JumpStart: IdeaExchange Blog

During this week, Americans are considering those things for which they are thankful, and I am no exception. But while this is often a reflective, quiet exercise, I have the opposite reaction when I consider JumpStart progress; I find it incredibly energizing and exciting. Did you know…

• Last week marked the sixth anniversary of our community’s leaders determining JumpStart was necessary and taking the first organizing actions. Without their vision and maybe more importantly, their commitment to action, there would be thousands of entrepreneurs whose ideas might not have been as successful, or who might be living somewhere else.
• JumpStart was a proud sponsor of this past weekend’s “Cleveland Startup Weekend“, a 54-hour event to bring together people who want to start a high tech business. There have been Startup Weekends around the world (including Boston, Paris and Israel) but ours rocketed to the top. Northeast Ohio’s session sold out, even with more tickets added, and had the highest number of sponsors of any city in the world. As Clint Nelsen, the Seattle Partner of Startup Weekend said, “The event in Cleveland embodied everything we stand for! We were literally writing code on a boat next to a WWII submarine, two blocks from the Rock & Roll Hall of Fame, building new ideas and launching new startups.” Who knew, six years ago, we’d be setting the bar for the world in entrepreneurial energy.
• JumpStart Ventures companies continue to hit key milestones. In less than four weeks, three JumpStart Ventures portfolio companies - BSKLive, Neuros Medical, and MAR Systems - raised nearly $5 million in follow-on funding collectively. This is in addition to the global recognition two companies received in BusinessWeek. Once again, the region’s companies are competing and winning investment dollars and global recognition.
• This region has also been recognized as a national leader by The Initiative for a Competitive Inner City, and The Marathon Club. Both these organizations decided to work with us — in our region — to host next week’s early-stage capital summit focused on increasing access to capital for minority and female business owners.

Enjoy your time this week with your family and friends, and take just a minute to relax. We deserve it.

Ray Leach is CEO of JumpStart and brings his energy and leadership experiences from founding five high growth entrepreneurial and intrapreneurial endeavors in the last 20 years. Ray is a Sloan Fellow and earned an MBA from the MIT Sloan School of Management. He also earned a BA in Finance from the University of Akron.

I just vacationed on the north shore of Lake Erie and returned to work yesterday to find three reports in my email inbox that made for an upbeat morning, which I needed (read on, and you’ll learn why). 

First, Youngstown is on the cover of Entrepreneur Magazine’s August issue as one of the Top 10 best cities for entrepreneurs. Jim Cossler, head of the Youngstown Business Incubator, and Turning Technologies (ranked as one of the fastest growing software companies in the country), are two key reasons for the ranking. Jim is the evangelist of all evangelists. We tried to recruit him here when JumpStart was first formed, but he loved his job too much to do anything else, and we had to respect that. He knows the strengths of the tech corridor that Youngstown, at the mid-point between Pittsburgh and Cleveland, represents, and he builds on those strengths with a focus and relentlessness that is fun to watch. Congrats to the Youngstown entrepreneurial and tech community on this win!

Second, Cleveland-Elyria-Mentor is listed as the 15th city in Forbes Magazine’s recent “America’s 100 Best Cheap Cities” list, which includes the subtitle “Get more for less in these bargain boomtowns”. What’s more, the magazine lists nine more Ohio cities, giving Ohio ten cities that are in the top 100. From what I can tell, no other state has more cities that qualify as “boomtowns where you can get more for less”. These cities are Cleveland, Columbus, Cincinnati, Akron, Dayton, Toledo, Youngstown, Canton, Mansfield, and Lima. Of course I recognize, as does the magazine itself, that cheap cities may very well be cheap because unemployment is high or some other structural/economic factor is sub-optimal. However, the magazine also says that it is seeing the technology industry shift towards these lower cost cities and that this is “all part of a larger shift with tech that you’re going to see in the U.S.” At JumpStart, we live our lives every day working towards this, so we live and breathe this emerging reality; it’s great to see others beginning to recognize it. 

Third, the Pew Charitable Trusts’ recent Clean Energy Economy report ranks Ohio in the top 5 states in the country for number of jobs in the Clean Energy Economy. The Clean Energy Economy is a huge part of forecasted job growth over the next five to ten years and longer, and so to be a Top 5 state bodes well. Combined with Northeast Ohio’s already recognized healthcare strengths, we may well be positioned for a good decade (maybe even a great one?). The report highlights Axentis, right here in Cleveland, as a company whose software monitors greenhouse gas emissions. One of our Venture Partners, Ted Frank, was co-founder and President of Axentis, and its Chairman (and co-founder), Steve Lindseth, is one of our favorite regular speakers on the topic of growing a company and raising capital. Congrats to them for being highlighted.

Now back to why I needed to have an upbeat morning…During vacation I was supposed to be reading about the 21 irrefutable laws of leadership, but instead I got engrossed in In Cold Blood by Truman Capote. Now I return to work this morning no better a leader and all scared-like and depressed to boot (have you read In Cold Blood?). I would like to take this opportunity to reframe my wayward vacation ways, however. You see, rather than just reading about leadership, I like to believe I was actually practicing it: while I was away not reading what I was supposed to be reading, Youngstown became tops, Cleveland became a boomtown, and Ohio became a Cleantech mecca! Now that’s some serious leaderly delegating, eh? :-) 

Becca Braun is President of JumpStart Ventures. She founded and led a number of early-stage companies and organizations, as well as worked as a private equity investor and management consultant. She received her MBA from Harvard Business School and her BA in Linguistics from Harvard University. She is keenly interested in the intersection of wealth creation and broad-based regional economic growth.

Yes, recessions can happen anywhere - even in Silicon Valley.

Now is the time for Northeast Ohio to begin to catch up to places such as San Jose. Can you imagine what would happen if startup companies that JumpStart sees everyday could get access to some of the “Obama Stimulus” or “Medical Mart” monies?!

Overnight, Cuyahoga County would become a pre-seed company sensation. At least 50 new companies could access seed funding each year. These companies would raise at least $1B in private sector investments by 2020. Cleveland would be “on the map” for entrepreneurs from all over the world overnight!

Now it is true that this approach would not require a lot of construction jobs - and we would not need new hotels in town in the next few years to handle all of the VC’s and investors that would be flooding into our community - but I think in the long run it could very well make a larger difference because it would allow our community to make hundreds and hundreds of “bets” on our own citizens and the ideas that they have to help grow our economy and provide opportunities to our citizens.

Perhaps the opportunity to access Medical Mart-type monies may have passed, but Obama’s stimulus program could also do many of the same things. What better state and region to support with such initiatives than Northeast Ohio and Greater Cleveland given that our region needs this kind of shot in the arm more than any other region/state in the U.S.

With all of the money being prepared to “stimulate our economy” using untried programs that “might” work - we have business models in Northeast Ohio now which show that they can generate at least a 5x leverage on public-private sector investments within 4 years with a promise to hit 10x within 7 years.

While these initiatives might not have the political power or influence of other projects - they have the ability to deliver results. We need to leverage these models to make sure that we have a chance to come out of this downturn with an increased chance to be the Silicon Valley of 2050 - investing in hundreds of pre-seed opportunities is a way we can make this happen.

Ray Leach is CEO of JumpStart and brings his energy and leadership experiences from founding five high-growth entrepreneurial and intrapreneurial endeavors in the last 20 years. Ray is a Sloan Fellow and earned an MBA from the MIT Sloan School of Management. He also earned a BA in Finance from the University of Akron.