This story was originally published in the 2016 January/February issue of Chattanooga Magazine.
Chattanooga’s startup scene is bolstered not only by access to EPB’s unprecedented high-speed fiber network, but also by a growing entrepreneurial ecosystem that empowers startups to play a vital role in building a thriving “innovation economy” in the “Gig City.”
“Innovation economy” is a popular term these days, especially in cities like Chattanooga, Tennessee where the “Fastest Internet in the World” is lauded in national and international headlines and a growing entrepreneurial ecosystem provides a desirable environment for startups to build, launch, and scale their next bid ideas.
In 2008, Chattanooga began to emerge as a technology hub when the Electric Power Board (EPB) first launched its Smart Grid infrastructure for high-speed Internet. Simply launching a technology service like EPB’s one-gigabit-per-second fiber network is just one part of the success equation though. It is not until a city’s business, educational, and entrepreneurial communities tap into the power of the technology and set the practical application into motion, that the full potential is realized.
As Chattanooga’s unprecedented fiber network has captured the attention and imagination of the nation, entrepreneurs and tech startups have quickly followed. The success of companies like Open Table and Escadrille have broadened the horizons for other tech entrepreneurs to envision launching their Silicon Valley level endeavors in an affordable, accessible mid-sized city like Chattanooga.
From a Technology Hub to a Thriving Innovation Economy
The term “innovation economy” actually emerged long before today’s high-speed Internet and tech startups. It was during the 1940’s when the United States was entering its military industrial boom that the economist Joseph Schumpeter laid out his ideas on entrepreneurs and technology driving the nation’s economy.
Little did Schumpeter know that the entrepreneurs and technology of his day would pave the way for a completely different “innovation economy” with Internet companies like the Chattanooga-based online restaurant reservation application Open Table, which sold to The Priceline Group in 2014 to the tune of $2.6 billion.
Cycling clothier Escadrille is another local startup that has experienced impressive success with their launch in “Gig City.” Founded by Chattanooga native and cycling enthusiast Jordan Humble, Escadrille got its start during an entrepreneurship contest he entered while still a student at the University of Tennessee at Knoxville (UTK). With a $10,000 prize in hand, Humble had the seed money he needed to launch his dream, a high-end clothing line for cyclists, including a new Event fabric which is waterproof and uniquely breathable with fine details like Merino wool and suede added for linings and trim.
When it came to choosing where he would base his office for Escadrille, Humble chose his hometown of Chattanooga because of its robust startup scene. Humble joined forces with Hamilton Brock who serves as Chief Operating Officer and they set up business in Hamilton County’s INCubator, which is operated by the Chattanooga Area Chamber of Commerce. During their first month in business, Escadrille drew in $60,000 in sales, and now their connections with cycling teams and other buyers are growing across the country.
“I feel like we are in the right spot now to really grow,” Humble shares. “It’s really all the little things that make a big difference for startups- it’s the people and the inspiring place here in Chattanooga’s startup scene. Everyone thrives off each other’s energy.”
Jordan Humble shares that throughout the experience launching his startup in Chattanooga, it was the investors that really made a difference more than any one entity. “There is a money-raising community here.” Humble says. “The investors really want to see the companies grow and be successful.”
Offering his advice to other startups preparing to launch in Chattanooga, Humble says. “Start with finding the right mentor. Networking with others in the startup scene and building relationships really make all the difference.”
Chattanooga’s Entrepreneurial Ecosystem Gains a New Level of National Attention for “Gig City”
While Chattanooga has gained numerous accolades for its high speed fiber network and all the possibilities it supports, the “Gig City” is also beginning to receive acclaim for its growing entrepreneurial ecosystem.
Chattanooga’s startup culture is the very thing that drew entrepreneur and Internet personality Gary Vaynerchuk and his team to Chattanooga for their newest Vaynermedia office location, which recently celebrated its opening during Startup Week Chattanooga 2015.
“We evaluated multiple markets to expand our footprint beyond the coastal markets we are in (New York City, San Francisco, and Los Angeles), and when we had the opportunity to visit Chattanooga, the startup- friendly culture stood out to us,” says Mickey Cloud, vice president of VaynerMedia and head of the Chattanooga office.
“Chattanooga’s entrepreneurial DNA inspired us and it’s evident in everything from the public-private partnerships, the hustle exhibited by many of the founders and companies that are growing here, and, most importantly, in the optimism, encouragement, and collaboration that everyone displays. Our company’s culture meshes well with Chattanooga’s, and that drew us here,” Cloud says.
The “startup-friendly” culture that Cloud refers to can be traced back to the unique support infrastructure that Chattanooga business and tech leaders have been working to develop since the launch of EPB’s high-speed fiber network. With business incubator and accelerator programs like The Company Lab and Hamilton County’s INCubator, entrepreneurs can learn how to navigate through the somewhat chaotic startup process with the help of free or low-cost continuing education, mentoring, and creative space. Chattanooga startups also have access to a full line of developing local investors and angel funds that are committed to tech startups, women-owned businesses, and other specialty areas.
“Chattanooga has a passionate entrepreneurial ecosystem. From the founders to the venture capitalists and angel investors to the hustling employees where everyone is putting in the work,” Cloud says. “This story needs to be told on a larger stage- simply, we need more people to know what’s going on in Chattanooga. We need to raise awareness about the awesome environment that’s been created and to brand Chattanooga for the rest of the country and the world.”
Networking events and conferences like One Million Cups Chattanooga and the annual Startup Week Chattanooga offer entrepreneurs and startups the unique opportunity to connect with and learn from others in the “Gig City” as well as thought leaders committed to building an “innovation economy” in other cities across the country.
“Creating a density of entrepreneurially minded folks who can collaborate, share ideas, and get to work is imperative,” Cloud shares.
“Our team at VaynerMedia wants to be in the middle of that, connecting ideas, people, and opportunities. We want to be a pillar in the entrepreneurial foundation that’s in place and build value for the long-term for Chattanooga.”
Next Steps Lead the Way to an “Innovation Economy”
As Chattanooga takes the next steps beyond offering the “Fastest Internet in the World” to unleashing the fullest potential of the technology for entrepreneurs and startups, the “Gig City” is poised as a model for building an “innovation economy.”
With the early successes of Chattanooga startup ventures like Open Table and Escadrille and the endorsement of VaynerMedia in choosing “Gig City” for their newest office location , the stage is set for other entrepreneurs and tech startups to build , launch, and scale their next big ideas and make their “dent in the universe.”