All of a sudden, St. Louis is a more nurturing place for entrepreneurs
STLtoday.com
January 27, 2012
By David Nicklaus
St. Louis may finally be ready to shake its reputation as a tough place to start a business.
Working mostly independently of one another, groups of St. Louisans have organized at least a half-dozen efforts to provide capital and advice to startup businesses, all of which seem to be bearing fruit at the same time.
Starting tonight, as many as 100 would-be entrepreneurs will gather downtown for a three-day boot camp called Startup Weekend. This week also saw the launch of a startup competition called Arch Grants and a celebration for eight life-sciences companies benefiting from a pair of federal grants.
Next week, other entrepreneurs plan to launch a Missouri chapter of Startup America, a networking and training partnership. And Capital Innovators, a venture capital fund that brings its portfolio companies together in a common space downtown, is scheduled to announce its next five investments.
Later in February, St. Louis will join a worldwide network called the Founder Institute, and the local FinServe Tech Angels investor group will listen to pitches from entrepreneurs who need money.
In short, an area that's often criticized for its lack of an entrepreneurial culture suddenly has a calendar filled with start dates for groups assisting startups.
This flurry of activity hasn't been coordinated by any one organization. "What you're seeing is a lot of people got frustrated about the same things at the same time," says Jerome Katz, a professor of entrepreneurship at St. Louis University.
Their common thought was that, after a severe recession, the best way to rebuild the local economy was to support energetic new businesses with good ideas.
Many of those ideas are in the technology sector, where the evolution of computing has made it possible to start, say, a social-media or mobile app company just about anywhere.
"It's part serendipity and part market-driven," says Jay DeLong, a vice president of the St. Louis Regional Chamber and Growth Association and a coordinator of Startup Weekend. "There is a groundswell of budding entrepreneurs, and there's a large market opportunity that they're seeking."
Kyle Welborn, an organizer of both FinServe Tech Angels and the local Founder Institute, used to work in Chicago and saw how the success of Groupon made that city a top-of-mind destination for entrepreneurs.
"What I'm seeing here is an explosion of activity, similar to Chicago a couple of years ago," Welborn said. "St. Louis is following some of the things Chicago did to beef up their technology sector."
In fact, several of the startup-boosting efforts here are copycats. Capital Innovators is modeled on "accelerator" funds in Chicago and Boulder, Colo.; Founders Institute has launched more than 400 companies in 21 cities, from Seattle to Sydney.
Similarly, Startup Weekends have occurred in 80 cities, and St. Louis is holding one simultaneously with San Jose, Calif.; Storrs, Conn.; and cities in Belarus, France, Mexico and Norway.
The weekend brings together some people with ideas and others who think their skills could be useful to a startup. Ideas are pitched, teams are formed, and experienced mentors help refine the ideas. The hope is that by Sunday night, some of the teams will be ready to form real businesses.
If they do, they'll be launching in a community that seems much more hospitable to startups than it was even a few weeks ago. But the flurry of activity raises a couple of questions: With so many groups working toward the same goal, how do they avoid duplicating efforts? And how do would-be entrepreneurs know where to turn for help?
As it turns out, people are already trying to answer those questions. Rick Holton, who runs a private-equity fund in Clayton, convened a meeting Thursday of people involved with the various initiatives. He emphasized that he wasn't trying to form an umbrella group, but said he would like to create a website with information about all the St. Louis efforts.
While the burst of activity is heartening, we all need to guard against the temptation to declare victory too soon. Larger-scale funding sources will be needed if we want to build our startups into job-creating businesses, and St. Louis doesn't have a Groupon-like success to boast about.
Jim Brasunas, director of the Information Technology Entrepreneur Network, has been working for years to encourage startups here. He says the region hasn't turned the corner yet, but he is optimistic: "We've entered another phase, and maybe we're in the process of having a corner-type experience. The corner is at least coming into view."
