The ultimate startup: Creating a New Country

The ultimate startup wouldn’t have a stock ticker, corporate headquarters, or even sell goods and services. It would, however, be held responsible for the welfare of its “customers.”

Creating a new country is one of the most difficult, complicated and riskiest things you can do. But it can also be one of the most rewarding since you’ll have a direct impact over the lives of your citizens.

There are 195 countries in the world today, and most of the newest countries have formed out of conflict. Around two dozen countries were formed in the 1990s alone stemming from the dissolution of the U.S.S.R., Yugoslavia, and others.

Region-capital_country-001 Why haven’t countries been created using the startup mindset – out of careful thought, experimentation, and the desire to make something better? Isn’t it worth trying to make a better government and to make people happier?   Shouldn’t countries try to recruit the best talent from all over the world?

Countries are a lot like Businesses
Countries and businesses share many similarities. In order to survive, countries need to keep their customers (citizens) happy, and they need to generate revenue (from taxes, selling resources and exporting goods, or investing in other countries or corporate entities). Countries also need to form partnerships, abide by certain rules, invest in research and development, and should also have a roadmap for the future.

Unfortunately, most countries today are too similar to large corporations and not enough like startups. They are large, slow-moving, and bureaucratic when in fact they need to be more nimble and responsive to their citizens.

No Easy Task
Like forming your own startup, there is a long list of things that need to be thought through before you can create a new country: Where will you be based? Who are your first citizens and how will you encourage them to join you? What type of government will you establish? How will you raise money and how much do you need?

Countries could even be landless (though you should be able to negotiate with a country to buy their land).  Getting land for your country would be difficult, but startups always have serious disadvantages when competing with entrenched players.

Once you get a certain number of people (so we know there is demand) and backing of a certain number of dollars (so we know the country is viable), you should be able to have a charter country in the United Nations. 

There are many more complex issues that would need to be thought-through first, and even if you were able to address all of them, there would still be a lot of risks and on-site learning. But daunting tasks have never kept entrepreneurs away from trying to accomplish their goals.

People should be encouraged to start countries.  Not only is there is a monopoly on starting your own country but there is also a lot of upside for your citizens.  Breaking down the barrier to create and develop countries will require much trial and error, but innovation and progress only happen through experimentation.

Darwinism also applies to the nation-state just like it applies to companies and besides, a little creative destruction is a good thing. 

Special thanks to Michael Hsu for his thoughts and edits and Shervin Pishevar for his inspiration.

14 thoughts on “The ultimate startup: Creating a New Country

  1. Mrschwabe

    Businesses are becoming more and more like countries all the time; so this is definitely a relative analogy.
    Perhaps you can try launching a country after conquering the business world 🙂

    Reply
  2. Paul

    I think this is a terrible idea.
    Most startups fail. Most businesses are dictatorships. People don’t seem to need any encouragement trying to start countries, it’s at the root of many of the world’s wars (hostile takeovers).
    I don’t see the business world as a good role model, but it seems to be the trendy panacea of our day.
    “But it can also be one of the most rewarding since you’ll have a direct impact over the lives of your citizens. ”
    You’re beginning to sound like a dictator already – you’re starting a country just for me so I can praise you for how great you were to do this for me. All praise our glorious CEO!

    Reply
  3. Adrian Bye

    Haiti is an example of a failed nation-state with tragic consequences for millions of people.
    As I travel more and more (50 countries so far) I see that too many countries were formed just by random coincidences — yet since people are born there, they feel a strong connection with their “culture”.
    But cultures come and go, exactly as Darwin weeds out species and companies.

    Reply
  4. Tim Dick

    Perhaps many new countries are already successful by the definition many successful startups: built so their founders (President & executive position holders) and investors (crony capitalists / resource extractors / military leadership) can profit within a short # of years (typically 7 eh?) and then exit.

    Reply
  5. Andy Hunn

    Historically at least, country formation has the inherent ‘least common denominator’ problem – i.e. you can’t kick out the slackers. Perhaps in your new proposal, country citizens could be invite-only.
    I’m reminded of the book Atlas Shrugged and John Galt-land…one of the greats.

    Reply
  6. Justine Lam

    Totally agree that there should be more competition in governments. Are you a supporter of the Seasteading Institute (www.seasteading.org), Auren? They’re building up the infrastructure (engineering, legal, economic, business).
    The Thiel Foundation is giving a matching donation for every donation till the end of this year.

    Reply
  7. Bob Barrett

    All,
    A better analogy than “starting a new country” would be to “restart” this country. Restarts have a much better chance of success. The “invite only” issue could easily be solved by applying certain standards/ basic beliefs, a premise lost on most current politicians mostly interested in their own feather bedding via chairmanships. I think the idea of a “new” country following the ideas on which this country was founded makes great sense. It sure beats fighting a civil war. Let’s follow the example of the Czech Republic-in our case capitalists and people who beieve in a republic and those who prefer socialism.

    Reply
  8. Jake

    Auren,
    You’ve hit on a subject I’ve been thinking about for some time. I think de novo nation-states is a great idea and a fascinating concept to try and work into reality. Clearly the current geopolitical powers-that-be will react to this similarly as wikileaks, but that should be half the fun. The current state of citizen/state relationships is a joke. It should and can be drastically improved using modern mechanisms. Simply upgrading national information technology would yield a drastic improvement, not to mention fundamentally rethinking the role of government in general.

    Reply
  9. Vince

    It is a great idea. But you can’t do it legally! No government is going to sell you land. That hasn’t happened since Alaska purchase! You are going to have to fight for land, like most every other nation on earth.
    The real revolution would be to change the national and international laws, so that people can secede easily and start their own governments.

    Reply
  10. richie hecker

    Actually you can buy islands. Virgin has an island. There’s a number of islands that can be bought or you can build one like in dubai!
    What are we waiting for ? Whose in? I call President.

    Reply
  11. Kennedy

    West-Coastia [or whatever you want to call it: the consolidation of WA/OR/CA] can have the world’s 4th-5th largest economy, with global dominance in technology, entertainment, agriculture [including wine], defense, and transportation: the ports of Seattle, Portland, SF/Oakland and Long Beach can control all incoming shipments from Asia and charge tariffs [choose your adjective: adequate, excessive, punitive, ???] for trans-shipment of all that stuff to buyers in the Fly-Over States …
    We change the balance of payments from net-negative tax dollars incoming to all dollars incoming, and we’re no longer subject to the rule of people from Whichever Dakota ….
    There are holes in this …it might have to be a rule that you cannot be a government official if you ever served in the CA legislature … but it’s so much more palatable than what we have …most of the other issues here are due to short-sightedness …
    In the end we’d avoid the Startup Failure issue by having a globally dominant market share from Day One: too big to fail!
    Yes? Shal we?

    Reply

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