TALENT, DENSITY, AND CAPITAL ALL NEEDED FOR A BURGEONING STARTUP ECOSYSTEM
Between 2008 and 2012, the entrepreneurial stars began to align for Washington University and St. Louis alike.
“Before 2008, the school offered more to the community than the community offered to the school,” Holekamp says. “But in 2012, suddenly, there were enough people, enough density, enough activity that there was a community that could define its own culture and then attract people to join that culture.”
Both Holekamp and his successor at Washington University, Doug Villhard, say three things were needed for St. Louis’s entrepreneurial surge: talent, capital, and density. Talent has been in St. Louis for a while, Holekamp says. And there has been enough capital to support the talent. But density — or a community —lagged until 2012.
“The community was finally close enough and had enough shared experiences that they were able to create its own culture,” Holekamp says. “And then people started joining it.”
MORE OLIN STARTUPS STAYING IN ST. LOUIS REGION
Holekamp and Webber were instrumental in the creation of the community and culture. Holekamp was a key investor, having founded with Brian Matthews and Kyle Welborn, Cultivation Capital, one of the Midwest’s most active early-stage investment firms. Cultivation Capital joined Arch Grants, a nonprofit that invests $50,000 in early-stage St. Louis ventures and Capital Innovators to launch T-Rex. When they found their original coworking space in 2012, all three investment groups brought some of their portfolio companies, creating an immediate community.
“T-Rex started with about 50 companies in this coworking space,” Holekamp says. “Which now sounds really small, but at the time that was enough to create those community bonds.”
Before 2012, 51% of graduates from Olin’s capstone entrepreneurship course kept their companies in St. Louis. After 2012, 91% of those graduates started staying in St. Louis. All a sudden, “It was advantageous to be in this community. And in this entrepreneurship community, being a WashU graduate makes you a rockstar,” Holekamp says. “We’ve created a place for our students to land.”
OLIN’S PROGRAM BENEFITTING FROM COMMUNITY
The bolstered entrepreneurial community has also improved the value of Olin and Washington University’s programming. “We need the startups in town in order to run our programs efficiently,” Villhard says. The curriculum is highly experiential in nature, and having thriving startups for students to intern at and work with on class projects has been a boon for the program.
“Suddenly, it wasn’t the case anymore that we were giving to the community like it was a charitable endeavor,” Holekamp says more bluntly. “We greatly benefited from being in the community.”
And so the growing snowball of entrepreneurial momentum between Washington University and St. Louis continues to gain momentum.
ATTRACTING STUDENTS FROM ACROSS THE COUNTRY FOR ENTREPRENEURSHIP
That growth has begun to attract students from across the country, including Derek Leiter, who just entered his first year in the full-time MBA program at Olin. A New England native, Leiter jokes that “if you were a valedictorian at a Connecticut high school, WashU was your choice.”
Entrepreneurship was always going to be the path for Leiter, who outsourced labor for his lemonade stand as an eight-year-old. “I hired neighborhood kids to expand my lemonade stand,” Leiter says. After his corner in the neighborhood started getting stale, he first hired his younger brother to hold the sign for a 20% to 30% cut of the profits. Then he started recruiting kids in cul-de-sacs to open stands in more trafficked areas, again, for a cut of the profits. Leiter then expanded his product line. “We noticed people started getting tired of just lemonade so we started selling novelty items like candy cigarettes, and stuff that people used to love when they were younger,” he laughs.
After a hodge-podge early career that included stops at Ernst & Young, a tech startup in San Francisco and a brokerage firm, Leiter decided it was time to earn his MBA.
“I knew I wanted to go somewhere where I could bring my patents to work on my products,” Leiter says. “I wanted to do entrepreneurship in a place that was growing, not a place that was saturated.”
And in St. Louis and at Washington University, he’s done just that.
“Since coming to this center, I’ve been able to find engineering students that are helping me with 3D printing. I’ve been able to find professors who have backgrounds in what I’m doing, research-wise,” Leiter says.
“A lot of schools will say that entrepreneurship is something they enjoy or they really push you to do, but at Olin, the entrepreneurial mindset is one of the main four pillars. You pretty much have to walk through the day with your eyes closed and your fingers in your ears to not see or hear something about entrepreneurship.”