Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist, 2nd Edition

Excerpt from Startup Communities

CHAPTER THREE

PRINCIPLES OF A VIBRANT STARTUP COMMUNITY

Now that you've had an introduction to Boulder and its history from my point of view, I'd like to describe the principles that drive the Boulder startup community which I'll call the Boulder Thesis. First, however, I'll discuss the three historical frameworks that have been used to describe why some cities become vibrant startup communities.

HISTORICAL FRAMEWORKS

The investigation into startup communities is among the most important inquiries of our time. Why do some places flourish with innovation while others wither? What are the determinants that help a startup community achieve critical startup mass? Once under way, how does a startup community sustain and expand entrepreneurship? Why do startup communities persist, despite often having higher real estate costs and wages than other areas? At stake is nothing less than the continued economic vitality, and even the very existence of towns, cities, and regions.

Studies show that the geography of innovation is neither democratic nor flat. This may be surprising since you might think that location should matter less than ever in today's society. Information can be quickly sent and received by anyone from almost anywhere. In theory, expanding access to resources and information from anywhere might decouple the relationship between place and innovation.

Economic geographers, however, observe the opposite effect. Evidence suggests that location, ...