Newsmakers

A Thriving Startup Community: Why It Matters to Little Rock

Venture Center Fintech accelerator

It seems like everywhere you turn in the startup world, people are talking about ecosystems. It’s becoming one of those cliche business buzzwords like ideate, synergy, pivot, bootstrap, etc.
“Honestly, it’s a word I’m coming to hate,” admitted one academic professional here in Little Rock.
No matter what we call it, a nurturing and vibrant startup environment is vital to economic growth and development.
But why is this important in Little Rock?
Central Arkansas — and Arkansas in general — is behind many of her neighbors in the development of a strong and stable startup community and the infrastructure to support it.
This is not a bad thing. There are pains that come with change and growth, but there is also boundless opportunity to create something exciting and, pardon the cliche, revolutionary.
Jargon aside, central Arkansas sits positioned at the edge of potent growth possibilities. Many good things are happening. Startup support networks like the Delta Regional Authority’s Entrepreneurship Network are springing up and support organizations like the Venture Center are reaching out with mentorship, training and programs which improve the investability of startup ideas flowing into the entrepreneurial environment in central Arkansas.

Clear Communication Fosters Growth
As this climate of entrepreneurial support broadens, so does the confusion. The broader community only sees a portion of the big picture and is often left wondering what is happening and who’s doing what. That’s okay. Chaos through growth often leads to clarity.
That is where we are in the Central Arkansas startup community. Organization has begun to rise from the ashes of disorder. Creation is leading to momentum, and momentum leads to traction.
How can we harness the power of the momentum we are generating?  Here are the key factors which determine the health of a startup environment.

 

Qualities of a Healthy Startup Environment

1. Talent
Human capital is one of the most important aspects of a strong startup environment. Having access to the the right people to fulfill the needs of the startup business at its inception and cultivation is paramount.
Beyond the officers, founders, mentors and first adopters, a growing startup needs a talent pool of people with a relatively high tolerance for uncertainty. These first employees must demonstrate intelligence and an ability to adjust and redirect quickly.  Some people thrive on change and creative adjustment, and others thrive better in structured, predictable environments.
It’s important to have the right people available for the new company as it matures. Often the first employees on board won’t be the ones who will see the company through later stages of growth and development.

2. Talent Concentration
It’s not just important that the right talent be available; it’s vital that the right concentration of talent be accessible to the entrepreneurial endeavor. A strong startup environment draws in the right type of people.
There are reasons that areas such as the San Francisco Bay are known as “innovation hubs.” Startups and capital flood these areas for many reasons. A high talent concentration of the right type of people — those who are creative, open, driven, and focused — is like a large celestial body. As it rotates, it gains momentum and its gravitational pull draws more mass into it. Soon, critical mass is achieved and anything within its range is pulled into its orbit.

3. Robust Academic/Business Network
Not everyone who enters the startup environment is an entrepreneur. There are those who enjoy the entrepreneurial process but will never launch out on their own. They are great first employees, vendors, and support for the entrepreneur.
Academic networks and established businesses can help best when they understand what’s occurring in the startup space and how they fit the large picture of the startup community.  Connecting the powerful research that these sectors conduct to the commerce and economic generators in the community transforms and energizes the environment.
One reason that Silicon Valley became the hub of computer technology and the Bay Area has become a hub of startup development is that these areas of California lie at the center of powerful, leading academic institutions. The research and development coming out of these organizations is a powerful tool. In addition, these centers of higher learning draw the brightest and most creative minds from around the country and the world together in one place.

4. Culture of Innovation and Communication
“Innovation” is one of those cliche buzzwords which gets whipped around with little connection to its original meaning: change or novelty.
When we talk about innovation within the startup environment, we’re usually referring to change or novelty of a system or product. We’re talking about a business which does something in a novel way, or which has produced a product that is novel or unique.
For a strong entrepreneurial system to grow, the community must develop clear communication initiatives.  This is where the support of government agencies, such as the Delta Regional Authority, the Small Business Administration, and the Arkansas Small Business and Technology Development Center can play a vital role.
Connecting entrepreneurs to resources and educating them on what is available in their communities and around the region, as well as the role of government in economic growth, is a powerful tool.

5. The Money
Every entrepreneur complains about access to capital. “When you need the money, it’s hard to get; when you’re profitable and don’t need it, then everyone wants to invest,” observes Lou McAlister, master mentor at the Venture Center.
Often the reduction of risk is overlooked by the community. How can a startup community produce stronger, more investable companies and people? Like water flows along the path of least resistance, capital will flow along the path of least risk and greatest reward.

Little Rock as a Center for Economic Growth
The list above provides the framework for what it takes to foster economic growth and a vibrant startup environment. As we work together to grow the capital base and enhance the quality of the innovation in Little Rock and across the central part of the state, we stand at an important juncture.
We can become a center of innovation at the heart of the country, but we are going to have to work for it. We can create an environment that nurtures the development of great ideas which turn into real businesses.
This work, combined with spreading the story of what is happening and what has happened in Little Rock, has the power to draw talent, capital, and commerce to the heart of Arkansas. And when the heart of any system is healthy, the whole organism thrives.

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