The blog of the John S. and James L. Knight Foundation
Photo copyright © Sam Goldberg used with permission.
Around the world the cost to start new ventures is dropping dramatically, democratizing the ability to build out ideas.
In 2000 it cost $5 million to launch a tech startup; now it costs $5,000, according to CB Insights. The Internet and mobile technology allow ideas to scale at warp speed. Consider it took Airbnb just four years to match the number of rooms that Hilton needed 93 years to assemble.
This presents a unique opportunity for cities – and, in particular, Miami. Never before have so many people had the ability to drive outsized change with so little.
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Amid this ongoing shift, we’ve asked a question here in Knight Foundation’s Miami Community program: Can these trends that are transforming our economy be leveraged to positively reshape our cities and communities at a scale and speed unlike we’ve seen before?
These questions have guided our work in South Florida. Over the past three and a half years, we’ve helped build an ecosystem supporting and propelling the city’s emerging entrepreneurs. This includes everything from co-working spaces and mentor networks to better access to investors, events and learning opportunities.
We’ve made more than 180 grants, ranging from launching the first Endeavor affiliate in the U.S., to starting The Idea Center at Miami Dade College and seeding the start of LaunchCode Miami, eMerge Americas and Black Tech Week.
Our thinking is that, alongside established centers of innovation, new startup communities are emerging around the world. Cities like Miami that take hold of this trend stand to benefit greatly by becoming places that attract and retain talent, offer expanded opportunities for residents, and cultivate increased civic engagement, along with fostering a greater community of problem-solvers.
Still, the report found, there is a noticeable impact and Miami possesses key differentiators.
Miami’s population is highly entrepreneurial, ranking in the top five in the U.S. for business formation per capita in each of the last five years. It is drawing talent internationally, as more immigrants per capita were tech entrepreneurs than any of the other top 25 metro areas in the U.S.
Even as the amount of venture capital in Miami remains comparatively low, the level of venture capital raised has increased five-fold.
Miami’s rapidly growing startup community is becoming increasingly interconnected. The study found examples of entrepreneurs operating across the ecosystem to meet their needs – from working at The LAB Miami to winning funding from angel investor groups like the Knight-supported Accelerated Growth Partners, to connecting at events like eMerge Americas or through mentor and support groups like Endeavor.
Of course, the report noted there is much work to be done. Miami, among cities around the world, is starting late and has a lot of ground to make up. Knight Foundation has invested substantially to help that happen, but to build on this work, the report recommended five steps:
• Continue increasing efforts to stir further investment, as funding in Miami is too skewed towards ventures in early or seed stages.
• Connect Miami’s emerging startup community with larger corporate enterprises for potential funding, mentors and business opportunities.
• Focus on Miami core strengths, including established industries, its connection to Latin America and the Caribbean, and the city’s unique diversity.
• Engage local government in helpful ways, including fostering a conducive regulatory environment, ensuring the most vulnerable parts of the community benefit from these changes, and championing successes.
• Continue supporting efforts to nurture and develop Miami’s talent pool.
The good news is that efforts supported by Knight Foundation in several of these areas are already underway. Startupbootcamp, an accelerator focused on entrepreneurs in health care, will launch this year. PowerMoves Miami, which provides access to funding and mentorship to entrepreneurs of color, opened in February. And the Babson Women Innovating Now (WIN) Lab, which provides mentorship and support for women entrepreneurs, is gearing up. And eMerge Americas, which has become a signature tech conference, will mark its third year April 18-19.
All the while, important global leaders in entrepreneurship have recently chosen to come to Miami. WeWork, the leading coworking operator in the world, is opening locations across Miami, the study noted. This year Cambridge Innovation Center, a key driver in Boston’s tech scene, is also launching in Miami.
It is rewarding to see so much activity taking place—but there is much to do.
What we remember in our work every day is that this is a long game. Most of the entrepreneurial efforts we have funded here in Miami are less than 2 years old, and some are just getting started. But we are living the transformation, and, if we are smart, we can leverage the trends reshaping cities around the world to drive meaningful change here in Miami in ways we haven’t yet imagined.