Startups are Essential for Regional Growth
“Economic Engines” to a region are often forces that propel positive growth and opportunity for all its residents. Sometimes these engines can be enormous employers, like Amazon, Boeing, or Microsoft. Sometimes they can be value laboratories like Stanford, MIT, and UW. But one of the most important economic engines to a regional economy is not simply a single large employer, but instead hundreds of smaller engines operating in similar effort, creating net new value. These are the startups, the dreamers, the founders that are willing to build something that hasn’t been built before. Some do this for the potential of compelling economic gain. Others do it to scratch the entrepreneurial itch, or simply to find out if it can be done. For many, it’s a combination of all of the above. Silicon Valley and San Francisco have become legendary at supporting these dreamers (and success often brings its own challenges, like a recent article sharing that an annual salary of $117k is considered “low income” – good grief). But what should be considered is that supporting startups (especially technology startups) is healthy for a regional economy.
Let’s consider some quotes:
A recent study calculates that the number of technology-based startups in the US economy grew 47 percent in the last decade, and these new firms have been “making an outsized contribution to economic growth.”
“Without startups, there would be no net job growth in the U.S.” (Kaufmann Foundation)
“Economic growth can’t be solely attributed to startup development, but facilitating the birth and growth of new startups is a positive move for almost any region. Startups create new jobs, promote new spending, and drive innovation more than their older counterparts, and when lots of startups start popping up, they can even drive more entrepreneurship.” How Technology-Based Start-Ups Support U.S. Economic Growth
“tech-driven ventures ‘offer better-paying, longer-lasting jobs than other startups, they innovate more, and they are more likely to export their goods and services, which makes a disproportionate contribution to growth.’ “(Forbes)
A question unique to our community: Is it possible for a startup economy to exist within the shade of a mature, older and more established economy? Can a startup ecosystem live within and perhaps even be boosted by the stable military and government engine that accounts for so much of Kitsap vitality today?
According to the studies, this is quite possible. The resources that are available to startup entrepreneurs today are vast (cloud-servers, mobile development, virtual collaboration) and important ones are beginning to show up in Kitsap and the greater Olympic Peninsula, like Vibe Coworks. Additionally, we have some shining examples of innovation that have been birthed in our region (among them Avalara, a Kitsap startup recently achieving $180M initial public offering). But often startups are successful in spite of the community they live in – not because of it.
If we reduce the friction and increase the support, we may be able to see a positive explosion of new startups emerge.
Techstars, “a worldwide network that helps entrepreneurs succeed”, produced a report that creates a framework for economic, education, and community leaders to learn from. The report, titled: “Fostering a Startup and Innovation Ecosystem” contains practical and helpful guidelines on how to achieve a robust startup environment. Several of us working on the Startup Kitsap initiative are dissecting the wisdom of this doc and working to apply it to our region.
Are there simple solutions to achieve a robust startup ecosystem? Sadly no. Are there significant rewards for our constituents, our dreamers, our existing military personnel, our veterans, and our students? Absolutely! Already these groups are inspired by the possibilities of tomorrow.
It is now time for us in leadership to create the vision that makes our great community, cities, and neighborhoods thriving places to innovate and launch inspired startups. Let’s endeavor to make a difference and support those dreamers – they have the potential to change the world.
