Startup Communities: Building an Entrepreneurial Ecosystem in Your City

by Brad Feld

least half of the activity of government leaders feels like it is around the process of getting reelected. After an election, there is often a three-month lame-duck period where nothing happens, followed by a six-month period as the new administration gears up, puts new leaders in place, makes its plans, does its studies, writes its reports, and then launches its new initiatives. That’s nine months of a four-year cycle wasted. Startup communities can’t wait—they are growing and changing every day. It is well known that government can inhibit business activity. The easy things to pin on government are overwhelming regulatory activity, misguided tax policy that stalls investment in entrepreneurial companies, shortsighted tax policy that drives entrepreneurial companies to neighboring cities or states, and constrictive zoning rules, especially in downtown cores, that drive rents up and lower inventory of office and living space. At the minimum, these types of behavior make state and local government look stupid to entrepreneurs and directly contradict the entrepreneurs-are-important message that government often is trying to get out there. Other state laws, like those around noncompete agreements, stifle entrepreneurial activity. Historically, noncompete agreements were viewed as necessary to protect employers and companies. However, noncompete agreements have long been unenforceable in California and are often cited as one of the drivers of the health of the Silicon Valley e...