Columbus, OH – Building the Startup Ecosystem

Today’s post comes by way of Brian Zuercher, the CEO of FlyMuch.com in Columbus, Ohio. In it, he describes his experience returning to Columbus as an entrepreneur four years ago, some background on Columbus, and two specific lessons that he’s learned: (1) stop trying to be Silicon Valley and (b) take the long view.

Reid Hoffman describes entrepreneurship as jumping off a cliff and assembling the plane on the way down, and this seems to hold true for entrepreneurship no matter where you live. The difference for an entrepreneur in Columbus, who decides to jump off the cliff, is that he or she will also need to wear the hat of entrepreneurial eco-system builder. In other words, the entrepreneurs need to assemble the plane, and source all the parts (recruit crazy people to work for you), find thermal updraft (funding), and convince some passengers to ride this extremely risky flight (evangelists, government, etc.).

It’s been almost four years since I returned to Columbus after a decade gone for school, work and more school. We returned to Columbus for many of the reasons people return to where they grew up. The one difference in my thought process, albeit naïve maybe, was that I believed you could start a company anywhere and make it happen.

Now that I am in my 4th year back, I know what is in front of me and it’s a decision many entrepreneurs in Columbus and cities like Columbus will face. Entreperneurs will have to wear two hats for their foreseeable future. One hat is that of the entrepreneur for their company and the second hat is that of the entrepreneur for their community. The main challenge this creates for entrepreneurs is time and stamina. The difficulties and stress associated with entrepreneurship are already tough, so the key is to know the hurdles in front of you before you start.

First, a little background on Columbus.

Columbus, OH has many of the ingredients that are not easily replicated in other cities. We have one of the largest universities in the country in The Ohio State University, a relatively large base of experienced corporate IT staff, and generally a nice (lower cost) place to live. With the exception of mountains or an ocean, we are ahead of most cities that are trying to build entrepreneurial eco-systems.

There is a unique size to cities like Columbus. Cities like Columbus that have just shy of a million people in the city and another half million in the metro area, have a small enough size that navigating the network to find people is still relatively easy, but still enough people to warrant corporate investment and workforce build.

Within two weeks of my return to Columbus I had coffee with an incubator representative, attended Startup Weekend, and created my first company. The problem in cities like this is not getting to the right people; it’s what happens next. We started our company and had revenue and traction in the first few months. This sounds like a story most entrepreneur’s dream of. The challenges started when there was really nowhere for us to go after that. We tried to get some local incubator funding, but the committees voting were scared of web market and it’s uncertainty. Additionally, most angels in Columbus had backgrounds as Doctors, Lawyers, Corporate Execs, etc., but not as ground up entrepreneurs, which ultimately meant they were extremely risk averse and not interested in funding any deals that did not have obvious cash flow break-even tangible products.

It’s easy to get frustrated when you get into these situations. The easy answer is to just move to somewhere like Silicon Valley where the ‘get it’ crowd around new tech and funding is already at critical mass. There is a ton of bad logic in making a decision like that, and I continually fight my own pull towards it.

There are two lessons I have taken away from my early experiences in Columbus.

1. Stop trying to be Silicon Valley. Columbus is constantly being ranked the ‘Next big tech city’ or whatever. It makes me want to vomit when I hear this, because inevitably the next week some local paper says puts out a headline that says, “Is Columbus the next Silicon Valley?”. The answer is and should be NO. Columbus is going to be – Columbus version 2.0. It is our job to stay true to the steady, smart backbone that built cities like Columbus, but begin to shift the future economic engine to entrepreneurship. One nice thing about Columbus is its lack of parochialism. Most people ‘from Columbus’ are first generational. The city was relatively small until the 70’s and 80’s, so the benefit is a lack of legacy rewriting. The community is ready for chapter 2 to be written, but it’s not going to be the next Silicon Valley (unless you can move some mountains and an ocean closer).

2. Take the long view. We do not live in a long-view world, so making investments today that will have maturity years from now is really painful. Most people think it’s the money, government or big wins that will make the eco-system build. I would argue the longest and most painful, but ultimately the most important ingredient is Culture. We are trying to change generational thought processes of risk, process and opportunity and it doesn’t happen overnight. To take the long-view you need to celebrate the wins incrementally and set achievable goals that don’t jeopardize the long-term progress.

Finally, some signs of progress.

We recently started WakeUp StartUp, a monthly pitch breakfast for entrepreneurs. What is unique about this meetup is that there is only one requirement: you need an ASK. The ASK doesn’t have to be funding, it can be customers, employees, advice, etc. The first two events we maxed out the venue and it’s continuing to grow with submissions and attendance. The most important aspect of WakeUp StartUp is that the entrepreneurs run it.

I am bullish on new entrepreneurial eco-systems and the people building them. My advice to entrepreneurs is to treat your community like a startup your investing in. This let’s you transfer your hats you have to wear a little more smoothly.

Our motto here is “why the hell not Columbus.”


Florida Innovation Hub in Gainesville Florida

In the book Startup Communities I spend some time talking about how universities can be powerful feeders into a startup community. A blog reader sent me a note pointing out the Florida Innovation Hub at the University of Florida in Gainesville, FL as an example of what is going on in the community. They’ve got a nice glossy video describing the Florida Innovation Hub.

This is the first of 7 structures on a 20+ acre plot of land dedicated to entrepreneurship and commerce. It’s a great example of what a university can do to help a startup community.


Notman House – Montreal Co-Working Space

I’ve written a lot about the importance of entrepreneurial density. This is especially true in large cities, where it is even more important to have tight clusters (or neighborhoods) of entrepreneurs.

Recently I received an email from Ildar Khakimov about the Notman House, a Montreal co-working space in the heart of the city aimed at being the home of web entrepreneurship in Montreal. Ildar is the volunteer community manager for Notman House and justifiably proud of what they are doing.

Several of the members of the Montreal startup community, including Real Ventures and the Osmo Foundation are responsible for the birth of the Notman House project. Several specific people who drove this project are John Stokes, Alan Macintosh and Mark MacLeod.

Notman House has some great public spaces and regularly hosts events for the startup communities. There’s a wiki, email mailing list, and Hackademy. A web cafe and offices for rent round things out.

Notman House is a very large historic property which is joined by a tunnel to an old hospital. Currently the hospital space is not used, but there is a goal to transform it into a place where startups would be able to work in teams for a period of several months. You can easily envision an accelerator being housed here.

Co-working spaces are quickly becoming a main stay of any startup community. Montreal is off to a good start with Notman House.


Chicago’s Startup Community – New Reasons To Live In The Windy City

Troy Henikoff, one of the founders of Excelerate Labs and one of the leaders of Chicago’s startup community sent me an update on what’s going on in Chicago. It’s pretty awesome and is a great example of what happens when entrepreneurs take a long term view to building their startup community. Here are a few of the things going on that Troy mentioned.

BuiltInChicago – just over a year old and has over 6,000 entrepreneurs and 15 – 20 blog posts a day on what is happening in Chicago

Technori Pitch – sells out a 500 seat auditorium each month to hear 4 – 5 startups pitch

TechWeek Conference - a week-long festival celebrating the technology, web and interactive communities

Entrepreneurs Unpluggd – Awesome event each month to hear from 3 entrepreneurs on a variety of topics

CodeAcademy – a 90 day intense in person curriculum that teaches people to be coders

1871 – a new 50,000 sq ft co-working space opening next month it is totally entrepreneur focused and is a 501(c)3

FireStarter Fund – 42 successful digital tech entrepreneurs start an innovative fund to help early stage Chicago companies with capital and access to mentorship

Excelerate – Forbes ranked us the #3 accelerator in the country this year – applications are open until March 16th

The BuiltInChicago site has a great summary of 2011 along with a list of Chicago companies. It seems like it’s time for me to get my butt to the airport, hop on a United flight, and spend a few days in Chicago.


A Community A Week Next Week

As I’ve been working on the Startup Communities book, amazing stories about different startup communities around the world keep coming in. I’m going to put up one a day next week, starting with Chicago.

If you’ve got a story about your startup community that you want to tell, feel free to email me up to 1000 words with links. At the minimum I’ll post it on this blog and possibly try to work some of it into the book.


Boston’s Amazing Comeback

Five years ago the buzz about Boston was that it was a has-been in the innovation economy. As someone who lived in Boston from 1983 – 1995 and helped start and invest in many companies there over the years, I knew this was nonsense, but like any cycles (even if the cycle is part of a meme) it needed to bottom out before people really kicked into gear. And they have – Boston (which includes Cambridge) is once again an example of a hugely vibrant startup community.

Three posts in the last two days caught my attention on this. The first was from Fred Destin, a VC at Atlas Ventures who is also a transplant from Europe. He wrote a great, detailed post titled Built in Boston: Why Great Entrepreneurs Are Choosing MA to Build Their StartupsIt’s substantive and full of examples of companies and entrepreneurs who are building the Boston startup community.

The next post was from Jeff Bussgang, a VC at Flybridge Capital Partners, titled What Makes The Boston Start-Up Scene Special? Jeff recently updated a presentation he gives by the same name as the post and reflected on how much it had changed in the past few years. The presentation is worth going through it you are interested in the resources of Boston and what’s going on in the community – it follows.

Finally, Scott Kirsner is building on the theme I started in my post titled I’m In Cambridge, Not Boston by exploring the concept of neighborhoods in a startup community. The notion that a startup community is a “collection” of startup neighborhoods is an important one and Scott’s post titled The Innovation District’s Four Neighborhoods does a nice job of laying this out. I’m not sure if this is too fine grained – I used to live at 15 Sleeper Street and two of his four neighborhoods – Fort Point Channel and Fan Pier are easy walking distance (so they probably should be the same neighborhood) – but the premise and general analysis is correct.


Upstate New York A Year Later

A year ago I spent two days in Upstate New York meeting with a bunch of folks working in and around the entrepreneurial community at the request of my long time friend Martin Babinec and his partner Nasir Ali. I wrote a summary post titled Two Days of Entrepreneurial Community Building In Upstate New York.

Today I noticed a post titled Early spring for Upstate NY entrepreneurs on the StartFast Venture Accelerator site (Martin and Nasir’s accelerator that is a member of the Global Accelerator Network.) I thought it was a good summary of what’s going on right now in the region and asked if I could republish it. The post follows!

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2012 is shaping up to be a great year for our entrepreneurs with lots of events to attend and successes to celebrate.

EXITS:  Hot on the heels of recent exits for Sensis (Syracuse), Kionix (Ithaca), and Paetec(Rochester), Buffalo-based Synacor debuted on the NASDAQ this past week, creating liquidity for two of the region’s early stage investors: Rand Capital and Advantage Capital.

FINANCINGS:  The Seed Capital Fund of CNY (a StartFast investor) reports that four portfolio companies are expected to close about $7MM in new funding this quarter.  In addition to SCF, participating investors include Cayuga Venture Fund, Rand Capital, Eastern NY Angels and several out of state angels/VCs.

STARTUP WEEKENDS:  Last November’s sold out events in Ithaca and Syracuse showed just how much talent is locked up in our region and the many serial entrepreneurs who are ready to mentor a new generation of startups.  This year promises at least four to six more such events, beginning with Albany in March and Rochester in April.

MEETUPS: Just a year after its launch, the Syracuse Tech Meetup group continues to grow in size and popularity, drawing hundreds of attendees.  The next meetup is February 28 and offers startups a chance to meet organizers and mentors from the StartFast and Student Sandbox accelerators.

Subscribe to the Upstate Venture Connect calendar via RSS to stay in the loop on future events.


The Roots Of The Boulder Internet Community

It’s fascinating to go digging for the roots in a startup community. There’s a rich entrepreneurial history in Boulder that pre-dates me arriving here at the end of 1995 that covers a lot of different industries, especially storage, telecomm, natural foods, and life sciences. While the rise of the commercial Internet really took off in the mid 1990′s, the seeds for it were planted in the 1980′s and early 1990′s.

Ned McClain, the co-founder and CTO of Applied Trust (who’s office is across the street from mine) wrote me a great history of the Colorado Internet Cooperative. It includes several key entrepreneurs in Boulder’s Internet scene, including Andrew Currie, Barb Dijker, Evi Nemeth, Trent Hein, and Herb Morreale.

Following is the short version of the story that adds nicely to the history of the Boulder startup community.

The Coop began as a member-owned ISP – providing T1 lines to Colorado startups (and other businesses) that would otherwise have not had Internet service at a small fraction of the price the Tier 1 and 2 providers were charging.  The Coop started officially in 1994, but the core team was deploying Internet access to commercial customers as early as 1991 (under Colorado SuperNet, (at the time) a not-for-profit).  My business partner Trent Hein worked closely with other Boulder tech leaders like Andrew Currie, Barb Dijker, and Evi Nemeth (from CU) – and others – to make the Coop a reality.  In my opinion, the Coop’s cheap connectivity/bandwidth was a key ingredient in the Boulder area’s early successful Internet startups.  Prior to the COOP, Colorado was a bandwidth desert – it hadn’t attracted the investments necessary to build widespread commercial data infrastructure.  I would be really surprised if there was a tech company started in the early 90′s that didn’t use the Coop, or a Coop customer, for access.  

Trent, along with Herb Morreale, founded XOR in 1991, which was one of the earliest web companies and I am pretty sure one of the first companies to do any form of ecommerce.  He has a ton of amazing stories about the early Internet days in Boulder/at CU.  Trent and Evi were two of the key engineers to investigate and remediate the Morris Internet Worm back in 1988 – since CU was such a huge component of that first-ever Internet security incident, that story might be an awesome fit in your book.

Here’s a quote from a recent chat with Trent re: his work at CU in the late 80′s:  “I can still remember getting up early on snowy mornings to go thaw out the satellite dish that provided the 56Kbps link to the WHOLE campus.  There was no fiber or even T-1.  We had 56Kbps satellite, when it wasn’t iced over.”

If you were a part of this, feel free to add on to the history in the comments. While I haven’t worked closely with Barb, Evi, Ned, or Trent, I co-founded Email Publishing in 1996 with Andrew Currie and Brian Makare and have worked on several projects with Herb Morreale’s (and ran at least one marathon with him) over the years. It’s pretty fun to reflect on where things were, how they evolved, and where they are now.


Startup Communities Are Everywhere – Even Cardiff

I have a deeply held belief that you can create a long term Startup Community anywhere in the world. To do this, you must have leaders who have a long term view and commitment to the Startup Community. These leaders must be entrepreneurs and must commit to a 20 year view.

It makes me smile when I get emails from folks like Neil Cocker, the founder of Dizzyjam in Cardiff, Wales.

“I’ve been jealously eyeing up Boulder recently as a great model for what a small city can do to create a vibrant startup scene (I’ve been picking the brains of my old University friend Tobias Peggs of OneRiot about it), as Cardiff is three times the size of Boulder, but with almost zero startup activity to speak of.”

Tobias is a good friend of mine and and awesome guy so any friend of Tobias’ is automatically a friend of mine. Neil went on to write a great post titled Cardiff’s Startup Culture – What can we do about it?. If you read Neil’s blog, you can see the energy, passionate, commitment, and desire to create a real startup community. He’s asking all the right questions – now he’s just got to rally a half dozen entrepreneurs to go on a 20 year journey with him.

Neil – call on me any time if I can be helpful.


David Cohen In San Diego Talking About Entrepreneurial Communities

David Cohen, the CEO of TechStars, spent the day in San Diego on Thursday and Friday. He wrote a great summary of a talk he gave – that sounds like it was more of a discussion than a talk – titled San Diego and Entrepreneurial Communities. If you care about this stuff, wander over and take a look at the seven things he said to the dinner group to spur the discussion.


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