Innovation and entrepreneurship: a portrait of possibility
We Create Here was an initiative within the Gazette Company to develop evolving narratives and authentic conversations throughout Iowa's Creative Corridor. read more
Reflecting on the first six months of We Create Here
|It’s been almost six months since I joined The Gazette Company at the launch of We Create Here, specifically to cover entrepreneurship and innovation. It’s been a fun ride: digging deeper into big issues, trying to grow a blog following, getting more involved in the community and producing articles for print.As I reflect, here are a few of the ideas that strike me. What would you add?Story continues after the jump.|
We’re special...but others are too
It’s no secret that in these pages we support the ideas and philosophy of Iowa’s Creative Corridor: that within our seven counties, our mix of large and small towns, business opportunities and diverse cultural offerings (all wrapped in a blanket of "Iowa Nice") make for something truly special. As someone who chose to move here from another city, I have experienced how welcoming this community can be and the joy of discovering the people and places that make this region special.
But here’s the catch — our peer cities and states are right there with us.
In the Kauffman Foundation’s April 2013 index of entrepreneurial activity, which compares rates of entrepreneurship to a state’s population, the top-performing states were Montana, Vermont, New Mexico, Alaska, Mississippi and Idaho. California (home of Silicon Valley) came in seventh. Iowa? 41st. (Although, that might be changing: In another Kauffman study, Cedar Rapids had the third-fastest rate of change in the number of high-tech firms among similar-sized metros.)
We saw this firsthand when the UP America Summit came to Iowa City in October, bringing with it hundreds of entrepreneurial community builders from around the nation. When talking to people from other communities, I heard comments such as "We have cool things going on, but no one knows about them," or "Our college has a reputation as a party school, so it’s hard to focus attention on the entrepreneurial community." Sound familiar?
I really do believe that we have all the ingredients in place for our entrepreneurial community to succeed, thanks to years of community building efforts and people stepping up to offer their support. My hope is that this year we will see more momentum, more density and more big moments in our startup community.
Here are some of the issues I’ve explored so far that lead me to that conclusion:
Raising money is tough but doable
During the time I’ve been writing about entrepreneurship in Iowa (first in Des Moines, then in the Corridor), raising money has been singled out again and again as one of the biggest challenges entrepreneurs face when starting up here.
Many characterize it as a chicken or egg dilemma: Investors don’t pay attention to the flyovers because there aren’t enough quality start-ups here to capture their interest, but the potentially quality start-ups that are here can’t gain traction without investment.
Along with Troy Miller, a local entrepreneur who is studying venture capital, we looked at the venture capital ecosystem in Eastern Iowa (including all forms of private money exchanged for equity in a company). We found success stories at every stage — companies that had found the funding they needed to grow. We found several angel capital funds here and a few venture capital funds with interest in the area.
We also found a few deficiencies: a lack of a formal seed fund, few options for individual angels to meet each other and find deals and a lack of funding for later-stage investments of more than
In the past six months, we also have seen efforts to fill these gaps. When the Iowa Startup Accelerator launches in Cedar Rapids in August, it will include seed funding for accepted companies. The Plains Angels, a Des Moines-based networking and deal sharing group for accredited angel investors, announced earlier this month that more than $1 million has been invested by its members. It also held an informational meeting in Eastern Iowa in conjunction with the Iowa City Area Development Group.
In addition, Des Moines-based Next Level Ventures launched to invest exclusively in Iowa companies at the $1 million to $4 million level.
Meanwhile, the national perception that money exists only on the coasts might be fading, too. A recent report from the National Venture Capital Association examined the top American cities for venture capital funding. While Silicon Valley cities San Francisco and San Jose topped the list, the top 15 included many unusual suspects, such as Atlanta, Chicago, Philadelphia and Boulder, Colo., which is recognized as a top hub of entrepreneurial activity despite its modest size (with a population of 101,808, it’s a hip college town not much bigger than Iowa City).
For entrepreneurs who need an infusion of cash, private venture capital isn’t the only option. The state’s demonstration fund awarded about $13 million to young companies between 2007 and 2012 in the form of grants, loans or royalty agreements, and numerous other state programs exist.
Locally, the East Central Iowa Council of Governments has a revolving loan fund that has invested more than $3 million.
Thanks to these programs, Iowa City company CardioStrong was able to raise more than $140,000 last year without seeking venture capital.
Never stop learning
A personal interest area for me has been the role of education in an entrepreneurial world. I graduated high school in 2008. A lot has changed since then. Has high school changed with it?
We found students doing amazing things when we looked at the BIG Ideas School. In this new model for school championed by Trace Pickering, associate superintendent of the Cedar Rapids Community School District, and Shawn Cornally, BIG headmaster, students learn by doing self-guided community projects. Students’ natural interests and passions guide them to learn everything from chemistry to communication.
Those philosophies might be coming to more students as Cedar Rapids considers creating magnet schools. (Disclosure: Pickering and Cornally are former employees of The Gazette Company, which retains an interest in the BIG school. BIG, and several other education initiatives, are part of The Gazette Company’s Iowa Transformed.)
Meanwhile, at Metro High School, students quickly turned a simple fundraiser into a booming business within school walls. The students learn about engineering, teamwork and sales by creating their popular Metro chocolate bars.
Of course, education doesn’t end with a diploma. Many entrepreneurs I’ve spoken with credit constant reading and learning for their successes. It seems a new meetup group is forming every week for entrepreneurs to learn from each other, whether the topic is agile management, data science or WordPress.
Meanwhile, the University of Iowa is expanding its entrepreneurial offerings for non-students. In the past few months, the John Pappajohn Entrepreneurial Center has launched pilot programs tackling entrepreneurship for all (Venture School, an intensive course in market validation), the shortage of technically skilled workers (web development boot camps) and Iowa’s brain drain (Iowa Innovation Associates, which pairs undergraduates with growing Iowa companies), as well as numerous other workshops, lectures by distinguished speakers and events. If the pilots prove successful, these programs, or something like them, will expand statewide in the coming months.
Under the leadership of Dan Reed, vice president for research and economic development, the UI also hopes to expand licensing and commercialization of intellectual property and partnerships that reach across the state.
Reed hopes to open four to six business engagement centers across the state, staffed with high-tech talent to help businesses grow and innovate.
There’s room for everyone
Sometimes, the very word "entrepreneurship" comes with a clichéd image of an unemployable twenty-something with a laptop. Or, for the newcomer to open coffee or 1 Million Cups, it can seem daunting — like all the seats on the bus already are taken. During my time here, I’ve seen that these images don’t hold up — everyone can play a role in our innovation community.
Our region’s advanced manufacturers stepped up in a big way during Creative Week, when more than 30 opened their doors to show off what they literally create here.
In these pages, the leadership of Kinze Manufacturing in Williamsburg opened up about how they keep their company innovative and how Kinze grew from a one-man welding shop into one of the largest manufacturers of specialty agricultural equipment.
We’ve seen established companies, including some of the region’s largest employers, take a serious interest in nurturing an innovative company culture. They hope that happy and healthy workplaces will encourage talented people to stay in the Creative Corridor.
Non-profits can play a role, too. Rider’s Club of America, a non-profit that provides free rides for seniors, is executing a nationwide expansion from its downtown Cedar Rapids office after participating in a national civic accelerator.
That said, there are opportunities to open our community even more. Lydia Brown and the staff at Ascent Iowa are working on engaging women in entrepreneurship (Iowa’s rankings are consistently abysmal on these metrics). Many networking events happen at 8 or 9 a.m. and aren’t accessible to those without a flexible work culture. And in some rural communities, Internet access may be an issue. Often, though, all it takes is an invitation.
Keep in touch
I’ll keep digging into these and other issues related to innovation. I hope you’ll keep following as we continue this new approach to journalism.
What did I miss on these themes? And what other themes should we explore? I’m always looking for story ideas, news and notes from diverse sources.
I hope to see you there.