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A Powerful City Finds Its Entrepreneurial Groove With a crop of startups and hot new accelerators, Washington, D.C., finally has "density" when it comes to entrepreneurs.

By Sarah Max

Opinions expressed by Entrepreneur contributors are their own.

Casey Trees

Editor's note: Over the next few months, we'll be taking a virtual tour of U.S. cities to see how the 2008 financial crisis has changed the entrepreneurial landscape, for better or worse. Read about New York and Houston.

Walking around outside his office near Dupont Circle in Washington, D.C., Peter Corbett sees signs of entrepreneurial activity everywhere. "Chances are I'll run into someone who's working on a startup, and if I go to Café Dupont in The Dupont Circle Hotel, I'll probably see at least one venture capitalist having breakfast with an entrepreneur," says Corbett, who is founder of digital and creative agency iStrategyLabs and, among other hats, runs D.C. Tech Meetup and Digital Capital Week. "There are at least three accelerators within walking distance."

There was a time, not so long ago, when Corbett had a pretty good handle on every meetup, pitch night or startup-related social event. Now that's a pretty tall order. "On any given night, there are five or six things to go to," he says. "Things are just way too big and vibrant, and that's great."

The nation's capital and cities comprising the D.C. metro area have long been entrepreneurial, with a history of startups that have become household names, including AOL and, more recently, LivingSocial. Trouble was, until recently the region lacked what experts call "density," that phenomenon of walking around and bumping into other founder types. "There have always been creative and innovative people here," says Corbett, "but you really had to look for them."

The D.C. entrepreneurial community had started to gain traction in the mid 2000s, but when the financial crisis hit, many would-be entrepreneurs put their heads down and kept plugging away at their contract, corporate or government jobs. The city wasn't as affected by the downturn as other areas, but it was hardly immune to the recession.

Things started to perk up again a couple of years ago, says Jonathon Perrelli, a longtime entrepreneur who is managing director of Fortify Ventures, a Washington, D.C.-based venture capital firm that runs The Fort accelerator. "There's been a big shift from ties to t-shirts," he says, explaining that many of today's founders were latent entrepreneurs working within the confines of government contracts. While it can be tough to leave their cushy government posts for the world of startups, many are doing so, either because they're disenchanted with bureaucracy, need a change from cubicle life or, having built a decent nest egg, can finally afford to make that leap.

Related: Big Ideas in the Big Apple

Indeed, that jump isn't as scary as it used to be, thanks to a wave of new accelerators, incubators and other resources that "help push people over the fence," says Corbett. Last year marked the arrival of The Fort plus two other accelerators: Accelerprise, which is focused on the enterprise space, and Endeavor D.C., which specializes in consumer internet. The newest addition is 1776, which among other things will host a coworking space, an accelerator and classrooms. It's modeled, in part, after such organizations as 1871 in Chicago and General Assembly in New York, says co-founder Donna Harris, but will focus on helping startups and government work together to solve big problems related to education, healthcare and finance.

Yet another resource for local entrepreneurs is Foster.ly, a platform for helping entrepreneurs connect with experts and professionals who can help them build their businesses. The group's "Study Hall" events make it easy for founders to bounce questions off their peers or experts and provide advice on everything from finding office space to courting investors. The group's latest project is a new startup-intern matching site. "Before we even launched, we had people emailing us," says Foster.ly founder Adam Zuckerman.

Many D.C. startups and related organizations got their start in Virginia and Maryland and have only recently moved into the city. Fortify Venture, for example, recently received a grant from D.C. to "immigrate" its headquarters there from Arlington. Far from threatened by the recent burst of startup activity in D.C., folks in the "burbs" say it's helped bring national attention to everything.

"What's good for D.C. is good for us, and what's good for us is good for D.C.," says Jennifer Ives, director of the business investment group at Arlington Economic Development, which has been shepherding budding companies for more than a decade.

Related: Startups Bubbling Up in Houston

Indeed, this isn't the first chapter in the region's entrepreneurial tenure, but the next chapter, says Julia Spicer, executive director of the Mid-Atlantic Venture Association, which represents nearly 100 investment firms that collectively manage $90 billion and cover all stages of development, from seed funding to private equity. "I have been a long and passionate advocate that there are great companies here, but there has been a lag in reputation rather than in actuality," she says. What we're seeing now is the "sum of all parts" finally coming together and creating a new energy around entrepreneurship, she says.

It was only a matter of time that the region became a hotbed of startup activity, particularly in areas related to security, education, healthcare and energy. "There's a density of cities with Baltimore and Arlington nearby, a high concentration of talent," Spicer says. "And let's not forget, the largest customer in the world is right here."

Sarah Max is a freelance writer in Bend, Ore. She has covered business and personal finance for more than a decade for such publications as Barron's, Money, The New York Times and The Wall Street Journal. In 2009 Sarah got a first-hand look at the ups and downs of entrepreneurship when she helped launch 1859 Oregon'’s Magazine, a bimonthly print and digital magazine for which she is editor at large.

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