6 Ways to Grow a Startup Community in Your Own Backyard

Great ideas and great companies can and should start anywhere. Here are some ways local leaders can foster thriving startup communities.

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6 Ways to Grow a Startup Community in Your Own Backyard
Image credit: Lilly Dong | Getty Images
Policy Analyst at Engine
5 min read
Opinions expressed by Entrepreneur contributors are their own.

As an organization that supports the growth of entrepreneurship across America, we have heard one question over and over again from policymakers and community leaders: “How can I make [insert city name] the next Silicon Valley?”

Over the past half-century, Silicon Valley has emerged as the archetypal startup ecosystem, producing thousands of successful companies and reaping the benefits of the resulting economic development and job creation. It’s no wonder that government leaders are interested in cultivating that kind of growth and creativity in their own back yard.

While there is a growing understanding that the answer to the above question is: “Silicon Valley can’t be perfectly replicated” (and that’s a good thing!), there is still an important conversation to be had around what local leaders and elected officials can be doing to foster thriving startup communities.

Related: Succeeding Outside of Silicon Valley: How the Rest Will Rise

Over the last two years, we’ve logged more than 5,000 miles and visited 24 cities as partners on Revolution’s Rise of the Rest tour. We’ve learned a lot of valuable lessons along the way, including some of the key ways policymakers can encourage and build entrepreneurial ecosystems. Just last week we wrapped up the fifth tour, where we saw how the cities we visited apply certain lessons to their communitities: 

1. Focus on talent

Access to a diverse pipeline of well-rounded and highly trained individuals is vital to startup success. State and local leaders should strive to train and attract top talent, whether through investments in higher education, K-12 STEM education or workforce development programs.

For instance, Utah’s investments in talent have played a huge role in Salt Lake City’s growth as a startup hub. In 2000, the governor launched an initiative to double the number of engineers graduating from Utah colleges and universities. More recently, the state launched a STEM education initiative. These efforts to build a skilled workforce continue to pay off, serving as a bedrock of SLC’s growing startup scene.

2. Foster connections

Another key element of nurturing an entrepreneurial ecosystem is building networks among entrepreneurs, investors and the organizations that support them. Social capital is often as important as financial capital. Community leaders can play an integral role in convening stakeholders and investing in mentorship and support networks.

When Omaha leaders realized that they had a lot of promising young startups but no formal network for those companies, they formed the Startup Collaborative, an organization that provides programming like Startup Weekend and 1 Million Cups and gives early-stage startups access to a network of over 400 mentors, which companies can leverage to develop new ideas, collaborate and learn about how to best run their businesses.

Related: 3 Ways Startup Communities Can Attract and Keep the Right Talent

3. Create a hospitable regulatory environment

Policymakers should pursue a regulatory strategy that encourages, rather than hampers, innovation. This might mean eliminating complex tax structures, reducing occupational licensing requirements, opening up city data or creating incentive programs that encourage investment in startups.

In recent years, Phoenix has seen an increase in the availability of capital for startups. Much of this boost in investment is attributable to Arizona’s Angel Tax Credit, which has enabled hundreds of millions of dollars to go to Arizona startups. 

4. Invest in the community

Whether through direct investment or public-private partnerships, buy-in from state and local governments signals to entrepreneurs that their city will be supportive as they grow their companies.

In Albuquerque, the city has backed ABQid, a business accelerator that provides resources for entrepreneurs and helps high-growth startups launch. The city’s $1.8 million partnership with the program sends a message that "the City is firmly behind its entrepreneurs.”

5. Improve quality of life

When determining where to start a company, many entrepreneurs take quality of life into account (weather, cost of living, public transportation, and other factors). 

Denver is a great example of a city with a thriving startup ecosystem that is also known for its quality of life. While some of this is unique to Denver (you can’t duplicate 300 days of sunshine), the city has also made deliberate investments in improving quality of life, like building a new, multi-billion dollar rail system called FasTracks, which is continuing to expand.

Related: 4 Ways to Thrive as an Entrepreneur Outside the Valley

6. Be an ally

Finally, policymakers should be allies to the startups in their communities. Engage with and listen to entrepreneurs. Use the bully pulpit to champion and celebrate the innovation ecosystem growing in your region and the individuals driving that growth. And one day, leaders in towns and cities around the country will be asking how their community can learn from your efforts to build their own startup ecosystems.








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