Startup Communities: Building an Entrepreneurial Ecosystem in Your City

by Brad Feld

The best service providers invest their time and energy for no charge in early-stage companies.

Large companies can play an important role in any startup community.

The two most powerful things large companies can do for the startup community are (1) provide a convening space and resources for local startups, and (2) create programs to encourage startups to build companies that enhance the large company’s ecosystem.

The problem comes when the feeders try to lead or when there is an absence of leaders.

giving people tangible things to do, you quickly separate people who are willing to engage from those who merely are looking to network or simply get something from the startup community.

BE INCLUSIVE

leaders are the gatekeepers and should make sure the gates are always open.

easy-to-access events (http://startuprev.com/l0).

The best startup community leaders are constantly nurturing new leaders,

PLAY A NON-ZERO-SUM GAME

BE MENTORSHIP DRIVEN

people who declare themselves to be leaders say nonsensical things like “I don’t have time to be a mentor.” They fundamentally miss the point of what a leader does.

What did they want SendGrid to become? How did they define success? Did they feel that SendGrid would ultimately be worth much more than this offer? Did they think that future financing would be available to them? Did they think that they could be the best in the world at this one thing? Did they think the acquirer could come out with a competitive product in a reasonable time period?

GIVE PEOPLE ASSIGNMENTS

Giving people assignments works as a tool for figuring out who are doers and who are leaders.

Think of your startup community as a lean startup—one that needs to try lots of experiments,

year. Intellectually honest organizations call out which initiatives had little or no progress; great organizations kill the initiatives that were failing and put their energy behind the ones that are working. One easy filter is whether leaders for the individual initiatives emerge on their own. If the leaders of the overall organization have to assign the initiatives, then these initiatives likely are of lower value. However, if participants in the organization or the broader startup community step up and take on the specific initiatives, their chance of succeeding is much higher. More importantly, the fact that individuals are drawn to lead specific initiatives emphasizes the relative importance of the initiatives. Having specific initiatives fail must be an accepted part of the culture of a startup community. As in entrepreneurship, failure is simply part of the process of creating something great, rather than an endpoint. If failure is not acceptable, bad ideas will perpetuate and people who ultimately decide they aren’t going to spend more time on something destined to fail will withdraw from the community. To be successful, embrace failure as part of the process.

classical problems along with suggestions about what you can do about them.

leaders of yesterday encourage and embrace the leaders of tomorrow,

Boulder operated as a network and Denver operated as a hierarchy.

solution to the patriarch problem,

First, I suggest that you just have to wait for a bunch of people to die.

Next, the leaders of the startup community should simply ignore the patriarchs.

Over and over I hear one thing from entrepreneurs: “There is not enough capital here.”

There will always be an imbalance between supply of capital and demand for capital.

Although government can play a constructive role in startup communities, a reliance on government to either lead or provide key resources for the effort of building a startup community over a long period of time is a misguided view.

When a startup community starts relying on government to be a leader, bad things happen.

few people in government have a background as entrepreneurs,

Government also moves at a much slower pace than entrepreneurs

government runs on a very different time cycle—typically

difference between a hierarchy and a network.

the best startup communities operate as networks:

There is rarely a leader of a network, just nodes that are interconnected.

Entrepreneurs live in networks. Government lives in a hierarchy.

It takes a generation of effort to get a startup community up and running in a sustainable way.

When universities try to emulate MIT and Stanford, they often try to position themselves at the center of all the entrepreneurial activity, viewing their role through the lens of technology transfer (we must generate lots of new startups) or control over the innovation (all the IP belongs to us—we will share it if we get a piece of it). Neither of these approaches are particularly effective.

Although each of these types of feeders, and others, are important, when they try to control what’s going on in the startup community, they often retard the actual growth of the startup community.

When a hierarchy instead of a network drives an entity, it almost always classifies it as a feeder.

high-growth startups aren’t constrained by city or state borders.

As a society, we are far from the saturation point in terms of entrepreneurship.

take a network approach and connect your startup community with neighboring ones.

OFFICE HOURS

how to plug into the startup community, I suggest they go to BDNT every month, for six months

One activity that helps foster a startup community is a regularly occurring event by the community for community.

The Boulder Open Coffee Club

there is no better way to learn how to do something than actually doing it;

Sao Paulo Beta, founded by Pedro Sorrentino,

—Tim Falls, SendGrid, @timfalls

Have a topic.

Good content matters.