Here in Philadelphia our startup scene has recently entered adolescence (hat tip to Alex Hillman for that analogy). We have pimples, our voice is changing, and our emotions are all over the place. Ultimately, it’s a good thing…we are growing up and getting bigger! You can measure it lots of ways, but whether its a bootstrapped startup or a venture backed one, there are more of them getting past MVP, past product market fit, into growth mode, than we have seen in a long time (definitely since 2000, when I started my first company here). There are more true early stage funds in Philly than ever before, more great co-working spaces, more events to learn and connect with your fellow community, and more smart people graduating from our schools and staying. We have a city government that understands and puts real energy into making this a city where a startup can launch and grow.
I tend to believe that many of the criticisms directed at Philly are not actually unique to Philly, they are just challenges that all startups face. Yes we have talent challenges, but every city does. Ask any startup in San Francisco if its hard to find and retain good talent and they will say it is one of their top 3 challenges. Yes it is hard to raise money in Philly, but ask any first time founder in any city if it is hard to raise money and they tell you it has never been more competitive of a market. Philly based investors are too risk averse? Then go pitch VC’s in other markets. There are more externally funded companies in Philly than there ever have been. Use the fact that you are based in Philly as an advantage because you can attract very smart people to your startup, and they tend to stay much longer than other more competitive markets. I believe it is an advantage to start a company in Philadelphia so much that I chose this region to start my second company here as well.
Like many adolescent phases of growth, it’s a critical time for us, because we are still fragile. Startups will fail; maybe mine, maybe yours, but statistically speaking it is inevitable that companies starting up and growing today wont be around next year. And if/when we have our next market correction, companies that may have otherwise made it will be forced to shut down too. And when that happens we can either run into our caves of safety and shout “see! I told you startups were risky!” or we can keep on rolling. Do another startup. Fund a seed round. Join a company pre-revenue. It’s impossible to know which path we will take, but if we take the latter, it’s a good indicator that Philadelphia will be an enduring hub for startups to grow and thrive.
So if you have ever wondered, “how can I help Philly succeed as a startup community?” Here are some ideas I would offer.
If you have started, plan to start, or work for a startup here, the absolute most important thing you can do is make that company successful, by whatever metrics you have defined for success. This sounds obvious, but if you had to boil down every successful startup community that ever existed to one trait they all had in common, it was that companies in that community grew and had successful outcomes. When non-local media writes about startup scenes, its only because the companies there become worthy of writing about.
If you or your company is the target of a local startups offering, try it out and offer them feedback if they want it. Tim Raybould wrote a great post on this subject. If its a fit for you, buy it/use it and be a reference customer. If its close, try to partner with the startup to make it a fit. If it is not close and a competitor has something genuinely better for your needs, then buy that, so long as you (1) give the Philly company a shot, and (2) give them candid feedback why you went with their competitor (if they want it). This is a tough one I know, but if you buy local and it is substantially inferior, its actually net negative for Philly, because now you are using a product that is unhelpful to (or negatively impacting) your business, and the startup is getting a false sense of success.
Genuinely root for a startup you know. When they announce something, help them share the news via social media and tell your friends about it.
Go to events, meet people here. I really don’t like small talk or “networking” in the traditional sense. But I go to events all the time. It works for me because the people I have met here I consider friends, so it doesn’t feel like networking any more. As you build those relationships, you will learn a ton along the way about yourself, your company, your challenges in getting your business to the next step, etc.
Experience other startup scenes, and share what you learn. Let it inspire your startup. There are exactly zero startup communities that got big by being closed….go ask around, they will happily share what worked for them. I have immense respect for the startup communities and relationships I have been fortunate to make in San Francisco, New York and Austin.
Maybe you tried a new way to get twitter followers and it worked. Awesome thing to share. Try mentoring a first time founder. Mentoring has shown to have a HUGE impact on startup success rate . (See below though, false mentoring can have a similarly devastating effect on a startup). And when you share a best practice, share it publicly if you can, not just locally. You get more visibility for your company (and ultimately Philly) that way! Ever read the Buffer blog? They are total pros at this and it drives a ton of traffic to their product. Here is a great example that was inspirational to Guru.
Right now you know the perfect customer for a startup in Philly. You also know the ideal product manager for someone local who is hiring, and you may even know a high net worth individual who likes to do angel investments. It is amazing once you wire your brain to look for these connection opportunities how they start to appear.
My favorite is when I hear “the next silicon valley”. Silicon? Even if the descriptor wasn’t way outdated, did you ever compare your significant other to a prior significant other you used to date? Yup, its pretty much the same outcome. Every place is different, so lets focus on what makes us unique, and stop trying to be like others.
Please. I beg you. It’s the last thing we need to be talking about right now. When people talk about the tech scene in “Silicon Valley” do they exclude salesforce.com, Twitter, and Slack because they are headquartered in the city of San Francisco? Nope, they don’t. SAP is part of Philadelphia’s tech scene. So is DuckDuckGo, Zonoff, Clutch, LeadID, GSI Commerce (eBay), Kenexa (IBM), Boomi (Dell), and those are just a few examples. We are one region and need to take full advantage of what we have to offer in the aggregate.
“That will never work! Ha!” Yes, 75% of startups fail, captain obvious. The next time you have the urge, instead try to predict something that will succeed. You call that right, you just became The Startup Prophet and can update your various social media handles accordingly. Optimism is infectious.
Early stage startups may seek you out for advice because of an experience they think you had. If you lived through something they are going through, at a similar stage they are at now, then offering advice is terrific. Otherwise, the best thing you can do for that startup is say “I don’t know, but XYZ may, let me intro you.”
There has never been a better time to start a company in Philadelphia. And it keeps getting better.