In eight years on the City Council, the one phrase I have heard more than any other is “economic development”. This means a different things to different people – jobs, tax revenue, easier permitting for businesses --but to me it has always meant creating a prosperity that can endure and benefit us all.
I spent Friday and Saturday participating in the economic development discussions at the National League of Cities annual conference in Phoenix. I focused on the sessions dealing with growing small businesses and helping entrepreneurs. I talked about Ventura’s experience in trying to nurture high-tech businesses, but I heard a lot from other cities and experts about what’s working and what’s not
There were a lot of people there telling their stories – people from Boston and Scottsdale and New York and all over the country. They mostly told stories about how cities can work with universities and others to foster the expansion of what are sometimes called “high-potential” businesses in their communities using incubators and “accelerators” (business centers designed to accelerate the growth of businesses once they are incubated). And the lessons were pretty clear: know what you’re trying to accomplish; make strong connections with your local universities; build an “ecosystem” of necessary services around the business sector you’re trying to grow; and, perhaps most important, be persistent and patient, because it takes a long time.
In Ventura, we have placed a lot of chips on nurturing tech businesses in the incubator we have created beyond City Hall. We targeted Internet startups for the incubator – companies that build things like online advertising auctions, geographical locators, and the like – because we knew that’s a business sector with very high growth potential that had a presence in neighboring cities, especially Carpinteria and Santa Barbara. We targeted ‘Net-based companies because they can raise large amounts of Ventura capital (many of the companies in the incubator have raised millions) and because each one has the potential to grow very, very fast. So far, we’re successful. There are currently 14 companies in the incubator with about 50 jobs altogether. But if even one of these companies because a big success, that will mean hundreds of jobs and lots of opportunities for vendors and suppliers in Ventura.
So what I learned in Phoenix is that we have a long way to go. Yet I was encouraged by what I learned.
From Boston – where Mayor Ray Mennino is setting up an “innovation district” – I learned that connections not just to science-based colleges but colleges focused on entrepreneurship are important. Babson College, a leading entrepreneurship college based in the suburbs, is setting up an operation in Boston at Mennino’s innovation center. There’s a lesson here. We already have a strong relationship with UCSB, where the engineering school spins off a lot of startups. But we need to strengthen our relationship with Pepperdine, which has a great entrepreneurship program. Hey, Pepperdine, want to set up a branch here in Ventura?
From Arizona – where the City of Scottsdale decided to collaborate with Arizona State on an incubator/accelerator called SkySong ] -- I learned that you have to be patient even in the face of political criticism. SkySong’s been criticized for creating “only” 700-some-odd jobs so far, rather than the 10,000 promised. But as one of Skysong’s leaders said on Saturday, this is a long-term play. It takes 10 or 20 years to pay off – but if you do it right, it pays off for decades. (By the way, there's a really good urban revitalization story with SkySong. It's located on Scottsdale's old "auto row," and after flirting with both a Wal-Mart and an arena, Scottsdale did a deal with ASU.
Everywhere at the conference I learned that social media is important. The entrepreneurs in these growth sectors are mostly young, and they know how to use the Internet. After all, most of the startups in Ventura are Internet-based companies. I’m very proud of the fact that NetProspex recently ranked Ventura as the 4th most social-media-savvy business city in America – behind only New York, San Jose, and San Francisco. This means we ranked ahead of places like Seattle, San Diego and Austin. I can’t exactly explain why this is – my theory is that it has something to do with surf-town folks who seem mellow but are really pretty intensely interconnected – but it shows you that this is one really important part of the strategy that we are really on top of.
So going forward, what do you we need to do? There’s so much, but here are a few things:Keep strengthening our university partnerships, so that UCSB, Pepperdine, Cal State Channel Islands, Ventura College, and others all play a role in our effort – and recognize that what we’re doing helps them too.
Keep building the ecosystem of services that these entrepreneurs need. That means making sure that angel investors, venture capitalists, intellectual property lawyers, and others know Ventura and want to do business here. It also means connecting these growing companies to local vendors, so that the economic benefits of their expansion stay local; and with local real estate brokers and landlords, so the companies themselves will stay in town.
Make sure these companies have the infrastructure they need. Right now our biggest problem is that our fiberoptic telecommunications network is spotty and doesn’t even reach the incubator. Ironic for an Internet-based economic development strategy! We must keep working with the telecom companies to bring good fiber to the places we need it.
In other words, we need to make all of Ventura into an accelerator.
So often, economic development is about the short-term win – luring in the big plant that will immediately provide jobs, grabbing the big retail store that will immediately throw off sales tax revenue. These short-term wins are important, but having worked in economic development for almost 25 years I have to say they often don’t last. The plant closes, the store moves – all for reasons the community has no control over.
But our high-growth tech effort is different. In Ventura, we have a once-in-a-generation opportunity to create an enduring prosperity that will last us many decades. We can nurture locally based businesses that have vast growth potential. We can create hundreds – maybe thousands – of great jobs for people who live here. We can create a huge amount of new activity for local businesses who will serve the tech companies. We will create the consumer demand that will drive retail sales – and sales tax revenuf or our city. We can generate the wealth we need to endow our community and our civic life for many years to come.
We can do all this. But it takes patience, persistence, and focus – day after day, month after month, year after year. But I am convinced that the payoff is worth all the effort required to make this effort work. So let’s make all of Ventura an accelerator for our tech businesses. It’ll help every business, ever household, and every civic institution in town.