Mar 2 2012

FinServe Tech Angels in St. Louis, MO

I’ve been getting lots of emails from readers of this blog and Feld Thoughts about my Startup Communities book effort with stories of their own. For now, I’m going to keep posting them (with permission of the authors) as I explore a way to open this site up so people can self-publish their own stories. In the mean time, please keep them coming – they are enormously helpful as I continue to work through both the book and my theory about how Startup Communities work. In addition, it’s great exposure for your startup community and some of the comment threads have been outstanding (please weigh in if you have thoughts and/or are doing similar things in your startup community.)

Today’s post is from Kyle Welborn, the founder and executive director of FinServe Tech Angels in St. Louis, MO.

I want to start by saying that I am not yet a leader in my city’s entrepreneurial community, but I am trying to be. I left a day job in September of last year to launch a new angel group in St. Louis, MO. In building this new angel group, I am trying to capitalize on St. Louis’ strengths. I think it is much harder and more expensive to build entrepreneurial capacity from scratch than it is to focus on an area where my community already has some domain expertise. In St. Louis, we have a large cluster of people who know the financial services industry. According to our chamber of commerce, 84,000 St. Louis residents work in the financial services sector. In fact, two of the three professional sports stadiums in the city are named after large financial services companies headquartered here, the Edward Jones Dome and the Scottrade Center.

My belief is that entrepreneurs ultimately decide where to locate their business based on three things: where do their customers live, where can they hire great talent, and where can they raise capital. No region has all three of those elements for every business industry out there. However, I believe St. Louis has the customers and talent necessary for financial services technology entrepreneurs to succeed. I decided to start building an industry focused angel group to fill in the missing capital void for these start-ups. It is way too early to know if this idea will work or not. My group is only up to 10 members, and to date, we have not yet made an investment. However, I have gotten people to join, built a Board of Directors, and we are in due diligence on several companies.
There are several other cities trying to improve the start-up eco-system by focusing on their strengths as well. Cincinnati is leveraging Proctor and Gamble in running an accelerator program called the Brandery specifically focused on consumer products companies. Rock Island, Illinois is tapping into John Deere to help their entrepreneurs find new uses for old patents. Not every city is going to be Silicon Valley or Boulder. However, every community has something that its city’s big corporations are good at, and focusing on these strengths seems like the right way to start building a successful start-up community.