October 10, 2018
There are currently more than 12,000 economic development agencies across the country, tasked with promoting economic growth within their region. And because tech is such an exportable industry with high-paying jobs, tech startup economic growth is usually high on their priority list.
And, as is commonly pointed out, there are four main pillars that are needed to have a good ecosystem:
1) Established companies – foundational companies, like the Apple, Google, and Facebooks of the world – as well as smaller, yet still established companies, help newer startups in several ways. They supply capital, talent, and serve as early-adopter customers, to name just a few.
2) Strong university systems – An obvious one, but worth mentioning as universities provide yet another vital source of intellectual talent. Growing hubs like Boulder (University of Colorado), Austin (University of Texas), as well as the established hubs in the Bay Area (Stanford, Berkeley) and Boston (Harvard, MIT) are a few of the many cities on the list of startup hubs.
3) Mentorship opportunities – While many talk about the need to have easy access to Venture Capital, the value they provide is much more than financial. Learning from those who have gone before them – and are able to make introductions to people that can help a startup grow – is one of the most valuable relationships an entrepreneur can have. Established hubs with pillar companies provide the right mentors for helping newer entrepreneurs navigate the myriad challenges of starting a business.
4) An ample talent pool – Successful startup hubs are successful because they have the human capital to think, create, do, and make. Smart people with big ideas are imperative, and established hubs have them. Moreover, as employees consider jumping into the startup world, it’s a lot easier to stay in the same city rather than up and move an entire family.
One of the more overlooked pillars is real estate. Tech hubs grow in large part because there’s already talented employees there – large companies flush with capital haven’t minded paying the exorbitant prices we see in the Bay Area, Seattle, and New York to have easy access to the best talent.
But as we’re seeing with Austin, Boulder, Atlanta, and the other growing tech hubs, this is shifting rather quickly. Showcasing flexible office space available – along with the other pillars – builds a strong case for any economic development agency that’s looking to attract more tech talent and grow their regional economy. Keeping an eye on listings for the most up-to-date data and trends can make a strong case for any startup looking for a home to build their company – if they can add years to their runway just by moving out of San Francisco, companies are excited to jump as long as the other pillars are met.