25 Jun Why Bloomington/Normal Needs a Startup Incubator and How The Community Can Build One The Right Way
“Building a startup community is not a zero-sum game in which there are winners and losers: if everyone engages, they and the entire community can all be winners.”
— Brad Feld
Developing an entrepreneurial ecosystem takes years, if not decades, of hard work, collaboration, and investment. But it’s worth building. Cities like Boulder, Colorado and Columbia, Missouri, both with a smaller population than Bloomington-Normal, have become coveted destinations for entrepreneurs. They support and grow startups, and their cities have thrived because of it.
In Mid-May, a group of local community members, including representatives from Illinois State University (ISU) and Illinois Wesleyan University (IWU) traveled to Northern Iowa to visit a college incubator and several co-working spaces. This trip was an early step towards building a startup incubator here in Bloomington-Normal.
What is an Incubator?
An incubator is a support system that helps new startups get off the ground. Commonly, they provide temporary workspace, a small amount of funding, mentors, training, and other resources. The goal of an incubator is to give each of their startups a better chance at success.
The Benefits of Building an Incubator in Bloomington/Normal
An incubator, much like a business, provides benefits for the community in a variety of ways. I see a well-constructed and operated incubator providing the following benefits to our community:
- Encourage new business ideas from high school and college students.
- Give additional incentives for people and small businesses to stay in McLean County instead of leaving for Chicago or other entrepreneurial hubs.
- Assist the private sector in getting involved in companies and innovation outside of their operations.
- Provide much-needed help to local startups.
- Attract startups and early-stage companies from neighboring cities.
- Transition startups into self-sustainable small businesses, adding jobs and revenue to the area.
- Bring additional attention to involved local universities, helping them fundraise and recruit students.
We learned a lot from our trip to Northern Iowa, touring the John Pappajohn Entrepreneurial Center Innovation Incubator and multiple co-working spaces. The biggest takeaway from the trip was that to bring a successful incubator to our community, which could provide a long-term boost to our economy, donors are key. An incubator is more than a co-working space with some nice furniture and an office manager. It’s a substantial investment in the community and the businesses the incubator will serve.
Co-working spaces, however, do play an important role in an entrepreneurial ecosystem. Since incubators only provide temporary residence to startups, these businesses need inexpensive, convenient, and flexible environments to work to help encourage them to stay in town after graduating from an incubator. The Northern Iowa incubator also required collaboration among the university and local community and businesses in Cedar Falls and Waterloo, Iowa.
The Cost of Getting Started
John Pappajohn donated money to five universities across Iowa to lay the groundwork of what has now helped launch over 1,000 companies. The money, as it did in Iowa, will need to come from the private sector — businesses or individuals not associated with the government that have a vested interest in the community.
In addition to the funding needed, an incubator requires a team to run it and another team to create and manage a co-working space, or several, that would work alongside it.
Unfortunately, this is a 5-10 year process that requires collaboration among all stakeholders. We are working to involve all three schools (ISU, IWU, and Heartland) in the process — helping move the project along quicker and bringing more resources to the table. We are bringing representatives from the business community and the three schools in town together to meet, discuss, and start creating early plans.
An incubator is a part of a long-term plan for developing an ecosystem. It is not an overnight solution to replace what has been lost over the years with businesses leaving and a constant stream of layoffs. It will take sustained support from members of the community, local government, and local businesses, but by taking the first few steps in this direction, we can begin to build a stronger ecosystem and a brighter future.
If you are interested in staying in the loop about this project or getting involved in some way, please contact me at Michael@ConsultStraza.com.