Boise is poised for a new era of entrepreneurship.
There’s a lot left to do, but pieces are falling into place that can turn the city back into a breeding ground for new business.
Local businesspeople are building networks that help each other find the best paths — and avoid the worst ones — to establishing profitable ventures.
Local government is assuming its proper role in support of businesses.
The university is listening to private sector concerns about the skills of its graduates.
Those three principles received short shrift for much of the past decade, some local entrepreneurs say, but they’re being observed now.
“It’s a long-term, systemic change that needs to happen, rather than a quick fix,” said Pete Gombert, founder of Balihoo.
BOISE’S BACKSLIDE
There was a time when people with big ideas — and personalities to match — defined Boise. People like J.R. Simplot, Harry Morrison and Joe Albertson turned their ideas into visions. Their businesses reaped wealth and the Treasure Valley benefited from the jobs, cashflow and charitable giving.
In some ways, Boise became a victim of its own success, said Bob Lokken, founder and CEO of White Cloud Analytics.
The legends’ empires provided comfortable livings for thousands of employees. But comfort is no friend to innovation. For too long, complacent Boiseans rode their forerunners’ gravy train, and the pipeline of restless talent dried up, Lokken said.
“The work-hard muscles tend to atrophy when things are going well,” he said. “We just kind of assumed that there were going to be big corporations around here with really high-paying jobs and (would be) creating a good standard of living and a great little community, and we just kind of assumed that was always going to be the way it was.”
In leaning on its pioneers, Lokken said, Boise and the rest of the Treasure Valley slipped away from what made those pioneers successful.
THE PATH BACK
When author Brad Feld spoke to the Idaho Technology Council in October, he got some Boise leaders’ attention. The most important principle in his speech and his book “Startup Communities” is this: The people who start companies must drive innovation and entrepreneurship in their communities. They can’t wait or rely on government or other institutions, such as universities, to lead; those institutions need to follow and help.
That doesn’t always happen in Boise, said Ryan Woodings, who in 2005 founded MetaGeek, a Boise company that develops solutions to problems with wireless networks.
Too often, Woodings said, Boise’s entrepreneurs wait instead for government, Boise State or some other group to shape the city’s business opportunities.
“We’re looking at some organization to kind of lead,” Woodings said. “I feel like we need, just citizens, those people that are here in the community that maybe have sold a company and now have some time. We need those people that have experience and some time to step up and lead.”
Governments are particularly ill-equipped to lead development of a successful startup community, Feld argues. Partly, that’s because government is full of people who are focused on elections every few years.
“They always have a timeframe that is too short,” Feld told the Statesman. “They also end up allocating tax dollars poorly, either as incentives that have unintended negative consequences or are simply bad investments, or where the actual management and bureaucracy results in inefficient or poor capital allocation.”
ASSIST, SUPPORT AND GET OUT OF THE WAY
Boise’s wealth of government and educational institutions should play a role in helping new companies start up and keep going, Feld said. They should provide space for meetings and conferences that bring entrepreneurs together to share ideas. They should craft systems of regulations that encourage new companies — and the jobs that follow.
That’s what Boise is trying to do now, said Cece Gassner, Boise’s assistant to the mayor for economic development. In addition to sponsoring entrepreneurial events, the city supports groups and activities aimed, at least in part, at helping private businesspeople succeed, Gassner said.
Examples include Kickstand, IdaVation and TechBoise, organizations that encourage local entrepreneurs to meet and discuss the obstacles and opportunities they face. Ignite Boise is a series of five-minute presentations on business, art, technology, government and academia.
Boise State sponsors the TECenter, a technology incubator/accelerator in Nampa offering 30,000 square feet of rentable space where young businesses can operate.
But institutions can only prepare the path.
“Unless we actually hire somebody at the city, we’re not creating jobs. That is the private sector’s job,” Gassner said. “We want to make sure that we just have a great city for people to work with and play in, and then let the business go.”
Some institutions have unintentionally made entrepreneurship more difficult in Boise, said Anthony Lyons, executive director of Capital City Development Corporation. That includes Lyons’ own organization, whose mission as Boise’s urban renewal agency is to encourage economic growth, not stifle it.
Until October, the agency reviewed and recommended details for projects proposed within its urban renewal districts. Lyons said that was an unnecessary layer of regulation. Removing that step will make it easier for new projects, maybe even new companies, to take root, he said.
Lokken credited Lyons with doing exactly what Feld said governments don’t do enough: ask business leaders what he can do to help them.
IT’S THE PEOPLE, STUPID
What Boise startups really need is a bigger workforce.
Entrepreneurs, government officials and educators agree the city’s best path to becoming a thriving startup community is through software companies. Boise just doesn’t boast a surplus of software designers, constraining the growth of the city’s tech sector.
“There’s a whole number of businesses that have tried to start up in this Valley over the last 10 years that have either started here and moved, or they just flat couldn’t find the people to get started here,” Lokken said.
The problem, he said, is that Idaho’s education system is still shaped to meet the needs of agriculture, the state’s traditional economic driver. Information technology’s role in the economy has grown rapidly, and the education system has been slow to adapt, Lokken said.
“I need an educated workforce. That starts up in the pipeline. That’s not like a six-week training program,” he said. “Yeah, we can talk about the tax policies or investment incentives that would encourage startups and encourage collaboration. I think those things are probably important, but they all pale in comparison and they’re quite frankly fruitless if we don’t have a steady pipeline of highly educated, highly skilled employees entering the workforce. It all goes for naught.”
INVESTING IN COMPUTER SCIENCE
That workforce problem is one that Boise, above all other Idaho cities, has the resources to solve, said Mark Solon, managing partner of Highway 12 Ventures, a company that invests in Intermountain West startups.
Boise State should fund computer science programs “to a very high level,” Solon said, with a goal of increasing the number of graduates by “an order of magnitude.”
The university is moving in that direction, said Harold Blackman, interim chairman of the computer science department. Thanks to extra money from the state’s Idaho Global Entrepreneurial Mission, Blackman said, the department is adding four new members to its eight-person faculty.
Between now and mid-2015, IGEM is projected to contribute $2.1 million, as well as about $1.8 million in matching money from the university, to the computer science department. Blackman said the goal is threefold: encourage more students to enroll in the computer science program; retain students who start out in computer science; and conduct more research at the university.
Ultimately, he said, the university wants a department to rival the University of Washington and other larger institutions for research opportunities and number of graduates and faculty. Boise State now graduates about 25 computer science majors a year. Blackman wants that number to grow to about 150 — a transformation that will take time but reap long-echoing benefits in the state’s economy.
“Computer science is a big deal and so by producing additional graduates, by doing more research here at the university, we’re going to help fuel the startup companies in computer science, and really help them be successful, and hopefully grow and add more,” he said.
TWO-EDGED SWORD
In his former life working for a major software company, Woodings often made business trips to California’s Silicon Valley, where he saw a richer supply of software workers.
“People down there are willing to take a little more risk. Maybe they’re younger,” he said. “Here in Boise, they’re sort of here for life. They’re family people. They want a good, stable job.”
So it’s harder to fill openings. But there’s a good side: People who do come to Boise want to make it their home.
“And so all we have to do is have the draw to get them here,” Gombert said, “and then they’re going to stay and they’re going to start companies, and some of those will fail and some of them, hopefully, will be wildly successful.”
YOU CAN LEAD A HORSE TO WATER ...
Ultimately, the responsibility for making Boise a successful startup community lies with its entrepreneurs. Whatever support the city’s government and education institutions give is meaningless if businesspeople don’t do their part.
Doing their part means sharing, not hoarding, information — another key Feld concept. Veterans of the startup game can give rookies know-how on everything from what kind of corporate structure they should establish to how to penetrate markets and where to distribute advertising dollars.
Woodings said most established businesspeople in Boise are willing to share time and advice with new entrepreneurs.
“I’m not asking them for anything more than, ‘Hey, I’ll buy you lunch and you tell me what you think.’ A lot of people in Boise are pretty open to that,” he said.
But the newcomers don’t take advantage of the opportunity often enough. And there’s no mechanism to make sure they even know the opportunity exists.
In fact, Woodings said, there’s a disappointing lack of buzz about everything entrepreneurs are accomplishing here.
“We don’t have that voice that’s saying, ‘Hey, look what I just did,’ or ‘Look at this cool company over here,’” he said. “There’s quite a few cool companies that you just don’t hear about ever.”
Woodings said he goes to periodic networking sessions with other Treasure Valley entrepreneurs, including Kickstand and Software Alliance, a group that discusses ways to recruit more software engineers and how to keep Boise State students enrolled in computer science programs.
Another group, the Tech Boise Coffee Club, met informally every month in Downtown Boise, but has fizzled out.
Woodings’ own life offers an example of the forces he worries about.
“We have a toddler at home. It’s kind of hard to go to evening meetings, that kind of stuff,” he said.
‘THE NEXT BOISE’
Though he criticized the way Boise’s governments, educational institutions and entrepreneurs developed business opportunity in the past, Lokken said he’s now seeing “a lot of movement in the right direction.”
Feld writes that Boulder, Colo., where he lives, transformed itself into a hive of entrepreneurial activity by doing the things Lokken sees happening here: business leaders networking, governments and educational institutions supporting them, and information flowing freely among all nodes.
The big question is whether that momentum will continue in Boise.
“It’s not like I think we’re going to fail, but it’s a lot of work. The system doesn’t really like to change. It doesn’t like to adapt. It’ll probably fight you every step of the way because people don’t like change,” Lokken said. “I’m optimistic we will meet the challenge, but I wouldn’t say I’m confident because it’s a lot of work and I still don’t see a lot of people recognizing the urgency or the scope of the problem we’re talking about here.”
Solon looks at the other side of the coin. A rebirth of entrepreneurship is already under way, he said, with more interesting startups today than at any time since 2000.
Lyons and Gassner said Boise can learn from other cities that have made themselves friendly to startups, including Feld’s Boulder. But copying those cities isn’t necessarily a recipe for success here. Boise has a unique set of assets and obstacles, and its approach to fostering a startup community must be tailored to them.
“Whatever else is done in Boulder or everywhere else, this community needs to be the next Boise, not the next Boulder,” Lyons said.
Sven Berg: 377-6275
