Boston a hub for entrepreneurs, start-ups
By Daniel Nordess, News Correspondent
Fueled by media, attention and the current economic climate, a city that has always been known for its innovation has proven to be a choice destination for the entrepreneurial spirit. In the past five years, more than 1,400 start-ups have been established in Boston alone, according to boston.areastartups.com, a networking and news website for start-ups in the city.
Facebook, Zipcar, LevelUp and other successful once-start-ups have their roots in New England’s economic capital – and not without good cause.
“There are not a lot of cities in the world where you have all the ingredients you need for start-up companies,” said Scott Kirsner, author of the Boston Globe’s Innovation Economy column, which covers inside technology, life sciences, start-ups and venture capital in New England. “But I think Boston is definitely one of them.”
While there is no precise formula for a nurturing, entrepreneurial environment, there are several major components.
“The single biggest part is the abundance of students and talent in a very clustered area,” said Greg Skloot, president of the Northeastern Entrepreneurs Club and a senior business and technology major.
Gordon Adomdza, assistant professor of entrepreneurship and innovation said being a smaller city gives Boston an advantage.
“Boston is really an ideal city for start-ups because of its size. You meet people who go to all the same events and all the same conferences,” Adomdza said. “It’s very easy to know people here.”
With more than quarter of a million students and some of the world’s most renowned educational institutions, Boston is conducive to talent. However, it takes more than technical know-how and a dream to bring an idea to entrepreneurial life.
“You don’t find really healthy start-up environments in places where there isn’t money,” Kirsner said. “It can be wealthy people who like to invest in start-up companies, or venture capital firms tapping into the talent pool when they need scientists, programmers, or marketers to start a company.”
Depending on the industry and nature of the business, start-up costs can be anywhere from a few thousand dollars to a $100 million. Boston provides the intimacy needed for close professional relationships as well as a financial climate conducive to venture investments, Skloot and Kirsner said. Though this community exists, some question its accessibility.
Maorun Najjar, winner of the Northeastern Entrepreneurship Club’s Start-up Challenge and a sophomore computer engineering major, said he felt while Boston has a great number of educational institutions, there is no easy way for students from different schools to connect.
“There is one thing missing though – the inter-college communication,” he said.
Some companies have stepped up to solve this problem. Founded by Jason Evanish, a Northeastern graduate, Greenhorn Connect has established itself as the Boston hub for entrepreneur resources, events and organizations.
The recent increase, according to boston.areastartups.com, in the number of new start-ups is a result of more than just the city’s talent and money – Boston has always had those resources. Some feel the notion of the start-up has been cast in an especially appealing light by recent success stories and media attention.
“I think first-time entrepreneurs come into it thinking they’re going to make it big; they learn very very quickly that it doesn’t work that way,” Najjar said.
The economy is also a strong factor in the increase in interest, Adomdza said.
“The rate at which people start companies increases in economic downturns, and a lot of Fortune 500 companies were started during economic downturns,” Adomdza said.
Oftentimes a start-up is founded by a group of professionals coming from companies who were forced to lay them off in trying economic times.
“The reality is, some people found start-ups not out of choice, but out of necessity,” Najjar said.
With this increase in start-up interest has come a rising demand for resources both in Boston and at Northeastern. A number of organizations have developed services catered to fledgling companies.
MassChallenge, a Boston non-profit, connects potential start-ups to the people and knowledge they need to be successful, according to its website. Teams from around the world are able to pitch their ideas to judges in hopes of earning one of 125 coveted spots in the MassChallenge Accelerator Stage – a three-month program in which teams are given everything they need to jump-start their success. MassChallenge is able to provide this opportunity because of donations from existing businesses.
“MassChallenge’s success in Boston is really based on the participation of the community,” director of partnerships Scott Bailey said. “Boston is really great at finding really motivated, driven people as well as the resources to back them up.”
Northeastern has a number of resources available to students with an idea and a passion. The Entrepreneurs Club provides students with a support network and the resources they need to change an idea into a business model. Likewise, IDEA, Northeastern’s Venture Accelerator provides students with coaching, mentoring and funding once their ideas begin to take form. These programs have received praise from people outside the Northeastern community.
“I’m really impressed by the resources Northeastern offers its students,” Bailey said. “We see a lot of great start-ups from there.” But students need only heed Najjar’s advice for success: “If you have an idea, get started.”