When you’re part of America’s oil and natural gas sector, you know the names of many of our industry’s largest players—companies such as Chevron, BP, ConocoPhillips, ExxonMobil, Shell, Halliburton and many others.
What’s less well known—inside and outside our industry—is that the oil and natural gas sector is supported by tens of thousands of small businesses employing hundreds of thousands of people.
Many of these businesses provide essential, established operations, such as transportation and warehousing. But our industry also includes newcomers—small companies driving innovation in E&P, materials, energy efficiency, water management and more.
In addition to spurring energy innovation, these entrepreneurial companies provide an important foundation for business growth and job creation. The energy sector’s entrepreneurial ecosystem benefits from an engaged investment community, academic support, and the leadership of larger companies. In addition, positive public policies play a critical role in promoting energy sector entrepreneurship.
Private Sector and Academic Support
Some entrepreneurs fund their own startups, also known as bootstrapping. But many entrepreneurs, even if they bootstrap at first, will seek outside investors. Fortunately, some venture capital firms specifically seek out investment opportunities in oil and natural gas. Some business incubators, such as New Orleans-based ENERGYx, also nurture oil and gas startups.
Larger energy companies, like many high-tech companies, also have their own venture capital operations. For example, Chevron Technology Ventures (CTV) invests in businesses for financial value, but also for access to new technologies. CTV helps startups with seed money but will also provide capital to enable established small businesses to expand.
Universities also play a role in promoting entrepreneurship in the energy sector. Last year, for example, Texas A&M launched its Petroleum Ventures Program, which brings together business and petroleum engineering faculty.
The Role of Public Policies
No business—entrepreneurial or otherwise—can grow and thrive without a pro-business policy environment. Our industry benefits from public policies that promote innovation and investment, and minimize regulatory and tax burdens. Key policy issues impacting entrepreneurial opportunities include:
• Taxation—Energy companies are less attractive for investment and have fewer dollars themselves to invest when they are singled out for higher taxes.
• Regulation and Access—When energy is limited geographically—e.g., most offshore areas are off limits to energy exploration—or by overreaching regulations, moratoriums and flat out bans, investment opportunities can be negatively affected.
• STEM Education—Federal and state educational policies should support advanced learning in science, technology, engineering, and math (STEM). To build a workforce of future energy entrepreneurs and innovators, STEM education, starting in K-12 schools, is essential.
The best way for members of our industry to support positive, pro-energy, pro-business public policies is by participating in API’s Energy Nation program. A workforce advocacy organization operating online and on the ground, Energy Nation keeps energy employees informed about key public policy developments and helps you make an impact in the policy arena.
We can help our industry today, as well as tomorrow’s energy entrepreneurs, by standing up together to support policies that foster small business growth, drive innovation, and strengthen our ability to provide oil and natural gas to our nation and markets around the world.
To learn more about Energy Nation and its mission, visit www.energynation.org.