An ideal entrepreneurial ecosystem? How collaboration can pave the way in Northeast Ohio
Northeast Ohio is a region of innovators and risk takers, where the entrepreneurial DNA can present itself as a brick-and-mortar business or a single dream maker creating a product out of their garage.
Ideas are essential for entrepreneurs, but ideas alone are not enough to transform the wider community into Silicon Valley Midwest, notes Baiju Shah, president and CEO of the Greater Cleveland Partnership (GCP.) Money is needed. And local venture capital — the investments startups need to succeed — is still in short supply, a trend that will only continue in the face of a looming recession. Additionally, he said, area economic development organizations must more effectively link would-be owners to available business resources.
“We need to do a much better job of making sure there are actual connections between companies and the opportunities that exist out there,” said Shah. “We’re talking to partners like JumpStart (a Cleveland-based venture development organization) and MAGNET (a Cleveland-based manufacturing consulting organization) about the mechanisms by which we can do this. How do we make sure our entrepreneurs tap into these opportunities in the same way that small businesses do?”
Regional stakeholders say they are thrilled about Northeast Ohio’s prospects but aware that the local environment is not as robust as it should be. Shah sees the possibilities first-hand with Cleveland Chain Reaction, a neighborhood pitch competition spearheaded by GCP’s Council of Smaller Enterprises and other area economic groups.
Participants take part in a boot camp hosted by JumpStart, while also gleaning knowledge from business experts and entrepreneur-friendly mentors. Winners receive cash prizes as well as advice from seasoned business owners. All applicants get an education that Shah would like to see become more widespread.
“We want to broaden that for entrepreneurs looking for revenue growth,” Shah said. “That can be working with organizations around grant opportunities with the federal government, but it’s also assisting smaller companies in recognizing market trends.”
Connecting the dots
Uplifting minority and other underserved populations is a vital facet of strengthening Northeast Ohio’s connective tissue, added Shah. For example, GCP’s CommitCLE initiative centers on racial and ethnic minorities, a demographic representing just 2.4% of supplier spending, according to a GCP study of regional industry sectors.
Minority entrepreneurship is also a major focus of Akron’s Bounce Innovation Hub. The group’s GROW program – which stands for Generating Real Opportunity and Wealth – provides women and people of color idea generation skills alongside mentorship and brand development assistance.
Fostering access and trust is crucial for these populations, while removing common obstacles to success is something that benefits all entrepreneurs, said Jessica Sublett, who became Bounce’s CEO in January following the retirement of Doug Weintraub. She’s served as chief operating officer since 2018.
Many business owners suffered losses at the height of the pandemic, and Bounce is intent on preparing them for this year’s predicted recession.
“It’s about making sure people understand their cash flow, their necessary expenses, and how much runway they have,” said Sublett. “It’s going to be (about) dollars and cents as we go into surviving a recession and coming out on the other side. How are we putting these companies into a position to be resilient in that process?”
Capital-intensive industries such as advanced materials and life sciences may suffer in the coming months, doubling the challenge for Bounce and its allies to find investors willing to wait out the storm. In the interim, entrepreneurs are wise to assemble a veteran advisory team, said Sublett.
“We also need a little more connectivity to our business ecosystem,” Sublett said. “There are so many smart people working in Northeast Ohio industries who can do skills-based volunteering. If we can connect some of those dots, whether in financial advice, HR or people working in marketing or sales, that can be really impactful.”
Big wins in 2023?
The Manufacturing Growth Advocacy Network’s (MAGNET) new headquarters in Cleveland’s Hough neighborhood can be the physical representation of the region’s future entrepreneurship environment, said president and CEO Ethan Karp.
Weaving manufacturing innovation into the community will take time, but Karp is nonetheless excited about the possibilities. MAGNET’s new 53,000-square-foot home in the renovated Margaret Ireland Elementary School is already connecting people to training and jobs, while increasing manufacturing innovation and providing regional factories with advanced technologies, Karp said.
Although full-time programming remains in the planning stage, Karp expects young learners to tackle connected computing, machine learning, enhanced automation and other applications that define the so-called “Industry 4.0” revolution. Such transformative technology can align students with lucrative work at large companies like Lincoln Electric, according to Karp. Just as crucially, he believes, it can spark a fire of innovation and business development in pliable young minds.
“Being in Hough is important, because we’re connected to Midtown and the innovation going on there,” Karp said. “We’re showing that innovation is not just happening in the suburbs – it’s happening in our city, where people can use those opportunities to better their lives.”
Ideas for new products come in waves, with many manufacturers, for example, pivoting to personal protective equipment when the COVID-19 pandemic started. With help from a connected network of boosters, entrepreneurs can innovate the next medical device, food product, or packaging improvement, Karp said.
“If I were starting a product, I’d find an expert in that field and convince them to be an advisor to me,” Karp said. “I’d network my way to somebody who believes in me, believes in my product, and can give me advice on the market. Then you’d want an experienced entrepreneur to talk to, because they will tell you the ropes on how to fundraise. An entrepreneur has to hit up all angles and find those experts.”
Sublett, of Bounce Innovation Hub, said there are few places outside of Northeast Ohio where she would want to kickstart a new company.
“There are incredible resource providers across the entire region,” Sublett said. “Organizations like Bounce and other regional groups can help with understanding cash flow and operating runway. We can also assist companies in pivoting to stay afloat and then how to take advantage of the economic shift expected later in the year. That said, economic uncertainty often leads to increased business starts and new innovations, so I’m optimistic about the talent in Northeast Ohio and its ability to develop and commercialize life-saving innovations and market-driven products.”