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Foreign Policy Analysis
A Resource Ecosystem to Support Entrepreneurs

A Resource Ecosystem to Support Entrepreneurs


>>I hang out in, in EDA, the Economic Development
Administration to support the conditions for
entrepreneurs and startups to succeed as a tool for
economic development. In the last decade or so, the US has really embraced
entrepreneurial-based economic development as a tool to create
jobs, economic diversity, and, and new economic activity
in regions all over the US. This is a little bit different than many economic development
professionals might know as some of the more traditional
brick-and-mortar type of strategy. Where you’re recruiting
big firms in to stand up, start large manufacturing
efforts in kind of a more competitive
economic strategy where you’re trying
to do exactly that. You’re trying to
compete for firms across state lines or regions. So the essence today that we
want to focus on is really on how can we organically
build firms locally with, with the entrepreneurs, with
the researchers, the inventors that we have within our
region instead of having to recruit firms outside? So with me today are four people
who are focused on exactly that, who are doing it
day, day in and day out across different
regions all over. And quick, just to
survey the crowd, who here has been
to Oklahoma City? Okay, great. I was hoping for that. Who here has been to
Raleigh, North Carolina? Okay, a few more. This is great, you know. We’ve got four different
ecosystems represented on our panel, and I’ll let
them introduce themselves in a second, but I’m
glad to see that. I see we’re going to make a
lot of money today by educating and informing you about some of
these great entrepreneurial hubs in the US that are
not New York City, that are not San Francisco
or Chicago or Austin. But there’s awesome stuff
happening all over the US. and these four experts will
talk to us today about that. So enough from me. I’m just going to moderate. In short, we’re going
to keep it simple. We’ve got four regions to cover. To start off, I’d just like
you to tell the crowd here who you are, what you
do, and how you do it. Again who you are, what
you do, and how you do it. So I’m Craig Buerstatte, I’m
the director for the Office of Innovation and
Entrepreneurship at the US Department
of Commerce. We invest in entrepreneurial
ecosystems with grants, support them with policies
and other measures, and Erica!>>I’m Erica Lucas. I’m the co-founder
of StitchCrew. We are a social enterprise
that’s growing the innovation economy in our state
and in our region. And we do that through
partnerships, so we recently partnered with
the Oklahoma City Thunder, which is the NBA program which
is, if there are any Canadians in the room, we’re pulling
for the Raptors to win. [Laughter] But we do that,
we run an accelerator program that connects entrepreneurs with capital resources
and social networks.>>Great.>>Hey, y’all, I’m Sarah Glova. I’m from Raleigh, North
Carolina, and there I work with a nonprofit
group called RIoT. And RIoT focuses on economic
development through IoT, or the Internet of Things. So we’re focused on IoT
or the Internet of Things because we feel like this fourth
industrial revolution is here, and there are a lot
of IoT opportunities to help create and
to help capture. And we know that this can help
drive economic development because IoT is creating
crazy new business cases, driving all kinds
of efficiencies. We want large organizations,
we want smart cities, we want research universities
and we want startups to be able to participate in that. We measure our success
through job creation and through investment
in startups. So how do we do that? That sounds great, but how
do we make that happen? Well, we also have a
startup accelerator like Erica just mentioned. Ours, we have a specific
hardware focus. To participate in IoT, you
need some kind of device that collects this data. And so we have a
hardware prototyping lab in Raleigh, North Carolina. And then the sponsors
who sponsor us believe in the IoT industrial
revolution. They want to participate,
they want to know how, and so they partner with us, and
we help them figure that out, leveraging our nonprofit status
to give them neutral advice on where to go next,
who to partner with, what tech to look at, et cetera.>>Hi, everyone. I’m Lindsay Cox. I’m with Launch Tennessee. We’re a 501c3 nonprofit,
public-private partnership with the state of Tennessee. We’re perhaps best known for
the successful implementation of our hub and spoke model. So Launch Tennessee
serves the whole state, but we have six regional
entrepreneurship centers that serve as the front door of entrepreneurship
for their region. We also have numerous
other community partners across the state. We focus primarily on
capital, market access, talent, commercialization, and
creating a friendly environment for our entrepreneurs
to thrive in.>>I’m Josh Mandell. I’m the chief operating
officer for Halcyon, which amongst other things, our flagship program is a
social enterprise incubator which is headquartered
about two miles due west of here in Georgetown. We basically look for both
artists and startup businesses from anywhere in the
world that are trying to solve major 21st
century challenges. We’re completely
sector-agnostic. We’re a nonprofit
model incubator, so we take zero equity
in any of the companies, and we have a residential
incubator program where all of the startups that
are admitted to the program actually
live at the facility. So we have a real living, breathing social enterprise
ecosystem at Halcyon which I’ll get into later. But really our focus is on solving these major
21st-century challenges in education, health,
environment, energy by investing in the startups who we think are
most likely to actually produce, deploy, and at the right price.>>Thanks, Josh. So we’ve got four different
organizations working to support four very
different regions. One right in our backyard,
Josh Mandell at Halcyon. You’re in DC. But in the strategy that they’re
deploying are different and vary in size and scope, but I, I’d
like to focus on, on at the top of that is the ecosystem
or the region as a whole. So less about your specific
programs right now, but can each of you discuss a little
bit about the community that you’re operating in? The types of entrepreneurs
and, and the industry across your region
that makes you unique? And also maybe makes
you struggle sometimes? What are you trying to
support in that region as well? What are the gaps?>>You want me to go first?>>Yeah, please, Erica.>>So Oklahoma, we’ve
always produced high-profile entrepreneurs, particularly in
traditional industries like oil and gas, aerospace, banking. We are now at a time where we’re
focusing on the next generation of entrepreneurs that are more
focused on the digital economy. And but it’s still broad. Our particular accelerator, we
don’t have an industry focus because we, the thing that
we like about innovation and technology is that you
don’t have to box it, right? Some of the sensors
that you’re using and in the healthcare arena
can be transferred to aerospace or the oil and gas
industry, or even agriculture. So, so we don’t have
a sector focus because we don’t
have the density yet. And in terms of struggle,
I mean, I’m sure we’ll get into some of those deals. But I would say I’m excited
right now about the fact that we have a new governor,
a new lieutenant governor, a new executive director of
commerce, which I think is in the back over there, Brent. And a secretary of commerce that
are all former entrepreneurs, so they actually get the need
that you just mentioned before. We need to recruit and
support the large employers that are creating
all of those jobs, but really the way
forward is by investing in local entrepreneurs and,
and growing organically so.>>Great, thanks. So Sarah, I think North Carolina
in the Internet of Things, you’ve got a little bit
more defined cluster there, and you’ve been around for
five, six years now, I think? So tell us a little
bit more about that.>>That’s right, so
RIoT hasn’t been a lot, around for that long. We’re a startup ourselves. We’ve been around
for five years, but most of you have
probably heard of the Research Triangle
Park which has been around for a long time in that
Raleigh-Durham-Chapel Hill area. And has attracted major
companies like IBM. We had a huge mobile
wireless presence in that 2008-2009
timeframe when we started to see the decline before that. We had organizations like
Sony Ericsson and HT– HTC really on the forefront
of wireless technology. Well all of that, years before
RIoT was even conceptualized, helped to build the ecosystem
that we still have today. When that 2008-2009 bubble
burst, there was a nonprofit that bought a lot of the
wireless testing equipment, put it into a blank canvas of
an area, and invited people to come and start companies. So say you and I had an idea
for a new mobile device. A huge barrier to market is
getting that device tested, telling the FCC like, “Hey! I promise it won’t interfere with your pacemaker
or microwave.” The barrier for that can be
paying for a testing company to just tell you, “No,
your device doesn’t work. Go home and try again.” What if you could work right
next to that equipment? So thanks to some
foresight in Raleigh and in Wake Forest,
that center exists. It’s a nonprofit called the
Wireless Research Center. And you can go there, and
you can test your devices and work alongside engineers
who, in this nonprofit space, will help you get
your device certified. It’s really incredible,
and so that wireless, that wireless ecosystem that
really helps build a foundation for the, the tech presence in Raleigh has been
really important. So how we’ve leveraged that
over the last couple of years to grow our ecosystem quickly
is convincing every business that they have a
connection to IoT. I like to use the metaphor
of the Internet revolution. Maybe the tech companies
adopted it first, but eventually everyone, even your uncle’s plumbing
company needed a Facebook page, needed an email address. IoT is going to be the same way. We’re going to have
business use cases that disrupt all industries, not just tech industries
but Main Street too. Just as a small example,
in the last round of our startup accelerator,
we had a smart IoT and block chain-focused
pet cremation company. They were trying to be,
bring more transparency to this system of, you know
something that’s really close to your heart that you want to
have a lot of transparency for, and that people want to see
done in a sustainable way. So every business is going
to be touched by IoT, so we grow our ecosystem by leveraging the diverse
tech expertise that’s already in Raleigh, and helping
all businesses understand that they do have a
connection to IoT. The last thing I’ll mention within this space is really the
diversity and collaboration. A lot of the startups
that we work with aren’t the typical
Mark-Zuckerberg-looking, I mean, people in our office, it’s a lot of t-shirt wearing,
I will give you that. But a lot of these people, they’re starting their
third or fourth businesses. They’re coming out of the C
Suite and starting something, so they don’t look like, you
know what you’d typically see on the cover of Wired,
cover of Wired. And how we’re able to do that
is we’re so collaborative. We’re not the Silicon
Valley of the East. We are Raleigh, North Carolina. One of our taglines
is “Welcome, Y’all.” Someone wants to get a
cup of coffee with you and ask you a couple
questions, you’re not going to make them sign an NDA. You’re going to get a
cup of coffee with them, and it’s probably going to
be some local coffee company that has its own
roaster and, I mean, it’s just a really collaborative
area, a lot of diversity, so if you haven’t
been to Raleigh, I, I highly encourage you. Reach out. I can help set up some
meetings, no NDA required. And we’ll help you see
why we’ve been able to grow this ecosystem
so quickly.>>Thanks, Sarah. So the Research Triangle:
Raleigh-Durham-Chapel Hill. And in the surrounding
rural communities, too. I know you’ve got a great reach. Moving from a maybe
a, I don’t want to call it a smaller community,
but, but clearly a, a, a city or a tri-city
region to a big state. So Tennessee. Lindsay, your team is operating
across a very dispersed state. Tennessee, for those that, that
don’t know what it looks like, it is a very long,
dispersed state. You’ve got some challenges
there.>>Yes.>>So talk to us about
what you’re doing that is state-of-the-ecosystem
there, what you’re most excited about.>>Yeah, absolutely! Yes, we’re very,
very long state. I think we’re about a
seven-and-a-half-hour drive end to end. So not always the easiest to
get an entrepreneur from Memphis to Kingsport, Tennessee. So we really do rely on our regional entrepreneurship
center hub model to connect those. So we’re really creating density in the state via this
connected network. So if you’re an entrepreneur
in Memphis, and you need to utilize the mentoring
resources of a Knoxville or a Nashville or a
Chattanooga, we can help you do that in a very streamlined
fashion. So I think that is a really
unique opportunity that we have. We also have industry strength
throughout all of our regions. So Memphis, for example,
you know, heavy med device, St. Jude research is there. Knoxville, in addition
to being a maker city, Oak Ridge is right outside, so
that is another great resource. We partner with the lab.>>For those that
might not know, could you explain
what Oak Ridge is?>>Sure. So Oak Ridge
is a national lab. It is heavily focused on energy,
so for any, any folks interested in energy in the room,
there’s a really great program that we’ve been partnered with within the national lab
called Innovation Crossroads that is striving to sponsor,
foster the next generation of advanced energy
entrepreneurs. And so that’s been a
great kind of asset and a way we’re connecting. In Nashville, we of course
have the music industry, but we also have health tech
as well as [inaudible] tech. And then Chattanooga’s
perhaps best known for the gig. But where I really
see our opportunity is within our rural communities. So we also have two regional
entrepreneurship centers located in more rural locations. And, and for us, that could be
developing a talent pipeline in those regions, so for
example, with the co, which is located in
Jackson, Tennessee, in between Memphis
and Nashville. They have a really great program
called Driving Innovation where they literally drive a
tricked-out bus across the state of Tennessee to engage
with school systems to start fostering
that entrepreneurship and technology idea even
younger within our communities. So I think that’s great and
a very cool opportunity.>>Absolutely! So Josh Mandell, entrepreneurship
in Washington, DC? Tell me about it. In the, in the world’s hub for
politics, how is it possible to grow successful high tech,
disruptive businesses here? Tell us about Halcyon.>>Well, it’s, it’s tough
to describe it when you lead in like that [laughter]. It’s true, typically for,
for foreign visitors, and even domestic
visitors, Washington, DC is considered
a government town. If you look at the
numbers, it’s the, certainly the largest
employer in the entire region, but I would say that actually
we just conducted a study called The Social Enterprise
Ecosystem Report, which looked at actually 24 cities,
major entrepreneurial hubs, across the United States. For social enterprise,
which I’ll get into a little bit
later, Washington, DC’s actually ranked
third in the United States for a whole variety
of reasons of places to start a social enterprise. And when I say, “social
enterprise,” I’m not talking about nonprofit projects. I’m actually talking about a
majority of for-profit product, service businesses
that just happen to have social impact woven
into their business plan, which I personally think
is the future of startups, but we can kind of get
into that, that later. But I think that
Washington, DC’s ecosystem for startups started exclusively
because of the people. It wasn’t because of massive
government investments. It wasn’t because of
huge policy shifts. It, it happened because
you have a huge number of civically minded individuals
who either worked in government, came out of government who want to do some good to
change the world. They got an education, they came
to Washington to either intern for a member of Congress, or
perhaps work for an agency. You know did their, did their
time in the government as, as I did too in my,
in my previous career. And realized that perhaps
government wasn’t the best conduit to actually having the
kind of impact they wanted. Washington, DC is an
incredibly livable city. Once you leave downtown and go
visit the, the neighborhoods of Washington, you’ll actually
see many different cities, so I encourage everybody
to get out there and actually see the city
of Washington as opposed to, you know just going to the
kind of typical tourist stops. It’s a very young,
highly-educated, very, has a lot, about ten research
universities within ten miles of the city center, so it
has all of those ingredients that make it a great
place to start a business. You have New York
not so far away. You have the Baltimore-Richmond
corridor, and DC is just a
fun place to live. And I always say, I mean Silicon
Valley wouldn’t be Silicon Valley if it didn’t have good
weather, and I think that, not that Washington,
DC has great weather, but it’s an attractive
place to live. I mean, I ended up here
20 years ago by accident, and kind of never left. And it, this, it’s the kind of
city that’s always improving, so I think for a startup
that’s looking for a fun, interesting dynamic
place to live where you can access all kinds of incredible talent,
DC’s one of the best.>>I want to run with
that for a second. Right now, the cost of
starting a business is evermore increasing. The barriers, the
competitiveness, you name it, there are so many
issues out there that are thwarting entrepreneurs
and preventing them from scaling a business. And some of that is, is sanity
in, in, in keeping balance and, and enjoying the ride and
having a good time while you’re doing it. And one thing that I,
I get a lot of pleasure with is seeing all the exciting
communities that I get to visit across the nation that
are building dynamic, thriving entrepreneurial hubs. One way they’re able
to do that is by embracing the
community’s strengths, embracing the qualities,
whether it’s in Salt Lake City, and the skiing and the
outdoor activities. Or what Josh talked about,
the quality of life here in this city, the history,
the museums, you name it. So I, I want to take a
moment to talk about some of those characteristics
in your communities, four very different
regions right now that are attracting
the entrepreneurs. And also give us one teaser. What’s your personal favorite
thing to do on your free time to relax or to enjoy the region? Tell us, this, this is,
after all, we’re trying to recruit some business
here [inaudible] so this is your opportunity. Recruit!>>Yeah, so obviously we love
to go watch a Thunder game, so we love the NBA team. We actually, we’re
outdoors-type of people. And I keep [inaudible] my
cofounder and also husband over there, but we
love the outdoors. So we actually have,
the boathouse district, which is a place that houses
a lot of rowing athletes that are heading over to
Tokyo in 2020 for the Olympics because we are a US
Olympic training site. So that’s pretty cool,
and so you have rafting, you have whitewaters, a lot
of stuff that you can do. We, we also have over 3000
lakes in the state of Oklahoma, and our tribes, we have
39 tribes in our state which offer a very unique
incentive proposition to investors, which I’ll
get into that later. But the, those tribes have built
incredible luxury resorts all over the state, so
there’s really something for just about anyone. We have a lot of young and
diverse group of people as well. The automobile alley, it’s one where you can find
dining experiences, and you can go bar-hopping
to really cool bars all over. That’s what we like to do.>>Great. Thanks, Erica. Sarah? Speaking of,
of rafting and water, I know North Carolina has
the National Whitewater Rafting Center. So what else you got though?>>We have all kinds of stuff. I literally live down the
street from a curling rink, if you want to try
your hand at curling. I mean, we have everything,
and I have to, just a personal story. So my father was a
colonel in the Army, and so I have lived all over
the place, and I spent some time in Raleigh as a kid and just
knew right away that that’s where I was going to stay. And the reason was the people
were friendly, it wasn’t as cold as some of the cold
places that I’d been. But also, there was
so much to do. I can get to the
beach in two hours. I can get to the
mountains in a few more. There’s lake all over the place, and we spend a lot
of time outside. We have beautiful greenways
just throughout the state. But you asked what we
do in our personal time. I would like to tell
you that I go hiking in all of my personal time. What I actually do in most of
my personal time, my family and I, we’re big foodies. We love to eat, and I
know if you go here, anybody from Texas
talks, they will pretend like they have the corner on
barbeque, but North Carolina has like territorial barbeque. Like you would think
when you moved to North Carolina the most
important thing is picking a college basketball team,
which is also true. But before that, you have to
pick east or west barbeque. And like there are family
feuds about this kind of stuff, so the food scene is incredible. We attract so many young
people who are looking for high quality of life. You can get an apartment in
San Francisco or a mansion in Raleigh, your choice. So we attract a lot of people
who want to move there for that, and so to support
that, what do you need? You need good food, and you need
breweries, and we have a lot of both, so if you haven’t had
a visit to Raleigh in a while, definitely come check it out. It’ll probably look different
than if you saw it 15 years ago because it’s grown
really intelligently. Still very low traffic, but
a lot going on there, so.>>Lindsay, this might
be too easy for you.>>Yeah. I’ll, so I, I
live in Nashville, so I’ll, I’ll pick on Nashville
for a minute which all of these cities are great,
but Nashville, I mean. Who? Has everybody? Who has been to Nashville
in the room? Right? It’s awesome, so how
can you, how can you not want to come back and start a
business there or in one of our other communities
just outside? So for, for us, the reason
my husband and I love to live in Nashville, you can get
an hour outside the city and access those great hiking
trails and those great lakes. But the city is really
undergoing kind of a cultural revolution. It’s become very young,
very current, very hip. The food scene, you know,
is rivaling that now of New York and LA and DC. So come for a visit,
check it out. I guarantee you will
not be disappointed. In addition to that,
we also are home to the Nashville Predators,
the Tennessee Titans. We have a new AAA baseball
stadium that was built which is an experience
unto itself. You can also play mini golf
while you’re there and partner with an art community,
so that’s very great. We also got awarded an,
an, a MLS franchise, so that’ll be coming to
town in the next year, so major sporting events. You may have seen us on the
news recently as the host of the largest NFL draft. So 650,000 people in downtown
Nashville over four days. Also the CMA music festival
just wrapped up this past week. But we are more than
just country music, contrary to kind
of media belief. So East Nashville, big
arts and culture hub. We are home to several major
record labels which helps to propel that and keep that
kind of young, fresh talent. We get compared to Austin a lot, but we’re still substantially
cheaper, and we are also, we were also selected as
what, what I’ve been kind of calling internally
HQ3 for Amazon. So we didn’t get
awarded the big contract, but we did get awarded
the center for operational excellent. So we’ll, they’ll be
bringing 5000 people on board. So as you can see,
there’s a lot going on.>>Josh, what’s secrets
about DC. I mean, there’s,
there’s such a national and international pull here,
but tell, tell us about DC.>>And we’re very happy
to have gotten Amazon HQ2. [Laughter]>>I don’t know.>>But that they’re sharing
the wealth [laughter]. So aside from the museums
which I think are the hugs, the largest draw to,
to Washington in, in addition to government and
the great food that DC has from everywhere in the world. Which I think are both
really important criteria, two things I don’t think
people know that much about what makes DC unique. One is we have a, a
major national park that actually runs right
through the center of the city. Once you leave downtown
and you look at the map, you’ll see Rock Creek Park
which bisects the city. You can get out into Rock
Creek like two minutes from where I live, up 16th
Street, and you feel like you’re in the middle of, of a forest. And it’s a great, especially if politics have become a
little overwhelming for you and you feel like you need to
escape, you actually don’t have to go very far to
kind of commune with nature in Washington, DC. So it’s typically
a stereotypical– in fact, it was built on a
swamp, but not all of it. So that, the outdoor
options for Washington, DC are pretty remarkable
and a very small town. DC is a city of about
600,000, so a very, very small, small city for US standards. The other part is the
embassy community. So on any given week, any given
weekend, any time of the year, you can find international
activities that are taking place at a variety of embassies
around town. You feel like you’re
in a foreign country. You get to really kind of experience every
culture you can imagine. And so I think that, that
for me is a great way to feel like a global citizen in
a city like Washington. Of course these are, these
are three other cities which are exceptionally diverse,
but I feel Washington, DC, as far as its having an
international presence of people from every walk of life is a
real attractor for the region.>>Thanks, Josh. So I want to get back to
business a little bit, and let’s start talking
a little, dive deeper into the
entrepreneurship aspects of our work and what we’re
all trying to do here. And let’s start with
Lindsay, actually. I, I thought it was interesting
that you talk about the, the breadth of your work
across the entire state. And you named a number of
very different organizations. A national lab, universities,
you are a nonprofit yourself. It is, sounds a little bit
like wrestling a giant. Talk, talk to us about how you
are successfully doing that. What enables you to work in that
environment when it’s culturally or the resources you have? Can you expound on
that a little bit?>>Sure, I mean culturally
I think the, the South, it really is true. Everybody is kind of
rising tides lift all boats, and trying to be there
and help each other out. For us, what we kind
of look for that is key to us is a really willing and
able partner in the region. So it could be that there’s
thins great organization and they’ve got stuff going on. But if they don’t have a
true champion that is willing to you know push comes to
shove, do what they have to do to get things done,
they’re not going to be the perfect
partner for us. And so we have found that in
all those different aspects. So within Oak Ridge National
Lab, finding a champion within the lab who
really felt strongly about fostering young startups, finding that within
our universities. Like it’s not the whole entity. It truly can come down to
those one or two people that really drive
it from within. And so we’ve found that, we
have identified that in all of these different
partners across the region. And it really is that
kind of unifying factor that helps us get out work
done day in and day out.>>That’s fascinating then that
that one champion can rally for the cause and deliver. So you talked about
five years young and you all had an interesting
start with realizing the asset of the Internet of
Things there locally. Tell us what the secret– you,
you, you touched on it a bit. But the secret sauce,
if you will, to, to move from concept five years
ago to where you’re at today. Which is really a, a, a new
industry focus for the Triangle. It is not what the
Triangle is known for.>>That’s right.>>What enabled you to do that?>>That’s a great question, and I hope that every
moderator phrases it that way. What’s the secret sauce
that makes you successfully? Please always ask me that,
I love that phrasing. [Laughter] If I had to break
down what’s made RIoT successful so far, there’s a
couple ingredients to what Craig called
the secret sauce. One I already talked about,
our, our history with RTP. But I mentioned, you know,
that, that’s going back to the seventies, so it’s not
that it was always IoT focus. That there’s some tech people in
the room maybe you would argue with me and say yes, it was. We just called it
machine to machine. And yes, the IoT is
a term that’s talking about you know a
long history of tech. But leveraging what’s there in
RTP, that’s been huge for us. The diversity, the
diversity of industries. It’s incredible what
you can find in Raleigh, and we need that, so IoT,
we talk about it sometimes like it’s an umbrella. You need so many different
things to make IoT happen. It can’t happen in one vertical. You need to have some kind of
hardware that’s collecting data. You need to be able
to communicate, you need to have that network. You need to be able to analyze
that data, and if you want to drive insights from it,
you need to be able to analyze and learn from it, so that
means a lot of computing power. We’re talking about an umbrella,
this isn’t one vertical, and so what’s going to be
key to that is partnerships. And so whether you’re a big
organization that’s been around for 100 years, or a
startup that’s, you know, one year out the gate and trying
to go to market with your MVP, then you need partnerships. And so as a nonprofit what we’ve
offered is this neutral voice. So an organization might
come and sponsor us because they are trying to be
a smart city, and they want to know which pilot projects
they should start with. That way they’re
able to reinvest and keep that program going. Or it might be a multinational
corporation that’s saying, “We have so many different
ways that we could go in this new IoT space. Where should we go first? How do we start this
conversation?” And then if you’re a startup,
there are a lot of accelerators out there, I mean a lot. This space is growing. I think we can all
agree on that. What makes us unique as a nonprofit also
not taking any equity, not charging the startups. We’re not run by a corporation,
so if you come to us and you’re considering,
you know, what kind of Cloud technology? Azure? AWS? We’re not funded by an
organization that’s going to give you one answer. We’re going to be able to talk
with you about all your options. And so I think that neutrality
has been really key for us. Being able to provide
that, that feedback because there are
so many options now. So I hope after hearing
a little bit about RIoT, if you meet an organization that
is wondering how they’re going to go forward in this IoT space,
and that needs a neutral voice, partnering with a nonprofit
like RIoT is a great solution. You can connect with our over
80 partners that we have now that directly fund us. You can maybe have a tech or a
talent or even customer pipeline by working with the
startups that we work with, and then you can help
leverage the partnerships and grow our ecosystem
to the southern phrase that Lindsay alluded to earlier, that rising tide
raises all boats.>>So this is my opportunity
as a shameless federal plug, speaking of partnerships,
I also want to highlight that the federal
government, our office and many others is
directly partnering with, with organizations just
like these to enable them to create those partnerships. So we have a number of grant
programs, partnership programs, or just kind of amplification
efforts that we do at the federal level to try
to unlock local capacity. So in Sarah’s case it
was a direct investment that gave them capital,
the operating capital to pull those 80
partners together. The staff, the marketing,
and those efforts. That’s one way I think the
US federal government is, is working hard to
support this type of work.>>It especially helped us
get our three-D printer, too, so thank you.>>Or with equipment
and resources. Similar in, in concept perhaps,
Josh, where you’ve got a market, and we’ve talked about this
already, DC being known for government and federal work
and contracting and what not. So Sarah highlighted the, the
Triangle and its long history with research and
health and science and, and moving it into
an IoT cluster. So can you, can you
tap into some of that. You were talking, too, earlier
about the, the talent that is, that is driven into
that social sector and what you guys
are doing about it, and how you’ve built
the momentum?>>Yeah, so specifically
as a nonprofit incubator where we’re not taking any
equity in the companies, so how does our incubator
actually function? It’s actually a, a relatively
expensive enterprise to, I mean we get about 1000
applications from 70 countries for Halcyon, Halcyon
Fellowships, and we accept 16
companies a year. So we’re accepting
between one and two percent of the venture applicants
that come to Halcyon. The selection process of Halcyon
is probably the most important thing we do, but the reason
that startups want to come and incubate at Halcyon, it’s
of course we’re relieving all of the financial pressure
from the companies for the entire duration
that they’re there. For five months, we give
them room and board. They live in a 19th
century, 18th century mansion in Georgetown which is
actually kind of nice. We actually give them
a living stipend. They’re, these are early stage
companies that are at the period of development where
they’re most likely to fail. That’s when we want them. That’s when we want to give
them the tools they need, so as a nonprofit incubator,
Washington, DC is good for us because basically all
large US and a lot of international companies have
a presence in Washington, DC. There is a growing
community of impact and traditional investors
in Washington. Most of our companies
have a policy component to what they’re doing, so whether it’s disrupting the
healthcare industry or education or energy, we can
always find somebody who can help them navigate
the policy dimensions of what they’re trying to do. We have partnerships with several large
companies including Amazon and Deloitte Consulting
and Capital One, and several law firms all of
those companies provide all of their business services to
our startups completely for free in addition to a very large
pool of mentors and experts in every sector,
leadership coaching. We have a completely
immersive community that is exclusively based on
people wanting to give back to the next generation
of entrepreneurs. And it’s a very philanthropic
community both here in Washington, DC and
the United States. It’s really hard to
emulate that in other parts of the world, but we’re trying. But basically this, but
the most important part of our ecosystem is that
we’ve created the conditions for startups to actually
collaborate with each other. So you have health tech
companies collaborating with education companies
collaborating with energy companies,
and they’re all working and living together, trying to solve the same
kinds of problems. And if you really want
to talk fun ecosystems, we do the same thing
for our arts lab. So we have sculptors and
painters and filmmakers and poets and choreographers
who we’re teaching to have more of a social impact
through their art. Imagine programming where
you have the entrepreneurs and the artists both
learning how to market and brand themselves. I think that, and how
to manage their books and how to build a team. When you merge artists and
entrepreneurs together, you actually get some
really interesting results. And that’s kind of one of
the cool, that’s the kind of the special sauce of
Halcyon that we get to see and experience every day.>>Speaking of branding,
it is often hard to talk about another region
or another program. I mean, I know y’all are,
are the, the most loudest, strongest advocates for your
programs and your regions, but we want to maximize
everyone’s time here. And Erica, you know
entrepreneurship is a contact sport. It takes teamwork
to get things done. And I think the same goes for
the work that you’re doing to support the entrepreneurs,
the business leaders, the investors, and
so on and so forth. Who, what regions or what
program gets you the most excited, that you might call
your best friend that’s outside of Oklahoma or at least
outside of Oklahoma City that you think is
a good benchmark that you are equally
excited about. Maybe you share lessons with. Does, does anyone in
particular come to mind when I talk, talk about this?>>Yeah, there’s actually a
lot of, we partner with a lot of other programs
throughout the I35 corridor. So we’re in Oklahoma
right above Texas, right below Kansas, and so– .>>Give me one. Who’s your favorite?>>So the [inaudible]
Foundation has, they have an entrepreneurial,
what it’s called? Gosh, it’s going to escape
my mind, but they, they, like it’s a very similar program
than ours, nonprofit based, they don’t take equity into
the companies that they host. But then they are also
partnering with like Nebraska, obviously us in Oklahoma,
and there’s another program in Houston and another
one in San Antonio. And we’re all trying to
provide exchange programs for the entrepreneurs because of
the peer to peer collaboration that needs to happen
in the industries that we’re all collaborating in. I will think of their
name here soon.>>It, it’s probably
helpful, too, because I know that you guys work to establish that critical mass
of business activity. And you said you, you were
kind of industry-agnostic. You have a lot of different
entrepreneurs as you, as you start to build
the momentum in the city. So that type of cross
pollination. Yeah, entrepreneurial
pipeline, yeah okay.>>So they’re a partner of ours,
but we’re actually part, I mean, obviously my peers here. I learned something from
just even this conversation. We’re actually part of GAN which is an Global
Accelerator Network, and it’s a community comprised of like 105 accelerators
throughout the world. We share emails, mentors
list, investor list, and then we even
vent to each other about you know how do we
solve challenges together?>>Sarah, what about you? Internet of Things,
the Triangle? Who, who’s you, who’s your
long-lost family member.>>I don’t know, I’d have to
do an Ancestry.com for that, but I do know, so the
example that I want to share with this one is a
little bit strange. Okay, so again, Raleigh,
North Carolina, IoT-focused. We’re about leveraging
the IoT assets that are in the southeastern
United States, but we want IoT economic
development, and that means outside of the
southeastern United States. So one of our great partners is
actually in Argentina, Cabase, if you’ve heard of them. And they’ve been
a great partner. We’ve gone down and
spoken a bunch of times. We love speaking at events
like this and participating in the southeastern
United States. We also love going abroad. We speak a lot in Europe and
we have a big presence in Asia. So we are trying to make sure that we truly create a
partnership community that is willing to
collaborate because for us, if we’re measuring jobs created
and investment in startups and those are our
metrics for success, then we can’t be
geographically bound. We have to recognize that
these partnerships need to cross state lines,
country lines, oceans, and so we’re working
very hard on that. So I picked Cabase as
kind of a unique example. But earlier, you talked
about rural communities and I know that’s something
that Tennessee works with. I know that as we
talked about big cities versus the rural communities,
so just a small tidbit for you. If you haven’t heard of Wilson, North Carolina, look
up their story. A number of years ago,
they decided to invest in their own community by building their
own fiber network, having a community-backed
fiber network. And I won’t go into
the whole story because I don’t want
to spoil it. It’s like a Disney movie, but
if you fast-forward to now, they have a startup
acceleration program that has basically helped to
reverse their population decline because they can offer gig
speeds for startups that want to go and, and develop
and leverage that. And so they’re drawing
people to Wilson, North Carolina, very small town. So look up that story,
the Green Light Community Broadband Project. I think you’ll be
very impressed.>>I think that dovetails
nicely with what we talked about earlier where so many
of these communities, I think, are just underrepresented
in the national conversation because everyone
immediately wants to talk about San Francisco or New York, or one of these typical
US markets. But each of you represent
an awesome growing, thriving community, and
it’s such an arbitrage play for investors and
entrepreneurs where your dollar, your work can go so much farther where these markets
are more affordable, better quality of
life, and so on. So I wanted to highlight that. I love that story. Lindsay, statewide, you’ve got
an interesting perspective here. What you got? Who’s your favorite partner?>>So within our kind of side
verticals that we play within, Kentucky is actually who we look to in the commercialization
space specifically. So they had, had and have
a very successful SBIR, small business innovation
research, which is a federal
grant program. They have a very
successful matching program that we were able to emulate so we started our
program two years ago and actually doubled the funding
for ours last year based off of Kentucky’s success. So It’ been very helpful for
me in government relations, as I talk to our
state legislator, legislators to have
a successful program like Kentucky’s to look towards. But then partner that with
all the great things we have in Tennessee, and
we’re unstoppable.>>Josh?>>If it wasn’t for
partnerships, our operation wouldn’t exist, so
there’s so many to choose from. But I’ll, first of all,
quick plug for EDA. I think that it’s, it’s one of
those sub-agency organizations that a lot of folks don’t have
a lot of familiarity with, but if you look at the National
Entrepreneur Center, you know, Michael Bertram who
was part of our, our national advisory council on
innovation entrepreneurship back in the day, they got their
seed funding from EDA. So the federal government
actually has these catalytic investments that it will make in starting an entrepreneurial
ecosystem when it’s really
high-risk investment. And then they become
self-sustainable. So I think they’re kind of like
the, the guy behind the guy that actually gets a lot
of these ecosystems– .>>Don’t tell too many
people [inaudible].>>No, I know. I mean the worst thing that can
happen is you’ll actually get more applicants and
it’ll be great. But I like, over 54% of our
startups are founded by women. Over 64% are minority founders. There’s a ton of data out
there showing that companies that have women or minorities in the leadership actually do
better, and so I’m interested in new kind of financing
models that support, that kind of level the playing
field for women-led companies. There’s still a massive,
a disparity between male and female-led companies
as far as access to capital in the United States
is concerned. If you look, so the one
partner that I really like and I’m looking very
closely at is Ellevest. Sally Krawcheck who’s a very
successful entrepreneur has come up with entirely new
funding mechanisms for women-led startups. I think that those kinds
of partners that are going to get more capital
into the hands of potentially very successful
founders, those are the kinds of partners that I’m always
on, on the lookout for. And we just actually
find that our, our it’s, diversity of our applicant
pool is actually what leads to the success of Halcyon. Our companies, we only have
80 companies in our portfolio. They’ve raised just
under 100 million dollars in outside financing now, and these are all very
early stage companies. A lot of that has to do
with minority and women, women leadership
in each of these, in each of these companies.>>Thanks, Josh. This is Select USA. This is all about making the
pitch, making connections, and I’ve asked our participants
to close with a pitch. And before we go, go, go
through the close here. I’d like to stir
some questions up. So if you’ve got questions,
we’ll switch, we’ll transition to some questions
here in a second. We’ll save some time
at the end, but again, each of you are coming from
very different regions, different programs, with different interests,
different industries. I would love to hear your
pitch, your closing pitch for this crowd here,
a very international, very diverse economic
development organizations, entrepreneurs, investors
themselves. How would you sell your
community and your work today?>>So I’m not here to sell
you on it because I think that if you really
have a company that, I know that’s probably
not what you want to hear, but I think if you’re a startup
that is building a solution for an enterprise or for
aerospace, agriculture, fin tech, you need
to be in Oklahoma. We’re actually a
big corporate state, and those are the
industries that make up most of our economy. If you are an investor, we had
117 opportunity [inaudible] and 39 tribes, Native tribes which offer very unique
incentives to investors looking to come in either as a
greenfield project or to invest in existing companies,
and I’m happy to talk to you one on one about that. Last but not least, as you
mentioned, there, you know, if you’re international– . I used to do foreign direct
investment for the state of Oklahoma, so that was my job to convince you to
come to Oklahoma. I’m now a recovering
economic developer. But, but I would say what makes
us different is there are other high-profile states or
communities, but we’re just over 100 years old, so we’re
actually a very new state. So the opportunity for
growth is exponential. The other thing I would say is
that you actually would come in and help us build community in
a city that you want to live in from the ground up. Because we are so young, and
you get to build it with us. So that’s my pitch.>>Wonderful. There is no perfect pitch. Each of these are unique. Sarah, let’s hear it.>>I’ll start with IoT again. IoT is the fourth
industrial revolution. It is here. It’s not coming, it is here. Data is the new oil, and if
your organizations are going to survive, they need to be
thinking about how they’re going to leverage new IoT
business models. And that’s from tech
organizations to Main Street. You’re going to need
partnerships to make that happen and navigate these crazy
waters that we’re getting into. Some of them 5G-flavored,
and we would love to help you with that. As a nonprofit organization,
we can provide neutral advice that helps you figure out
how to grow and scale. And we do have assets in the
southeastern United States that we can help you leverage, but our reach is
far beyond that. So if you have questions
about IoT, what your organization
is doing in it, or if you’re an IoT
thought leader, and you want to make sure that your
voice is amplified, if you want to use our startups
as part of your tech or talent or customer pipeline, then
you need to connect with me. So please connect with me,
and I’m happy to talk IoT and we can debate
5G if you want.>>So we, we truly do have
something for any kind of entrepreneur of a scalable
mindset within any region of our state, depending
on your industry focus. But moving into the state of Tennessee unlocks all the
resources of Launch Tennessee which I think is a great
incentive to do so, so that could be capital,
SBIR matching fund. We also have an impact fund that helps seed early-stage
companies. Market access, so we connect
our entrepreneurs directly with corporates looking to
invest within those startups, whether that be traditional kind
of venture capital investment or corporate venture investment,
or becoming a customer which is you know
something we really pull for. Commercialization focus,
so the national labs and, and the institutions
are kind of all there and available to help you. And then the environment itself. So we’re 48th in
overall taxation, very business-friendly climate
in the state of Tennessee, but then you also have a
group like Launch Tennessee that is really advocating for
startup-friendly policy as well. So I think that’s
a big advantage.>>Last but not least, Josh And
again, get your questions ready. We’re going to roll
into them just next.>>I think if less about
Washington and more about the United States,
figuring if you want to do business here, you
want to access the market, you want to find
partners, figuring out a way to orient yourself as doing well
and doing good at the same time. Investors are starting
to look much more closely at the positive social
impact from businesses. Making sure that you’re taking
the most vulnerable people, both the customers and
perhaps, you know people who are involved ancillarily
with, with the business. The, the issue is that
it’s not just corporate social responsibility. It’s not just giving some of
your profits to a charity. It’s about actually the
social, positive social impact at the core of your business
models are going to resonate with the US consumer
and with US investors. And I think that there’s a
growing trend from investors who are exclusively looking
for returns on investment on financial gains from
investing in your company and trying to bring your
company into their portfolio. They are looking for companies
who are really thinking about doing good, so I think
that that is an orientation which is going to help every
company in every industry. I also, just as, as a
quick plug, Halcyon knows that it’s a small
operation here in Washington, DC but we’ve already
begun to work with ecosystems around
the country. We’ve licensed our
methodology to universities and to other kind of epicenters of entrepreneurship
in other countries. We are looking at expanding
our physical footprint in other regions, and I
think one of the things that makes our ecosystem
successful is that we’re not just looking at
bringing local entrepreneurs in. It’s about attracting
entrepreneurs from throughout the United
States and around the world and being able to bring the
best talent from everywhere in the world to your country. To you, I know we’re here to
talk about the United States, but I think that building a
pool of talent that focuses around a social enterprise
ecosystem in your country, in your region, is
equally important.>>Thanks, Josh. Enough about us though. What’s on your mind? Questions for the, the panel? Yeah, please. There’s a mic right behind you.>>Hello, thank you
for this discussion. I was wondering which sectors
Halcyon is focusing on.>>The, the short
answer is we don’t care. Being sector-agnostic is a
deliberate move on our part. We feel that companies from
different sectors collaborating with each other actually
has a lot of benefit. If I were to say, you know which
sectors are the most prolific as far as where are we getting
the most applications from, a ton in health, new medical
devices that are cheaper, smarter, faster, focusing on the most vulnerable
populations in the world. A lot on education, ed tech. And a lot in the food industry, so what does the future
of food look like? How do we combat food waste? How do we actually keep
the world fed when the face of the planet is
changing so much? Those are the, those
are the kind of growth sectors
that we’re seeing. But we get, we get
applications from every sector. Yeah, we’re, we’re,
we’re more interested in who has the transformative
idea than what particular
sector they’re coming from.>>Great! Anything else? Yeah, please.>>My name is Mark Preg. I’m the interim director of the
Houston MBDA Business Center, so we’re devoted to
minority-owned businesses. But one, one thing I’m
noticing are you at all dealing with your existing
entrepreneurs and inducing them in some form or manner to hire? Because what we’re noticing
is the more successful clients of mine hire people to
do the things that A, they’re not very good
at or don’t like to do. So adequate back office is
so vital, and I’m wondering if you have any programs
around that?>>I can speak to our
SBIR matching program. So one of the, the things that
our funding can be utilized to do is to hire FTEs, full-time
employees for companies outside of the research purview. So we really want those
funds to be complementary to the federal funding
they receive for research, and so we do make suggestions
around perhaps hiring marketing, back-end office support where they can expand
in those purviews. We also run a very
successful and, and fairly large-scale intern
program which we’re scaling up which places interns
from outside the state and inside the state with
startup companies to kind of expose them earlier on
at a very low-cost barrier to what additional support in
the right places can look like.>>Yeah, an entire subset of
our Halcyon curricula is focused on how to hire and who to hire. And all of our companies
are looking for, I mean most of them are
scientists or engineers or researchers who
have the tech down pat. But they have never
pitched an investor. They have never done
a cap table. They’ve never done a valuation. They’ve never balanced
a book in their life, and, and that’s great! That’s your typical
entrepreneur. So teaching them exactly
who they need rather than who they think they
need is a critical part of the scaling of a company. And so we actually not
just teach them kind of how to do that, but we also
do a lot of match-making from local universities. So we have a talent pool of
people who are actually at, further along in their
career than you would think that are considering working
for startups rather than moving on in the company
that they’re with. Turns out working for startups
is a lot of fun [laughter].>>The dress code’s
much better too.>>And the dress code rules.>>Josh mentioned earlier
that they leverage partners for their curriculum for
their mentoring and similarly so in our accelerator we
also go over those things. And we make sure to leverage
partners and mentors to come in and talk about those subjects. But something unique that really
anyone, if you’re involved in programs like
this could replicate. We have interesting, every other
month we hold what we call a founders roundtable, and we
get our larger corporations to bring someone
from really high up, like as high as we can get. This is the ultimate
skip-level meeting, if you will. And we get them to write labs to
the hardware prototyping space, and we bring our founders in, and we have this two-hour
roundtable discussion where they’re able to talk
to these executives with tons of experience about what
they’re going through. And it’s a little bit like how
my five year old will listen to the soccer coach but not me. Sometimes they need this
other voice to come in, and even if it’s
something that we’ve gone over in the accelerator, when
this executive from IBM comes in and talks about it, they’re like repeating our
curriculum back to us. Like did you hear
what he said about? Well, yes. We taught you that, but we’re so
glad that you’re hearing it now. So bringing those other
voices in, that also helps to surround our entrepreneurial
ecosystem with support from the major corporations
who are now vested in these startup founders
that they met and want to support and want to see grow. So that’s another program really
with any kind of challenges that you’re working
with with startups that would be interesting. And we’d love to connect
more with Houston and work with your startups too, so.>>Good. We got time
for one more question. What’s in the field? Sure!>>Thank you very much. Obviously choosing the right
ecosystem is very important, and I understand that several
cities, states, venture capitals and everybody can formulate
separate ecosystems. How, I mean if, if you could
advise a European-based company to start from a specific step in
order to select the ecosystem, or to, to choose the right
ecosystem, how would, would you have, would you
advise that company to, you know to start
from A and go to B.>>So I, I can do that. I used to be the global
director for FDI for the state of Oklahoma, and then I did
it for Mexico before that. For, for actual companies, and
I would say you need to start from what makes sense for you. So it’s great to learn about
all the different states and what the US has to offer, but I think ultimately
what makes sense for your business
comes first, right? So what industry are you in? What clusters? You know where are the
vendors, where are the customers that are going to be
leveraging your product? I don’t know your business real
well, but just understanding that and what you will need once
you’re in-country to be able to complement your business,
I think that’s number one. Number two from, for the
companies that I work with it was always workforce. So make sure, making sure
that you have the talent that you’re going to need. Obviously we talked
a lot about quality of life, and that’s great. We talked a lot about
our programs, but you know there’s different,
we all thrive in different type of workforce development
trainings. So understanding what
you need specific to, to your business model,
I think it’s important, and I think really the funding and complement incentives
are good. Cost of living is always good. I think we’re going
to be more competitive than anybody on the coast. So but I think everybody’s going
to give you a different pitch. I think ultimately, it comes
to your type of business model.>>One way to quickly sift
through all that, the workforce, the industry concentration and identify clusters is
the US cluster mapping tool. So the Economic Development
Administration manages a cluster mapping tool which you can
drill down to the level of our counties to
understand the concentration of industry activity so
what, what industries are, are leading in that area which also complements
the workforce base. So what type of talent is there? Is it software? Is it manufacturing? Is it clean tech? So it’s, it’s OpenSource,
anyone can use it, so check out US cluster mapping
and you can, like I said, you can, you can search
through the states for all sorts of different criteria to at
least start to develop a, a maybe a short list of
communities that might be within the criteria or framework
of the community that you need. Josh, did you have something?>>Yeah, just two quick things. Look at sister cities, so
there’s a lot of cities in the United States that
have a sister city in Europe. There’s already existing
commercial ties, cultural ties. That’s something that you can
certainly look at and build on. And the other is
diaspora communities. So are there concentrations
of diaspora communities from your country in
a particular city? Those are people who are already
going to be advocates for kind of what’s happening
in your country, so I think that looking
at those two things. So you’re not just starting from
scratch in a particular country. Those are two kind of
hints to, to maybe help in your decision making. It’s all about people.>>Speaking of all about people,
that’s a great way to wrap up. I think some of the panel
have some time to hang out if you have some
questions after this. Please engage, but otherwise,
thanks for your time, folks. And thanks for attending. Have a great day! [ Applause ]

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