A Tale of Two Geographies: London and Connecticut
What makes a place a great launch pad for an entrepreneur?
The question has become increasingly important, not just in the United States, but around the world. On a recent trip to London, I was inspired to look at the differences and similarities between Connecticut’s startup/entrepreneurial ecosystem and that of one of the world’s 25 largest cities by population.
Competing Globally for Entrepreneurs
Why does looking at entrepreneurship and innovation ecosystems matter? For a simple reason: competition. While the emergence of global brands and dynamic global competition is, by now, old news, the once murky, understudied world of entrepreneurship has become a global industry.
For example, it’s now widely understood that big companies don’t spring forth fully formed from the brow of Zeus. Crazy, bold entrepreneurs and innovators build the next great companies, sometimes over decades. And that process of becoming big contributes disproportionately to economic growth; studies (such as this study by the Kaufmann Foundation) show that net jobs, wealth, and value in the economy are created through this process.
So if they want to promote a thriving local economy, countries, states, and towns must have a strategy to support and retain their innovators.
It’s also been widely observed that many, many entrepreneurs are working on similar themes from different angles. Consequently, as an entrepreneur, choosing your ecosystem is an important business decision. You have options. This is especially true for young entrepreneurs, who are generally highly mobile.
An examination of the similarities and differences between one ecosystem and another highlight an additional fact: it isn’t just money that makes for a good environment. Features like mentoring programs, collaboration spaces, community events, connections to local corporate customers, and the support of the local business community and government can make the difference for entrepreneurs still learning the ropes.
London vs. Connecticut
Before you can really compare two ecosystems, you have to compare the areas in which they exist. London’s metro area includes about 15 million people, covering about 3,236 square miles; the State of Connecticut, about 3 million people, covering about 5,543 square miles. Median household income is about $68,000 in Connecticut; in London, about $43,000. So London has a more highly concentrated population, while Connecticut has higher household income.
In a city environment, features like robust public transportation (such as the system in London) can make for a very connected, accessible ecosystem. Of course, urban density means sacrificing personal space and can mean a higher crime rate; while in a mixed urban, suburban, and rural setting like Connecticut, there’s much greater access to space and nature, with less congestion; but density is sacrificed.
As in most competitive situations, knowing your fundamental value proposition is crucial to attracting the kind of people who need your product. Ecosystems are no different.
Programs & Resources in London and Connecticut
Open-Access, Flexible-Term Collaboration Spaces: TechHub (now part of Google’s London campus), Warner Yard, Innovation Warehouse, Campus London, and some 30 other spaces support entrepreneurs and ventures in general (according to the website of the London coworking GoCoWo). Of course, Connecticut has spaces like The Grove, Stamford Innovation Center, the BHive, Axis 901, and other incubators and accelerators, including some that are coming on line in the near future.
Seed Capital Programs: Connecticut’s Innovation Voucher program, access to SBIR funding, and the CCAT grant program are comparable to London’s access to British business development programs.
Mentoring: Business bootcamps, mentoring programs through coworking spaces and the City, and other training programs are a mainstay of the London ecosystem, just as they are becoming so in Connecticut, with such programs as Bootstrapper’s Bootcamp in New Haven and CTNEXT mentoring programs, among others.
“Empty Spaces” Programs: In both Connecticut and London, local government has worked to address the issue of empty spaces during the recession with similar programs. In London’s case, the Meanwhile Space program provides space to artists and innovators in exchange for use of the space and a possible long term lease. The Project Storefronts program created in New Haven and now spreading throughout the State operates in a similar way.
What does all this mean?
First, it’s a good time to be an entrepreneur. We’re living in a time of unprecedented support for the tough work of starting and growing a company. Second, all of this is potentially terrible for regional governments (and startup communities they take part in), at least those that can’t respond to the changing times. Today, it’s not just the city or town down the block competing for the talent and startups in your town. While once upon a time, Silicon Valley was the only ecosystem with a tractor beam pulling talent and startups from around the U.S. and the world, Israel, London, Russia, and various cities around the U.S. are now pulling at the same talent pool. And it’s likely that many cities, states, and towns are ill-equipped to understand how to support entrepreneurs, because it hasn’t been a focus for efforts or training in the past.
The good news for some, however, is is that globalization has given us at least a few great gifts. Cheap airfare, cheap international communication tools, and globally recognizable products and services (essentially, greased skids for anyone to move anywhere to work for anyone) can work to the advantage of the small as much as the large. After all, not everyone likes big city traffic, parking fees, or tiny apartments.