Young entrepreneurs often have trouble accessing capital. Credit: Nick Ares / Flickr Creative Commons

Guest:

• Dave Girouard, Founder and CEO of Upstart

The life of a young entrepreneur may seem pretty cushy: Roll into work at your at home office (possibly in your PJs), program all day with your friends, hit it big.

But the reality facing most of those would-be entrepreneurs is ballooning student loan debt and difficulty securing capital.

Dave Girouard, a former Google executive and the founder and CEO of Upstart, has a plan to improve their odds of succeeding.

Think Kickstarter, except that people invest in the potential of an individual. Then they recoup the investment as that person earns money over time.

Might seem risky — but, Girouard claims, it's not ask risky as investing in the stock market.

“One person may have a lot of variability in their income stream, but if you actually invest across a whole bunch of people, it actually is very low volatility.”

In their model, Upstart uses statistics – a person's work experience, GPA, college major and more – to calculate what kind of money they should get from their backers. It's less about how successful any one company or business plan may be – and more about betting that the person will eventually be earning and achieving no matter what they do. 

Drawing an analogy to baseball, Girouard compares Upstart to the minor leagues, where talent gets nurtured with small amounts of dollars. And some of those players? They’re going to step into the major leagues.

A structure that he thinks will become increasingly important, given the way the job market works today.

“You cannot just expect that your career is going to happen. You need to make it happen and access to capital is very fundamental to that,” says Girouard.

So, get ready to mortgage your future…literally.