View profile

Economies Aren't Built on Sunshine

By some measures, Florida is an economic powerhouse. We are on pace to have a $1t (with a T, folks) e

Urbn Developments

February 27 · Issue #8 · View online
Longform (ish) observations with a historical twist. Exploring all things urbanism, adaptive reuse, and good old-fashioned city building. Written by Lucas Lindsey.

By some measures, Florida is an economic powerhouse. We are on pace to have a $1t (with a T, folks) economy by 2018, making us the 16th largest economy in the world. We’ve built a lot of it on beaches, boats, and Mickey Mouse. 
By other measures, there are cracks in the foundation. Many of our cities have the lowest paying urban area jobs in the country, and our statewide median wage is 7th-lowest nationally. And that’s because a lot of those jobs rely on beaches, boats, and Mickey Mouse. 

Any comprehensive and high-wage economic development strategy must include a focus on innovation and startup support. Florida has not found that focus, nor has it prioritized entrepreneurship-driven economic development. Instead, we’ve juiced every last drop out of our natural resources, and I’m here to tell ya you can only squeeze so many jobs out of an orange. 
One thing that’s held us back? Geography. Our state is big. If you don’t detour to Weeki Wachee for the underwater mermaid show or the Space Coast to watch SpaceX land a Falcon 9, it’s something like a 13-hour drive from Pensacola to Key West.
Democratic strategist Steve Schale, renowned for delivering Obama this quasi-southern swing state in both ‘08 and '12, knows the interstate laced oddity that is Florida. He’s studied Florida’s culture upside down inside out and sideways, and he calls it a 5 state commonwealth. Others think about it by media market. But however you slice up the state, the reality of division remains, and that hampers startup activity because thriving innovation ecosystems rely on systems of collaboration and trust. 
The State of Things
Entrepreneurship as economic development is not a new idea. It’s just one that, despite Florida leading the nation in transplants, somehow hasn’t migrated to the Sunshine State. Ohio’s Jumpstart Network, for example, led to $3b in economic impact and 10,000+ new jobs in Northeast Ohio.
Not southern enough for you? In just four years, LaunchTennessee’s statewide model has helped entrepreneurs create 1,500+ jobs and raise $200m in early-stage capital.
Successful program and policy models are one Google search way. Lack of action at the state level can be blamed on only one thing: lack of vision.
This has led to an undeniable reality. Our state is behind the curve. We rank just 34th on Bloomberg’s US State Innovation Index
Investment data isn’t any prettier. Florida-based companies captured less than 1% of total venture capital activity in 2016. Our $1.12b investment total lands us 8th among other states in the US, but MagicLeap’s $790m mega deal in Q1 2016 accounts for more than 70% of the $1.12b. If you remove MagicLeap from the picture, Florida falls, by my back of the napkin arithmetic, to 16th. 
Venture Deal Activity Q4 2016 | Source: PwC Moneytree
Venture Deal Activity Q4 2016 | Source: PwC Moneytree
Florida Venture Deal Activity Q1 2014 - Q4 2016 | Source: PwC Moneytree
Florida Venture Deal Activity Q1 2014 - Q4 2016 | Source: PwC Moneytree
Long story short: We are not on the cutting edge, and unless we articulate a bigger vision, make strategic investments in our innovation infrastructure, and throw support behind our best entrepreneurs, we will fall further behind. 
As the third largest state in the country and home to 40 billionaires on the Forbes 400 list, we have to do better. The future demands it.
A Statewide Movement
Luckily, there are ecosystem builders, both young and old, leading startup support organizations in every major city of Florida. They work long hours, battling for sustainability and recognition, not just for themselves but for the entrepreneurs they serve. They’re for-profit, non-profit, and everything in between. They feverishly stitch together philanthropy, sponsorship, grants, and (god bless it, that sweet nectar) reoccurring revenue in an attempt to mitigate a well-documented market failure: systemic underinvestment in innovation.
This merry band of grassroots startup pirates is a start, but it not enough. I know because I’m one of those pirates, and I’ll be the first to admit that our work is, viewed through a statewide lens, ad-hoc and uncoordinated. Instead of deploying a collaborative model to achieve economies of scale, such as shared mentor networks, investment syndication, and promotional outreach, we are each busy building our own metro-wide ecosystem. I believe that if we get together a little more, build trust, and invest in meaningful relationships, those geographic walls will crack and crumble. 
And that is, at its core, the theory of the case behind LaunchFlorida. LaunchFlorida was announced in February as a 50+ member coalition of the state’s tech organizations, startup spaces, and investment groups–all leaders in building Florida’s innovation ecosystem, each working at either a city or regional scale to create a community of support around innovation and entrepreneurship.
LaunchFlorida arrives on the scene at a time of upheaval. Citing claims of corporate welfare and footloose spending, the House has threatened to kill both Enterprise Florida and Visit Florida. Taken together, the two agencies represent the bulk of Florida’s substantive economic development policy. 
To his credit, Sen. Brandes has filed a competing package in the Florida Senate that not only retains core functions of the two organizations but proposes a statewide Startup Florida grant fund to support the operations of incubators and accelerators across the state. Where this political dance leads is anyone’s guess, but it is heartening to see elected officials consider startup support alongside more traditional economic development tools. 
LaunchFlorida is a grassroots, community-led step in the same direction, but we are not naive enough to think it is a silver bullet. Our goal is to build peer-to-peer connections across the state’s startup support network, leverage shared resources, and find common ground to drive Florida’s innovation economy forward. Is it going to be easy? No. Are we guaranteed to succeed? Absolutely not. Will a little hard work and long shot odds stop us from trying? Please.
Given the vacuum at the state level and the tendency of entrepreneurs to err on the side of action, we have no choice but to give this a shot. 
In Closing, Some Real Talk
Floridians have a decision to make. Do we want to be a place where the innovators live, where we share equity in a high-growth future? Or do we want to be a place where the innovators vacation, and we work for tips?
Under leadership that values innovation, startup support is prioritized. In that world, entrepreneurship is empowered, and homegrown startups are embraced as vehicles for wealth creation and economic growth. That’s the world I want, and I know a few others want it, too, so we’re going to do what we can to build it. 
Urbn News Roundup
Startup Capital, The Podcast: Season 2, Episode 1
PowerUp Partnership Helping Local Businesses
Rise of the Startup City
The Urban Optimist: A Conversation with Daniel Doctoroff
Like this sort of stuff? I post a ton more of it, drip by drip, on Twitter. Follow along here.
Did you enjoy this issue?
If you don't want these updates anymore, please unsubscribe here.
If you were forwarded this newsletter and you like it, you can subscribe here.
Powered by Revue