Leaders Shine Light on Strengths, Shortcomings of St. Louis Startup Community
Cathy Goldsticker, Tax Partner and Startup Practice Leader at Brown Smith Wallace, moderated the panel, which included Scott Bernstein, principal at Lewis & Clark Ventures; David Dresner, founder of Sleeve a Message; Ginger Imster, vice president of Innovation and Entrepreneurship for the St. Louis Economic Development Partnership; Jerry Schlichter, founder and managing partner of Schlichter Bogard and Denton and founder and chairman of Arch Grants; and Dr. Cheryl Watkins-Moore, director of bioscience and entrepreneurial inclusion at BioSTL.
The group provided perspectives on the findings from the second St. Louis startup community survey conducted by Brown Smith Wallace.
Funding remains top of mind
For the second year, startup and startup support community survey respondents (investors, educators, accelerators, incubators, consultants and others) said the number one way the St. Louis startup community can be strengthened or enhanced is by having more local funding.
In order to incentivize our funding organizations to invest solely or primarily in the St. Louis region “you have to show opportunity here,” said Bernstein. “Nobody is going to invest if their risk/reward profile is weaker here than the other opportunities in their pipeline.”
Schlichter echoed that sentiment. “If there is enough buzz created, it would bring money off the sidelines,” he said. “At the end of the day, we need success and home runs. In turn, those entrepreneurs who are successful reinvest in new funds or companies.”
Funding means different things to different startups – seed funding, bank loans, angel investments and Series A & B funding were just some of the avenues discussed by the panelists.
“We need to have parallel paths for both venture capital backable type investments and the bootstrap entrepreneur,” said Imster. “There are tools, if people know how to access them and where to go, to de-risk a bootstrapper so that he or she becomes a more likely candidate to receive a loan.”
[caption id="attachment_30545" align="alignright" width="232"] Click here to download a copy of our 2017 St. Louis Startup Survey Report.[/caption]
An agile team is key to startup’s success
As for what makes a startup a good investment, panelists discussed the importance of a strong value proposition and product differentiation, and many echoed one of the primary answers given by survey respondents – the team.
“You might be the technical expert, but you need to make sure the team you have is going to be a strong team. That’s what makes it an attractive proposition,” said Watkins-Moore.
Bernstein added, “You need to find a team that is resilient and agile, and understands that the product that you launch with may not be the product that you succeed with.”
When determining a startup’s success, survey respondents cited execution as the number one factor.
“It’s about being agile in the beginning, continuously improving, changing quickly and pivoting,” said Dresner.
Diversity in innovation community can be ‘catalyst for change’
In discussing what the St. Louis startup community can do to continue to improve the support of woman-owned or minority-owned startups, Imster discussed how the entrepreneurial community can set the tone for the region.
“I think we are struggling as a community to figure out how to institutionalize tolerance and equity. The innovation community has an opportunity to lead by example in that regard. All of us in this community need to begin to realize that we are catalysts for change when we communicate in a way that builds coalitions around a common good versus further polarizing ourselves.”
There are many opportunities for improvement as well as growth in the years to come according to the panelists.
“I would like to see better engagement from our corporate communities. Increasing connectivity between them and our early-stage innovation ecosystem would be incredibly impactful,” said Bernstein.
“I think St. Louis should be marketing the city (to large corporations) as your R&D playground,” said Watkins-Moore. “This is where companies can come to really look at creating new technologies.”
Click here to download a copy of the full report, “Taking the Pulse of the Startup Community: Funding, Diversity and Region’s Image Weigh on Respondents’ Minds."