Wednesday, September 26th, 2012

Founder Mobility

Kate Maxwell and Sam Arbesman at the Kauffman Foundation are out with a new study the measures the mobility of founders of high growth companies (those on the Inc. 500 list). Using network mapping software, they took a few cuts at determining mobility groupings, and here was an interesting graphic that popped out. The colors on the map are basically communities as defined by migration between the components:

This is an interesting study. I suggest at least checking out Richard Florida’s review of it over at Atlantic Cities.

14 Comments
Topics: Demographic Analysis, Economic Development

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14 Responses to “Founder Mobility”

  1. Matthew Hall says:

    The Cincinnati MSA is the only metro in the country not indicated on this map. I wonder what that might mean.

  2. George M says:

    Matt, it looks like Cinci is a very light lavender that barely shows up, but it’s there.

  3. George M says:

    On a related topic, I have often wondered about entrepreneurs that found business locally, grow them to a certain size and then sell them. I have seen this happen numerous times in Columbus. Equity firms or larger corporations come in from other areas, often the coasts, and scoop up growing companies. Then they’re gone.

    I think this is a crucial aspect of economic development and business growth that’s all to often overlooked.

  4. Matthew Hall says:

    Does that mean Cincinnati’s strongest entrepreneur connects are with Ft. Collins, CO. and New Hamphsire? How odd. Does Florida mean to suggest that Cincinnati founders don’t leave for many other places?

    Yes, George, that is THE problem for Columbus; it’s so transient. Cincinnati and Columbus couldn’t be more different in this respect. Columbus needs to build clusters of expertise in certain areas to keep its start-ups instead of depending on branch plant/back office operations looking for low costs alone. Cincinnati has machine tools/ manufacturing systems, chemicals/pharma, branding/marketing, and logistics. There is a real reason for companies in these areas to be in Cincinnati.

  5. George M says:

    Matt, Columbus is kind of on the bubble in some ways. It is somewhat transient, and has its share of low-cost-seeking jobs (call centers, etc.). It also has several mini-clusters. Government and education are obvious ones, but banking and insurance is fairly big, as is restaurant/retail HQs, and logistics has been growing at quite a clip. There are a good number of tech and medical jobs here, but not in any one cluster. There are no one or two dominant clusters, whcisi good and bad.

    I actually think that design could be a good cluster for Columbus. We have Ohio State and the Columbus College of Art and Design, which both have very good design programs, plus several well-established design firms already serving the retail HQs in the area. I was just reading an article the other day about how there are a few hundred Columbus-area graduates working in the digital movie companies in L.A. (Pixar, Dreamworks, etc). This is another example of a place where we could grow a cluster.

  6. Matthew Hall says:

    Eds and Meds (and govn’t) are their own world and bricks and morter retail is declining everywhere. All those OSU grads certainly are appealing to employers, but as you describe they leave for work elsewhere. I’ve often wondered why OSU hasn’t been the souce of a creative class economy in Columbus as research universities are in Austin, Raleigh, and Pittsburgh.

  7. costanza says:

    Matt, you answered your own question.

    “they leave for work elsewhere”

  8. Matthew Hall says:

    But why do they go to other young, smallish metro’s with research universities instead of staying in the one their in? I always ask the OSU students I meet about their plans after school and they NEVER include Columbus. I’ve never understood why. Is the grass just always greener elsewhere?

  9. costanza says:

    I don’t know the answer, you should ask. It may be because Columbus is a rather sterile place.

  10. George M says:

    Actually, just about everyone you meet here has gone to Ohio State. Remember, the institution graduates nearly 55,000 students every 4 years. If they all stayed, Columbus would probably have the highest percentage population increase in the nation. A lot of them do stay-and a lot of them leave too. That’s not a bad thing.

    I came to OSU and stayed. I’m from the northeast. I admit, my first impression of the place was less than favorable. It doesn’t wow you at first glance. But I grew to love it. It’s not for everyone, and I don’t expect everyone to stay. But the longer you’re here, the more you realize this place has a real cultural depth to it. I meet more people that say, “I never planned on staying, but…”

    Finally, yes, we have a lot of brick-and-mortar retailers, as you say. However, they are some of the most successful retailers in the industry, and they’re pioneering the use of the internet to boost sales. Look at Limmited Brands. Their use of internet sales, including marketing, like the Victoria Secret Fashion Show and supply fulfillment helped pioneer the online retailing industry.

    Aaron himself has noted that many cities have expertise in areas that they don’t even realize. I think Columbus’ retailing expertise could be parlayed into an anchor industry in design. We already have a couple of internationally recognized retail design firms here, two excellent design schools (at OSU and Columbus College of Art and Design) and many smaller companies.

  11. George M says:

    BTW, I think that the issue of small growing companies being bought out and moved by big multinationals or equity firms is NOT just a Columbus problem. I imagine that the exact same thing happens in most Midwest cities. A lot of the money comes in from New York (hedge funds, private equity) or San Francisco (venture capital).

    One of the issues in Ohio in general is the lack of an established infrastructure for growing tech companies. That’s why many of them are scooped up and move. VCs want their investments to be close by to observe and monitor. Plus much of the tech “ecosystem” is on the coasts, or in a few select cities like Austin or Raleigh/Durham. We have missed that wave.

    We need to find new areas where we can grow our own “ecosystems” that support specific industries. Beyond Detroit and auto, I can’t really think of one city in the Midwest that really stands out to me as having a true economic cluster to the point that it forms its own virtuous “ecosystem”.

  12. Matthew Hall says:

    I obviously meet different people than George.

  13. George M says:

    If you’re in Cinci, you probably met all the ones that left. I’m in Columbus so met all the ones that stayed. ;-)

  14. Matthew Hall says:

    I lived in Columbus for 4 years. Everyone I knew there socially or professionally had grown up elsewhere and none had graduated from OSU. None of those 20 or so people now live in Columbus, amazingly. Just my own experience,but it suggests that if there are lifelong columbusites they don’t interact with those who come from elsewhere and that there are a surprisingly large number who are just ‘passing through’ onto somewhere else.

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