: Sure.

Sisson: So we invest in the verticals, like you mentioned earlier, food, water, waste, energy, transportation and mobility, the built environment, public health, civic and gov tech, resiliency. And of course there are things that fall in-between and sometimes there’s multiple sectors that fall in-between two of those different things, but those are generally the areas that we look at. But we also partner with BMW MINI on an accelerator called URBAN-X. Kind of confusing branding there, but we invest in the same verticals as I just mentioned but slightly earlier-stage companies.

Cohen: I know there’s several of your portfolio companies that you’ve invested in that are in the transportation space, so what are some of those that I think our audience may be either familiar with or that are interesting to kind of highlight as it relates to kind of the mobility piece of that, which obviously is a part of city life?

Sisson: So one that just went through our program I think two programs ago is called Circuit. It’s formally known as The Free Ride. And if you’re in California in one of the cities or if you’ve been in Williamsburg or the West Village or a bunch of other cities in Texas and Florida and around New England you’ve probably seen them. They’re small, six-seater, electric vehicles, and they’re typically outfitted in advertising. And they basically bring people—it’s sort of micromobility, last-first mile transportation.

There’s an app you can do. In some cities you can do a street hail, and they will provide you with a short-term ride for free. And they’re able to do that because both cities and advertisers are basically paying them to provide this ride. And so when you’re actually in the vehicle you can get sort of a advertiser’s experience. So if, you know, they have a drink, let’s say, that you will maybe be able to try the drink. So they’re really interesting. They bootstrapped for a while, and they’ve gone on to grow to—I think they’re maybe up to 30-plus cities at this point. So they’re really interesting. Some other ones, we have a collapsible bike helmet called Park & Diamond.

Cohen: Yeah.

Sisson: They’re hopefully shipping out this year, so everybody should check them out. But that’s—you know, when we were talking a lot about the scooter movement and, you know, what’s the future of the scooter movement, we were thinking more about what are the sort of fringe applications that we could really look into. And obviously helmets, not just for scooters but also for other types of mobility in cities, is really crucial. And, you know, helmets have not really been innovated on for a very long time, so what they were building was really interesting. So those are two probably of the more recent, really interesting, mobility related investments.

Cohen: Yeah, that’s interesting, because I feel like the helmets have innovated a little bit on the fashion side, so they’re not just the traditional kind of, like, racing helmets anymore. Right? So now you have some more interesting kind of messenger style helmets and so forth, but I think on the functional-plus-fashion side, I think, is where Park & Diamond is really innovating there on that front. So that’s pretty cool to see.

Sisson: Right. I mean, and you hear people when you ask them why they aren’t wearing a helmet it’s typically, “They’re bulky. I don’t want to carry it around.” And so the two guys from Park & Diamond where—that was what they were focusing on. You know, they really wanted it to be fashionable but also functional and convenient for people to use.

Cohen: Well, I think that’s so important, because, you know—and it’s probably, as you know and I feel pretty strongly about, is that there’s not going to be just one solution to how we move around in a city.

Sisson: Right.

Cohen: And it’s going to depend day-to-day on where you need to go and who you need to see and what errands you need to run and so forth. And so I think having a kind of flexible type of amenity as it relates to helmets, I think, is really nice because then you can just have it in your bag and it’s always with you if you need it, and if you don’t need it it’s not a big barrier.

Sisson: Absolutely.

Cohen: And obviously the big win here is going to be the actually getting protected bike and low-speed mobility lanes so that you don’t have to worry as much about the potential of getting hit by a car and needing that helmet. So that’s obviously the best-case scenario, but until then.

Sisson: Right. Yeah, I mean, pedestrian deaths are up, I think, 50% in the last 10 years, biking and pedestrian deaths. I mean, I think they’re the highest this year since 1990. So obviously it’s an infrastructure issue, but it’s also, like, how do we protect ourselves when we’re out there, you know, out on the roads either on our bikes or our scooters? And, you know, we want to be a part of that conversation.

Cohen: Oh, that’s exciting. So most of the folks that I’ve had on this podcast have either been on the public sector side as an elected official or an implementer of, like, city policy, so forth or on the advocacy side. And you’re really in kind of a different role. I mean, you’re in this place where you’re providing capital to the private sector to tackle these issues that obviously I think are obviously super important and, I think, cities need to be tackling and I think cities are tackling. But you’re really tackling it from the private sector side. And so I’m really curious what some of the pluses of this approach are, maybe even some of the limitations as well of trying to solve this problem kind of from the private sector side, if you will.

Sisson: So, I mean, I’ll start off by saying that we like the government and we obviously respect the government. We see it having a fundamental role in the future of cities, and we don’t think that the private sector or the public sector will be able to solve all of our issues. I think with startups working in the private sector, obviously, there is that sort of grow fast, innovate, learn, pilot—you know, there’s innovation that moves very quickly. And for a lot of these companies that we’re investing in they sort of will compliment existing government functions.

So, you know, like I was just talking about Circuit; they’re not going to replace public transit. We would never want them to replace public transit, but they sort of fill in the gaps of where the government hasn’t been able to. So, yeah, people could take buses, but there is also sort of that app experience, that door-to-door experience that people really crave. And, you know, in so many ways there’s a lot of the startups that are in urban tech that are maybe creating congestion, you know, Uber and Lyft for example. And so, you know, and we obviously never invested in Uber or Lyft, and personally I do think that they just cause more problems probably than they’re solving, but we do see that there are a lot of areas that startups can solve fundamentally. And a lot of times the startups will also kick-start public sector innovation as well. So it’s sort of a two-way street.

Cohen: Hmm.

Sisson: So a lot of our startups are actually selling more direct to customer and to business, so I would say maybe only 15% of our portfolio is selling directly to government. But when they are selling direct to government we try to think of sort of parallel routes that they can take when they’re selling direct to government because we do know that the sales cycle can be slow. Things just move a little bit slower when you’re actually selling to the government, so a lot of times people will pilot at business improvement districts or work with BDCs to sort of get that innovation out in sort of quasi-government feeling.

So, like I said, we definitely respect the government. We want to work with the government. There’s different philosophies on how startups should function when it comes to government and regulation and policy. For some folks, they want to confront them; they want to change things; they want to sort of disrupt; they want to hack it. For us we want to try to work alongside and figure out how we can grow and innovate together.

Cohen: Interesting. Are there any particular maybe lessons or good examples or anecdotes from some of your portfolio companies or even the network, you know, Urban Us at the VC level that has kind of highlighted that collaborative approach with government as opposed to kind of the combative or ask-for-forgiveness approach? Anything come to mind that might be an interesting story to tell?

Sisson: Well, you know, I can say what we look for in a team, which I think is maybe hitting on what you’re saying. Like, for us when we’re looking at a startup and they’re maybe going to a space that is either highly regulated, there’s a lot of policy conversation, or it’s highly political, we like to look at the makeup of the team and say, “Who on this team knows this space?” and not just the fringes of the space or maybe have felt the problem of the space but truly understand all the nuances in this space.

And so if we’re looking at a company, let’s say, that’s in energy and they’re having to do with batteries or they’re having to do with solar, who on the team truly understands all the zoning issues in dense cities when it comes to batteries and, like, understands what the fire departments in different areas are saying about these batteries, you know, and understands, like, the future of solar in dense cities, again? So, you know, it really comes down to who on the team is the expert. And, you know, we would never want to invest in a company that sort of kind of knows the space, wants to dip their toes in the space. To us it’s fundamental to the core of the company who on the team can really lead on the policy and regulatory spaces.

Cohen: So wanting to see a little bit of that experience as opposed to just a want-to to tackle that, having that experience ahead of time kind of helps reduce some of the risk for you as an investor?

Sisson: Absolutely. I mean, and if you think about it we invest in urban tech. There’s a lot of people that live in cities and feel the issues in cities that probably want to solve a lot of these issues in cities, but that doesn’t mean that they’re really equipped to necessarily build a large, scalable company. So we do look at the makeup of the team, you know, founding teams, you know, who understands the tech, who understands the business, who understands the regulatory spaces if applicable; not always applicable, but, you know, if it is. So those are the sort of interesting parts, I think, of being in the private sector versus the public sector as well.

Cohen: As you’re looking at this from the private sector, you’re working with the public sector, you know, obviously you’ve got a whole range of different companies or areas that your portfolio is kind of—companies are selling to and marketing to and so forth, are there any things that you see bubbling up that are getting in the way of building the cities that we want? Like, what’s getting in the way of success to create this future that I think all of your different portfolio companies and then the network at large is kind of looking to do? You’re looking to build this city that is climate resilient and safe to move around and so forth and efficient and so forth. What’s getting in the way of that? What’s missing now?

Sisson: It’s a couple of things. So, you know, the public sector is sometimes slow to take on a lot of this innovation. And it’s of course understandably so. I mean, a lot of this innovation can be dangerous; it can, you know, make inequality worse; it can make being in a city dangerous. Right? And so, you know, I understand that the responsibility of the public sector to consider all aspects, a lot of this innovation.

I think—you know, and not to harp on the scooters too much, but I think the scooters are a perfect example of sort of, you know, they can help with micromobility; they can get people from point A to point B, reduce the amount of congestion of cars, reduce greenhouse gas emissions; but at the same time, A, they’re not usable by everybody; B, they can be very dangerous; and, C, a lot of the cities don’t have the infrastructure that they need to operate these scooters.

Cohen: Right.

Sisson: So they don’t necessarily all have protected bike lanes. So, you know, and I think that’s part of it, is, like, there is that gap between the private sector and the public sector in how they work with each other. So my entire career I’ve always straddled between the private sector and the public sector, and I can sort of speak both languages, if you will. I know a lot of people cannot, and so a lot of cities still keep—you know there’s still this silo, and people are innovating, and then people are wanting to sort of understand the innovation more, and they’re not talking to each other.

So, you know, and I think, you know, New York—I live in New York, so I understand probably New York the most. They’ve been trying to figure out ways that the city can really talk more to people that are really innovating in urban tech. And so they created a group called The Grid. The NYCEDC created The Grid, and it’s everything from, you know, VCs, startups, academia, nonprofits, and of course the city to come together and talk about what are the things that we’re focusing on in urban tech and how can all of these facets of living in a city really understand what urban tech is doing for all of us.

And so I think for me, like, I really do think that if more and more nonprofits, academia, public, private sector sat in the same room and thought about the consequences and the benefits of a lot of this technology, more things could happen. Because, you know, I do believe that a lot of people rightfully so have their complaints about things. You know, there is some innovation—there’s a lot of innovation that really only benefits certain people in society.

Cohen: Sure.

Sisson: And we want to make sure that this technology, this urban technology is benefitting the majority of people and keeping a lot of people safe and making other people’s lives easier and better. So I think it’s a lot of the sort of communication between the private and the public sector that slows things down, the lack of communication.

Cohen: Got it. Got it. And you alluded to the fact that this is maybe one of your secret powers, is your ability to translate between the private sector and public sector, so I want to dig into that a little bit. Like, maybe what’s maybe the one biggest thing that you could tell our audience about how best to translate between the public sector and the private sector? And I know that may be a hard question to ask because you probably do it pretty intuitively, but if you maybe have one way to summarize how to do that better, what would you recommend?

Sisson: My biggest recommendation is for the private sector to understand how the public sector works and to understand all of the hats that they have to wear when it comes to protecting society, so, you know, fundamentally understanding how government works, what government’s role is supposed to be. You know, it’s so quick to say, “Oh, public sector is slow,” or, “Public sector is lazy,” or, you know, all of the other misconceptions that people say about the public sector. Public sector does want to innovate. They want to make life better, you know, for the most part. You know, I could say a lot of these progressive cities really do want the best for the people that are living in it, but there’s just a lot of considerations to take into play. You know, and there’s all different people that aren’t always happy about this innovation.

You know, I was knocking on doors a couple months ago in my community, and it’s an older community. And a lot of people were like, “We hate these Citi Bikes. We hate them. They’re horrible.” You know, they really don’t want these people riding their bikes on their streets. And one lady said, you know, “Instead, I’d like to see more parking.” You know, so there is always that sort of view. For elected officials in the public sector they have to consider a lot of people’s perspective.

Cohen: Sure.

Sisson: But on the other side, you know, on the public sector side I wish that they reached out to the private sector more to talk about these things and to hear more about this innovation. A lot of the local universities have a ton of innovation going on; accelerators have a ton of stuff going on; VCs really have a great pulse on the ground; and I wish that there was sort of that cross collaboration. And so, you know, I’m not—I would say both the sides have their faults, but it’s just a matter of talking to each other.

Cohen: Yeah, I totally agree, and I think that talking is what’s going to be necessary in order to get where we need to go. So you mentioned public sector leaders there and, you know, kind of progressive communities and so forth. And so I want to maybe dig into that a little bit. So when you think of public sector leaders that are really doing good work and you’re saying, “Wow, they’re thinking about this the right way; they’re approaching this the right way,” maybe their leading their teams in the right way, so forth, I’d love to—you know, if there’s any particular either people if you want to name them or even in the absence of that, kind of themes or things that they’re doing right, maybe other things that others can learn from that they could apply in their own communities, what kind of jumps out to you as you kind of survey kind of the public sector leaders that you either interface or your portfolio companies interface with?

Sisson: Yeah, I mean, I can explain some of the cities and the things that I’ve observed that I think people are doing really well and on the other side where I actually observe things maybe not going so well. You know, I think LA really sticks out in my head as a city that’s doing a lot of great things. I mean, if you’ve been to LA recently and you’ve gone to the beach, you’ll see that there’s crazy bike lanes. The infrastructure is great, and I know that they’re continuing to expand on it. And LA is of course that city that you think of that you drive and they don’t have public transit, but I know they have expanded their buses and the protected bike lanes.

They’ve adjusted their public gardening. You know, obviously there’s issues with droughts, so they adjusted that, which is something, you know, we don’t really think about or worry about so much especially in urban tech, but, you know, obviously it’s super important. They’ve adjusted the lights that they’re using in public. So LA is really thinking about these things. I mean, LA is one of the largest cities in the U.S. of course, so they have to be on the forefront, but when you think about sort of who is doing the smarter city, the urban tech really well, LA does come to mind. I think recently New York blocking off 14th Street to vehicles is huge.

Cohen: Yeah.

Sisson: It’s huge. You know, being in New York walking down 14th Street and seeing these people on scooters and skateboards and bikes and pedestrians walking with a little bit more ease, you know, they’re not as tense when you’re near cars. So that’s a wonderful idea. And, you know, I believe San Francisco is either doing or just did the same thing with Market Street, and so that is amazing. I mean, to me when I think of the future of cities, I think of less cars; I think of maybe no cars. So those kind of changes are massive, and I know that they’re also butting up against a huge group of people that are for cars. They want more cars. You know, they see the value in cars, so I know that that’s not an easy decision for the decision makers to make, but I do think that’s huge.

I would say that there’s, you know, some other things that maybe didn’t go over as well. And, you know, just to be specific about, let’s say, Hudson Yards in Toronto. To me, if you are doing huge structural change in cities, you really need to understand the communities that are most impacted. And so to me Hudson Yards, you know, a huge, beautiful development, but, like, who is it really benefitting? Who is really going to be—

Cohen: Is this the one in western Manhattan, the western side of Manhattan?

Sisson: Yeah. Yeah, mm-hmm.

Cohen: Okay, yeah.

Sisson: Just a huge development. And, you know, I went over there once. It’s beautiful. I will say it’s gorgeous, but I really think about these high-end shops, these super expensive restaurants. It’s on the West Side of Manhattan. Like, who is this really benefitting? Is this, that money and that time and that energy, how could it have been used to reduce inequality or to really fundamentally improve life in cities? And the same thing with Toronto. You know, I followed it a little bit, what was going on with Sidewalk in Toronto. I think there’s some interesting parts of it. I think turning cities into smart cities has its pros and its cons. You know, a connected city, a connected area with smarter buildings and EV charging and transportation systems that work is wonderful, but I think you really need to understand the community and really get the community’s input in that process. That’s super crucial.

So, you know, and that’s what I think sometimes makes things slower, but it also makes things really helpful for the community, if they’re a part of this, if it’s really changing their lives. So those are some areas that I find interesting. And, you know, I’m excited to see what ends up happening in a lot of these cities that are continuing to make things smarter and to really to adopt a lot of this technology, but I think it’s always talk to the community, make sure the community is a part of it and they have their input.

Cohen: Yeah, it’s interesting. I mean, you mentioned the 14th Street in New York and Market Street in San Francisco, and what I’m really curious about is to see how those pretty big changes, how they will instigate maybe more change by the city. So, like, once you create that first really dedicated restriction of cars there in Manhattan in that way, what can you then do next? Right? And the same way with the Broadway Plazas and so forth, you know, once you start to restrict some of the cars in Times Square and so forth, how does that change and then what else can we do? So I’m interested to see how those can be kind of credible commitments towards the future and also a signal towards the future as well.

Sisson: Absolutely. And, I mean, San Francisco is a perfect example. I mean, they declared a state of emergency over traffic-related, pedestrian-cyclist deaths. And then, you know, they’re going to go and they’re going to close Market Street. I feel like that shows to the community and the people of San Francisco, like, this city is going to take the steps to reduce the amount of cars, to create these protected spaces. And that says, you know, that the city is doing something.

I know that there’s been a lot of outrage about Mayor De Blasio and what he’s done about the pedestrians and the bicycling deaths in New York, and it almost feels—you know, of course closing 14th Street is by no means the solution, because it needs to be more comprehensive, but, you know, I think the public really wants to see some serious structural changes in these cities to make sure that people walking and people riding their bikes and using micromobility are safe. So, yeah. And I think it does just take that one, that one step to prove, you know, it’s not going to be a total collapse if we can’t drive our streets on, you know, two streets in the city. So I think proving that it can be done and that it’s good for society, I think, is just all it takes.

Cohen: Yeah, it’s been really gratifying to see some of the pictures and videos and so forth from both 14th Street and the adjacent streets to see, “Wow. You know, like, it wasn’t a total fiasco,” or standstill or, you know, it actually works. So that’s been—

Sisson: Yeah. And I haven’t dug into it too much, but I am curious to see what the sort of economic development and the increase in the foot traffic for a lot of the stores on 14th Street has been.

Cohen: Sure.

Sisson: And, you know, I’d be curious to go and talk. But I find myself going on 14th Street more now because, first off, it’s interesting just to be on the street in New York where there’s no cars, but it’s also—you know, it’s just way more relaxing.

Cohen: Yeah.

Sisson: So I’d be curious to see. I’d have to dig into it myself, but I’d be curious to see what sort of the economic up has been for those different, small business.

Cohen: You know, I’ve never lived in New York or San Francisco. I’ve mostly just lived in smaller cities, but I image there is a low level of stress that is always kind of coursing through your body that once you’re on, you know, say, 14th Street without cars or maybe I guess in Central Park, I guess, which is—I think they’ve restricted cars in Central Park now. Right?

Sisson: Mm-hmm.

Cohen: So, you know, like, how that actually fundamentally kind of reduces stress levels because you’re just you’re not worried about getting hit. It seems like that’s a—and you’re not dealing with the honks; you’re not dealing with a lot of that stress-inducing kind of city life that we just accept.

Sisson: Yeah. I think you get used to it after a while.

Cohen: Yeah.

Sisson: I think New Yorkers are kind of just used to it, but it’s still very refreshing. And I actually think that’s like—some people say it’s an argument for autonomous vehicles as well, is like it would reduce the stress for both the driver if done correctly and the technology was there. You know, and I think they say—there’s a lot of studies that say people are getting more and more comfortable with the idea of AVs because of that sort of reduce of stress. You know, it’s like there isn’t the human error. So, I mean, if the technology is there, that could be true. But I think that is also, like, a huge reason that people are sort of pro AVs.

Cohen: Sure. Sure. Liz, where can folks find out more about you and Urban Us?

Sisson: Both Urban Us and URBAN-X have a newsletter. So if folks are interested in hearing more about us, check out both URBAN-X.com or Urban.us and sign up for our newsletters. And we also host events at URBAN-X. We’re located in Greenpoint in Brooklyn, so if folks are interested in the future of cities and in urban tech, we’d love for them to check us out and come to some of our events. Our teams that graduate from our program have a demo day, so we typically have two demo days a year, so would love to connect with folks at our events, or they could check us out on our website.

Cohen: Yeah, definitely. And I’m a part of the Urban Us network. They have a Slack community; they have various events that Liz mentioned, so that’s a really great way to kind of keep your eye on what’s going on in the city space beyond just transportation but all of these other areas that are obviously approximate to transportation and impact our lives and cities. So thank you so much for joining me, Liz. I really appreciate you joining The Movement.

Sisson: Of course. Thanks so much, Josh.

F: Thanks for listening. If you like what you hear, head to Apple Podcasts and subscribe, rate, and review this podcast. You can find out more at TransLoc.com or follow Josh Cohen on Twitter at @CohenJP. Be sure to join us next week for another episode of The Movement.

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