St. Louis was #2 in the nation for fastest growing rate of new startups in a metropolitan area. St. Louis had 4,876 new start-ups in 2014. In a survey of entrepreneurs, the Census Bureau found that 30% of new businesses in Missouri are in health care. Additionally, women own a larger number of startups in Missouri than in any other state.
And guess what? People are surprised. When you think of entrepreneurs, St. Louis does not come to mind. St. Louis is known as a home to large companies. And yet, the national startup rate was down for the second straight year by 8%, where St. Louis saw a 9.7% increase. And Missouri, for the first time, made the top 10 cut in Forbes list of states for startup funding.
Entrepreneurial activity, especially small, startup businesses, creates the most new jobs. In the mid-2000s, large corporations began leaving St. Louis, and with them, jobs. Leaders and institutions went to work. They created a new “ecosystem” to support startup businesses. Washington University was involved in every step, including founding the Skandalaris Center and providing funding to start BioGenerator and Cortex. A Kauffman study reports these three institutions and others have created the foundation for St. Louis’ startup success.
An example of that success is the Arch Grants organization. In 2014 the group awarded 20 grants to startup businesses in St. Louis for a total of 1 million. One year later, the 20 recipients had already created 104 jobs, generated more than $2.8 million in revenue and raised $17 million in investment.
By changing the ecosystem that supports start up business, St. Louis has, to steal a phrase, hit it out of the ballpark.