BUS604: Innovation and Sustainability

Start-up ecosystems are emerging across the world in what is primarily an urban phenomenon. Fueled by technology-led cost reductions and increased access to resources, entrepreneurs are establishing start-up hubs in cities, developing new industries and jobs, disrupting traditional businesses, creating new communities, and impacting the urban economic and physical landscape.

The drive of start-up entrepreneurs provides an opportunity for positive impact on both the local economy and the urban landscape. Policy makers are increasingly focusing on these communities of entrepreneurs to leverage their drive and funnel it toward local industry and job creation as well as urban regeneration. What are the internal dynamics of these ecosystems and how can they be leveraged to increase their positive impact?

Previous research by the World Bank shows that tech start-up ecosystem components can be summarized in five categories: 

1. human capital, 
2. infrastructure, 
3. economic assets, 
4. enabling environment, and 
5. networking assets. 

The latter functions as the connectors of all the other elements and holds the ecosystem together by creating communities of entrepreneurs and like-minded individuals.

Table 1.1 Networking Assets

There  are  multiple  categories  of  networking  assets,  from  events  and  meetups  to  networks  of  mentors  and  rapid skills training programs (Table 1.1). Some of these networking assets (for example, coworking spaces, fab labs, accelerators, and so on) are integrated into physical spaces that also serve as platforms for other net-working assets, such as events, meetups, competitions, and trainings. These spaces provide an anchor for the entrepreneurs and support people to connect and form communities. In this report, these spaces are referred to as creative community spaces, physical spaces that enable innovation by creating a convening point for a community of entrepreneurs, start-ups, and otherwise like-minded people. Prime CCS examples include hubs, accelerators, coworking spaces, maker spaces, and fab labs. As the core of a networking asset, a CCS serves as one of the main influencers of the start-up ecosystem and enables various elements that cause the ecosystem to come together.

This publication showcases a variety of creative and innovative spaces that contribute to building a community that is sustainable and entrepreneurial and/or are helping advance an industry-specific or sectoral community. 

This account provides lessons and inspirations regarding the diversity and distinguishing factors that can be found among the plethora of creative spaces worldwide. Its purpose is to offer inspirational examples for policy makers whose goals are to support start-up ecosystems and, more generally, for those looking to similarly contribute to such a community by delineating the spectrum of services offered, the industry-specific connections that are bridged, and the skills that can be generated.

These anecdotes do not capture long-term impacts but instead reflect on spaces that have provided direct or indirect value to their communities. These spaces function across the spectrum of creativity and innovation - from focusing on incremental business process improvements to aiming for fundamental transformations of entrepreneurial communities in their cities. This cross-section of CCSs also speaks to different revenue and funding models, caters to various interests and industries, and upholds various networking assets and partnerships.

The CCSs showcased were each chosen for their role in either creating a new urban ecosystem or contributing to the existing ecosystem in a valuable way. They come from developed and emerging economies and cities of varying sizes, so the sample is not limited to a given region or economic performance index. They represent a variety of funding and revenue models and a diversity of services, which can be cross-analyzed to better understand how these factors enable the spaces to sustain themselves and be effective and impactful in spite of their settings. This sampling captures a selection of growing industries - from fashion to fishing, from food to robotics - and it highlights ways in which these spaces influence their given sector. Together, this catalog of spaces is intended to present insights to practitioners and policy makers and to reflect on the different models available for implementation around the world.

While the spaces featured in this report use different business models, they all are part of a movement that is bringing practical knowledge across and within industries. By drawing on the disciplines of open innovation and cross-sector collaboration, these CCSs are reducing the barriers to access of resources and markets for startups and enabling faster realization. Sector-specific CCSs have situated themselves in cities, and often in a particular area of a city that is well connected to other active spaces and entities that have a long history in driving traditional industry. For instance, New York has been a long-standing hub for medical research and life science companies as well as venture capital (VC) firms geared specifically toward biotech companies. Incubator spaces in this industry have been incentivized to establish themselves in this ecosystem given the connections the space could build and the innovations for which it could obtain support. 

In other instances, spaces have located themselves in new urban areas, ones that are undergoing industrial shifts; through their presence, these CCSs are creating new anchors for industries, such as the secondary anchor for the fashion industry of New York City growing in Brooklyn. These spaces are constantly restructuring in manufacturing, marketing, and new methods of tech innovation to respond to the rapidly evolving demands of the industry.

Sector-specific CCSs also often emerge in areas where there is a preexisting network established within a predominant sector. In Boston, for example, creative spaces specifically driving robotics have an advantage given the natural leadership and strengths Massachusetts has in this field overall. And by having sector-specific CCSs in rapidly evolving sectors such as robotics, Boston ensures that the city and surrounding area maintains this lead in the field, with start-ups building off of and benefiting from the presence of other institutions and large companies working on similar ideas.

Exclusion of any CCS from this report is not intended as a comment on the quality of their work or the impact they are achieving. This report's intent is to showcase inspiring examples and models being implemented in diverse environments across the world. The research has involved interviews with the founders of the spaces, survey sampling, site visits, and revision of their published material (Appendix A). 

This publication aims to catalyze a conversation about the role of creative spaces in urban ecosystem development.