Tag: entrepreneurial communities
Last week I posted an article on peHUB titled How to Create a Sustainable Entrepreneurial Community. Here it is in its entirety.
I’ve lived in Boulder for 15 years after living in Boston for a dozen. While I’ve spent a lot of time in Silicon Valley — both as an angel and venture capital investor — I’ve never lived there. While the firm I’m a partner in — Foundry Group — invests all over the United States, I regularly hear statements like, “The only place to start a tech company is in Silicon Valley.”
When David Cohen (CEO of TechStars) and I co-founded TechStars in Boulder, Colo., in 2006, we had two goals in mind. The first was to energize the early stage software/Internet entrepreneurial community in Boulder. The second was to get new first-time entrepreneurs involved more deeply in the Boulder entrepreneurial community. Four years later, we feel like we really understand how entrepreneurial communities grow and evolve.
First is the recognition that Silicon Valley is a special place. It’s futile to try to be the next Silicon Valley. Instead, recognize that Silicon Valley has strengths and weaknesses. Learn from the strengths and incorporate the ones that fit with your community while trying to avoid the weaknesses. Leverage the natural resources of your community and be the best, unique entrepreneurial community that you can be. Basically, play to your strengths.
Next, get ready for a 20-year journey. Most entrepreneurial communities ramp up over a three- to five-year period and then stall or collapse, with the early leaders getting bored, moving away, getting rich and changing their priorities, or just disengaging. It takes a core group of leaders — at least half a dozen — to commit to provide leadership over at least 20 years.
But these two things — playing to the strengths of your community and going on a 20-year journey — are table stakes. Without them, you won’t get anywhere, but you need more. In Boulder, we’ve figured out two critical things for creating a sustainable entrepreneurial community.
First, do things that engage the entire entrepreneurial community. Over the years I’ve been to many annual entrepreneurial award events and I’ve gone to endless cocktail parties for entrepreneurs. These are nice, but they get boring quickly. More importantly, these types of events don’t actually engage anyone in anything functional — you end up seeing the same old people and saying the same things to each other.
You need to take the next step and create real events that have entrepreneurs work together on a regular basis. Meetups and Open Coffee Club type events that occur on a regular basis are a great start. Hackathons, Startup Weekend, and Open Angel Forum events are the next level. Events at the local university, such as CU Boulder’s Silicon Flatirons programs, including Entrepreneurs Unplugged and Entrepreneurial Roundtables, involve the entrepreneurial community with students who are the future entrepreneurs in the community. And programs like TechStars — which engage the entire entrepreneurial community for 90 days a year — are the icing on the cake.
Next, you have to continually get fresh blood into the entrepreneurial ecosystem. It has to be easy for a new entrepreneur to emerge in your community and get connected with the experienced entrepreneurs and investors. If someone moves to your community, it has to be easy for him or her to engage. Experienced entrepreneurs and investors should want to work with new entrepreneurs and new entrepreneurs should have their minds blown when they move from their otherwise dull and disengaged community to your exciting, welcoming and engaging community.
We are in the midst of an entrepreneurial revival across the United States (and the world) right now. Hopefully we’ll learn from the past cycles and do things to keep things going this time around so that in 2025 there are numerous strong entrepreneurial communities throughout the United States. My partners and I at Foundry Group look forward to helping nurture many of these communities with investments and our engagement over the next 15 years.
During the Tahoe Tech Talk three hour Q&A segment with the panelists, someone in the audience asked about how to create a stronger entrepreneurial community in their city so that it could be “more like Silicon Valley.” After a little banter, Chris Sacca and Dave Morin called me up onto stage to do a short riff on what we’ve done in Boulder and what makes it special. Damon Clinkscales recorded it on his iPhone – the three minute video is embedded below.
The key points are:
- Don’t try to be Silicon Valley (it’s a special place – learn from it – but don’t try to emulate it)
- It takes at least a half dozen people that are committed to provide leadership over 20 years
- You have to do things that engage the entire entrepreneurial community (e.g. TechStars)
- You have to continually get new first time entrepreneurs into the entrepreneurial community
There’s a lot of stuff about this in our new book Do More Faster in case you want to go deeper on this topic.
Entrepreneurial communities grow up around smart people. Whenever someone in state or local government asks me what they can do to accelerate entrepreneurship, I always tell them to put as much money and energy as they can into education. If you build a broad base of smart, inquisitive, curious people that are long term members of your community (e.g. they don’t move somewhere else), you’ll be delighted with the results over a long period of time (think 20+ years).
Richard Florida, one of the most thoughtful writers and thinkers about entrepreneurial communities, recently identified Boulder as the “brainiest city in the US.” Richard Florida’s first book, The Rise of the Creative Class, is a must read for anyone that cares about entrepreneurship and entrepreneurial communities. It forms the basis for his body of work around the notion of a creative class and has influenced plenty of my thinking in this area.
To get a feel for the data and description that names Boulder as the Brainiest City in the US, there’s a quick slide show (that I can’t embed) that has the following data on it.
- Computer Math Degree Recipients: 7.84 percent
- Science Degree Recipients: 3.15 percent
- Graduate and Professional Degree Recipients: 24.22 percent
This reflects nicely on my post about Entrepreneurial Density from a week ago. 25% of the population in Boulder has a graduate or professional degree. Don’t forget that about 20% of the population of Boulder are undergraduate students. That’s a remarkable number.
I’m heading to Chicago early tomorrow morning to participate in a two day event around this years Excelerate program. Monday is Angel Excelerator 2010 and Tuesday is the Excelerate Demo / Investor Day. David Cohen and I are doing a talk together and we get to watch our friend Dave McClure juggle 500 hats. There are plenty of smart people in Chicago – I look forward to spending a couple of days hanging out with some of them.
Last week I co-hosted a lunch for Jared Polis with Kyle Lefkoff at Boulder Ventures which Jud Valeski covered nicely in his post titled Luncheon with Jared Polis. Jared was one of the first people I met when I moved to Boulder (thanks to an introduction from my long time friend Dave Jilk) and we’ve been great friends and partners on a number of fronts ever since.
The attendees at lunch were a bunch of Boulder entrepreneurs in three areas – software / Internet, biotech, and natural foods. While I spend almost all of my time focused on software / Internet, it’s always interesting to hang out with some of the Boulder entrepreneurs in other segments to hear what they are thinking and working on.
During lunch, I reflected some on the number of times I’ve heard in the past year from people outside of Boulder about how Boulder has become a nationally known entrepreneurial center. The comments come from all over and are often followed by the question “how can we do what you guys have accomplished in Boulder in our city?”
While I was listening to everyone and being proud of the little 100,000 person town I call home, I thought of a new phrase that I hadn’t used before: “entrepreneurial density.” I wondered out loud if Boulder was the “highest per capita collection of entrepreneurs in the US.” I have no idea if this is true but from my travels around the US it feels like something that might be true.
On Saturday morning as I was filling my car up with gas, I ran into someone I know that works at Rally Software. This kind of thing happens all the time – I’m constantly running into, sitting next to, or just saying hi as I wander down the street to people that work at startups in Boulder.
Entrepreneurial density isn’t just the “number of entrepreneurs per capita”, but it’s the “number of people that work at entrepreneurial companies per capita.” It gets even bigger when you include students and calculate the “(number of people that work at entrepreneurial companies + the number of students) per capita.
As ED = ((entrepreneurial_emps + students) / adults) approaches 1, you get complete entrepreneurial saturation. I’m going to guess that Boulder’s Entrepreneurial Density using this equation is somewhere between 0.50 and 0.75, but this is just a guess. I’m curious if anyone out there has a real way to calculate this.