Washington DC Emerging Ecosystems (Blog Post)

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Washington DC Emerging Ecosystems (Blog Post)
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Washington D.C. Proximity to the federal government—DC startups have ties to the federal government Many entrepreneur founders worked for government—the largest customer in the world Potential solution for government problems Key people—Peter Corbett (founded iStrategy Labs, but also D.C. Tech Meetup & D.C. Week), President Obama (encouraging entrepreneurship--focus on tech & science) According to a report from 1776: DC has 726 total startups and 224 total exits (http://www.1776.vc/reports/innovation-that-matters-2016/) DC startup scores by industry: 22 education, 17 energy, 17 health, 21 smart cities Stable economy Highly educated population Revitalized urban core AOL AOL incubator: Fishbowl Labs AOL launched in DC in the 90’s dotcom boom hi-tech internet, telecom, software, and hardware manufacturers line the Dulles Technology corridor in Virginia Maryland—NHI 7 Lockheed Martin Notable ventures CoFoundersLab iStrategyLabs OPower Social Tables Speek TroopID SmartThings LearnZillion Livingsocial (Georgetown startup) Educated population DC metropolitan area has one of the highest concentrations of Ph.Ds per capita in the country 8.1% (highest number in the nation): percentage of total city population aged 25-34 with a degree Accelerators: Endeavor DC (internet startups) Acceleprise (tech incubator) The Fort accelerator Fortify VC (nurtures investors and entrepreneurism—received $100,000 in funding from DC mayor’s office) 1776 Incubator (modeled after 1871 in Chicago and General Assembly in NY) Digital with accelerators Halcyon Incubator supported by S&R Foundation Two-year-old incubator to encourage social entrepreneurship--select no more than eight fellows each semester First four months fellows live and work at the Halcyon House where they receive intensive review and training and decide whether their ideas are better suited for the private or nonprofit sector Second four months: move out of the mansion, but work out of the on-site office with full access to the business, public relations, legal and other resources of the Incubator Last six months: fellows transition to a shared workspace & work the incubator support team S&R has no stake in the company Inaugural class was selected from more than 200 applicants S & R Foundation: brings young scientists and musicians to DC DC success story Sachiko Kuno and Ryuji Ueno: Biotech entrepreneurs who own a pharmaceutical company (Sucampo Pharmaceuticals)--discovered a naturally occurring fatty acid that was turned into a drug to treat glaucoma and constipation 1996, they moved to DC to raise millions in investment capital Went public in 2007 D.C. Week (like SXSW)—10,000+ RSVPs Funding Grotech $1.2 billion under management & funds five to eight companies a year SXSLawn: Can link to Julia’s article Problems: DC people are hesitant to throw their money into startups Benefits to this: entrepreneurs are forced to stretch their dollars because they cannot expect massive rounds or sky-high valuations Developer salaries are lower=fundraising goals are lower DC’s VC firms, angel networks, and private investors still cannot compete with the extensive network and resources of Silicon Valley or New York—have to go to the Valley to get money When there’s a community, it makes it easier to start a company and easier to find money—easier to succeed. Kauffman Foundation: Ranked #25 in United States startup activity (ranked #28 in 2015) Rate of new entrepreneurs: 0.28% Opportunity Share of New Entrepreneurs: 75.76% Startup Density: 78.5 Ranked #1 in Growth Entrepreneurship in Metropolitan Area http://www.kauffman.org/microsites/kauffman-index/rankings/metropolitan-area?Report=StartupActivity&Indicator=Rank Rate of Startup Growth: 116.85% Share of Scale-ups: 2.34% High-Growth Company Density Components of a Washington D.C’s ecosystem Markets: Largest consumer in the world is the United States federal government Networks Early Customers: Human Capital Labor Educational Institutions Supports Infrastructure Support Professions Non-government institutions Culture Societal norms Success stories Finance Financial Capital Policy Government Leadership From the Ground Up: Defining Social Enterprise Ecosystems in the U.S. (Halcyon Incubator & Capital One) Washington is the most social entrepreneurial ecosystem-friendly city (look up what this means) Respondents tended to raise up to 50,000 Universities as incubators: American University, Georgetown University, George Mason University, George Washington, University of Maryland, Virginia Tech American University: Entrepreneurship Center: Sustainable Entrepreneurship and Innovation Initiative with a focus in technology, social, media, and the environment. Provides an initial $1,500 grant for each student team admitted to the AU Incubator & an Entrepreneurship Venture Fund can provide additional funding. Also offers a Big Idea Pitch Competition: two-minute video pitch with up to $2,500 in cash prizes. Kogod Case Competition has students analyze an existing nonprofit business and present their analysis and recommendations for the company. Also an AU Incubator Pitch (http://www.au-entrepreneurs.com/American-University-Incubator-AboutUs/) Georgetown University: Entrepreneurship Center: Georgetown Entrepreneurship Initiative with a focus on social entrepreneurship. Georgetown Startup Stipend Program covers student entrepreneurs’ debt payments for up to two years after graduation. Startup Hoyas Challenge throughout the year; hosts a hackathon, StartupWeekend Georgetown, Apps for Change, Rural Entrepreneurship Challenge: total business competition money offered each year totals $25,000. Doesn’t have formal investment in ideas/startups, but alumni gather informally to invest in student startups (had a lot to do with the launch of Georgetown Startup Stipend Program) George Mason University: Entrepreneurship Centers: Center for Innovation and Entrepreneurship; Center for Real Estate Entrepreneurship; Center for Entrepreneurship and Public Policy; Mason Center for Social Entrepreneurship; The Center for Nonprofit Management, Philanthropy, and Policy: Simulation and Game Institute & Mason Enterprise Center. Industry Focuses in Tech, Social, & Real Estate. There is grant money available to student entrepreneurs through the Mason Innovation Lab (seed funds for students and alumni teams). Dean’s Business Plan Competition that awards more than $20,000 in cash and prizes in the last few years. Pitch IT Competition (offers $5,000 in prizes). Student Venture Fund & Patriot Green Fund Alumni: Paul Singh, Martin Dunphy, Tom Moore & Brandon Labman, Zainab Salbi, Raymond Raybar Alumni Firms: Globox Rentals, True Honey Teas, Positive Deviancy, Pop! Wed Co, OnYou GW: Entrepreneurship Center: GW Office of Entrepreneurship with a focus on social, women’s small & family businesses & university/federal lab research based. $75,000 available annually (GW Business Plan Competition is the largest University based competition by prize money in the area exclusively for student startups. 2016--awarding over $100,000 in cash prizes. In-kind prizes are worth $41,000 and include free legal counsel, office space, and professional consultation services GW, UMd, & VT are all a part of DC I-Corps Node (part of National Science Foundation I-Corps Program)--given real-world training on how to incorporate innovations into successful products (main goal being to develop a new business or licensing opportunity) Cost of Living: Third most expensive market in the country to found a startup according to a new report from SmartAsset (http://dcinno.streetwise.co/2016/08/09/dc-top-3-expensive-city-for-startup-entrepreneurs/) Cost you $395,017 http://www.politico.com/agenda/story/2016/10/americas-innovation-crisis-000222 http://www.bizjournals.com/washington/news/2016/06/29/d-c-is-a-great-city-for-social-entrepreneurs-so.html http://www.denverpost.com/2016/10/04/steve-case-bus-denver-promote-entrepreneurship/ http://www.bizjournals.com/sanjose/news/2016/10/17/why-washington-d-c-can-never-work-the-same-way.html http://www.pbs.org/newshour/bb/african-american-female-entrepreneurs-funding-challenges-call-creative-bootstrapping/ https://www.washingtonpost.com/news/wonk/wp/2016/10/22/its-liberating-the-revolutionary-products-transforming-the-way-women-think-about-their-periods/ http://dcinno.streetwise.co/2016/10/05/7-dc-tech-startup-entrepreneur-immigrants-to-watch/ http://www.ctpost.com/news/article/Steve-Case-Names-4-Industry-Areas-Ripe-for-10417445.php http://www.1776.vc/reports/innovation-that-matters-2016/denver-co/ http://www.1776.vc/reports/innovation-that-matters-2016/los-angeles-ca/ http://www.bizjournals.com/washington/news/2016/10/17/1776-co-founder-evan-burfield-moves-to-arlington.html http://dcinno.streetwise.co/all-series/dc-tech-startup-innovator-donna-harris-1776/ http://www.businesswire.com/news/home/20161005005379/en/Startup-Incubator-1776-Teams-Accenture-Digital-Health http://www.automatedtrader.net/news/at/156357/washington-dc-opens-blockchain-innovation-center http://dcinno.streetwise.co/2016/10/26/dc-tech-startup-mpower-financing-6m-funding-student-loans/ http://dcinno.streetwise.co/2016/04/26/dc-tech-startup-incubator-1776-plans-dubai-campus/ http://dcinno.streetwise.co/2016/06/03/1776-challenge-festival-pitch-competition-2016-details/ https://www.washingtonpost.com/business/capitalbusiness/1776-could-soon-start-licensing-software-to-other-incubators/2016/08/14/9443f226-6003-11e6-9d2f-b1a3564181a1_story.html http://technical.ly/dc/2016/03/14/1776-brings-on-erin-mcpike-in-communications/