The focus on “ecosystems” as a contributor to startup community success has recently begun to receive additional attention from academic researchers. A healthy and vibrant entrepreneurial or venture ecosystem can provide a nurturing environment for startups and innovators. This boosts job creation, economic growth, and talent attraction. Innovation itself includes both de novo (i.e. brand new) startups as well as new undertakings by large and small organizations. As a result, we prefer the term “venture ecosystem.” Think of a venture ecosystem as being kind of like a marine reef. It is a home for a variety of life forms including coral, fish of various types, and a host of other life forms with often symbiotic relationships.
So what makes up an “ecosystem?” It is a combination of people, places, and organizations or tangible assets. But it is also the history and institutions that shape and are shaped by those people over time or intangible assets. It incorporates a cultural element that reflects the attitudes, beliefs, and behaviors of all the individuals within that ecosystem. Thus, venture ecosystems include both tangible assets as well as intangible ones. Often, certain pockets of industry or market expertise are associated with an ecosystem—like orthopedic devices in Warsaw, Indiana, and marketing automation in Indianapolis. Some important components of a vibrant ecosystem include:
Culture that supports startups
History of successful entrepreneurs
Talent, including universities that are engaged in the community
Networks that support entrepreneurs
Mentors and role models
Policy and governance including state and local government support
Support services (e.g. attorneys, incubators and accelerators, marketing agencies, etc.) that work with startups
Physical infrastructure like work spaces
Open markets that provide access, even to smaller firms
Investment capital
Venture ecosystems are somewhat bounded by geographic boundaries that are either major cities or regions…think Central Indiana, Silicon Valley, Boston, the Washington, D.C. area. But some organizations span multiple locations or are even international and thus participate in multiple ecosystems. Powderkeg, for example, a tech community support organization founded and based in Central Indiana, has had a presence and meetings in other cities including Cincinnati (OH), Nashville (TN), and Denver (CO). But with COVID-19, Powderkeg’s reach has broadened to cities across the country. SoPE, the Society of Physician Entrepreneurs, is a center of gravity for innovators in life science industries. SoPE has nearly 30 chapters around the world including one in Indiana. Some of its activities have global reach, while others are rooted in city- or state-based chapters.
Why do I say “Central Indiana?” Indianapolis is certainly a center of gravity in our local venture ecosystem. But it is essential to incorporate the innovation engines that run the SR 37/69/65 corridor from Bloomington, which is the home of Indiana University, to West Lafayette, the home of Purdue University. It is probably generous to extend “Central” further, but certainly universities like Notre Dame, Ball State, and Rose-Hulman also provide important assets and contributions to the Central Indiana venture ecosystem. The number and quality of university graduates and intellectual property rival a similar geographic ring around Silicon Valley. How (and if) universities interact with their venture ecosystems is an important element of a healthy mix of ideas and talent.
The Kelley Evening MBA program has offered a class that connects our students to the venture community of Central Indiana. In fact, this class is in its 20th year (we started it in 2001) after our advisory board suggested we strengthen our connections to the innovation community outside of campus. Participants in this learning experience have become Presidents of the Venture Club of Indiana, entrepreneurs, and leaders in the venture ecosystem here and in other regions. In fact, a couple of alumni head up the IU Kelley and Purdue alumni groups in San Francisco (which is still striving to be “the next Central Indiana”).
Founders, innovators, investors, and other participants in the venture ecosystem should become aware of the organizations and people who make up their ecosystem, as well as the places where they congregate. Being better networked into your ecosystem can help you much more quickly secure feedback and advocacy, connect with potential customers and investors, and identify talent as you scale. Paying back is an important component of a healthy venture ecosystem—having successful entrepreneurs and innovators mentor, support, and invest in the next generation of innovators. But paying forward is also key—regardless of your level of experience and expertise, you can be a sounding board for your colleagues and others trying to move forward with an inspiration and idea. You don’t have to be the biggest fish in the reef to contribute to its vitality or beauty!
In the coming weeks, we will focus on specific communities or pockets of entrepreneurial activity and some of the supporting organizations that they might turn to for assistance and connecting to like-minded others. We will focus on women innovators, innovators of color, life science-focused innovators, technology innovators, and social entrepreneurs. Regardless of where you are, there are support systems out there to help you thrive. Start to identify and connect with your community. Not only will it be a great source of help for your own startup and innovation efforts, but also you will find it rewarding in and of itself.