Entrepreneurial Ecosystem

Background:

For years, the economy of Hampton Roads has been buffered by federal military spending during economic downturns. But what has been our single greatest strength is now becoming a drag on growth with the reduction in federal military spending.

Hampton Roads is dead last among the largest 100 metropolitan regions in the United States in recovering from the Great Recession. We have fewer jobs in Hampton Roads than we had prior 2007 and our density of high-tech start-ups is 80 percent of the national average and only 36 percent of the pace (measured on a per capita basis) at which high-tech startups in the Northern Virginia-D.C. area.

Regions that are growing faster than Hampton Roads, with higher wages, are those metropolitan areas that cultivate entrepreneurs and their start-up companies. The Kaufman Foundation has found that virtually all new net jobs generated in the United States from 1980 – 2005 (over 40 million) were created by firms that were five years old or less.

We simply do not have enough entrepreneurial and innovative talent to drive our region’s economic future. That sobering reality underscores the importance of diversifying our economy and fostering a new entrepreneurial ecosystem in Norfolk and the region, which was the catalyst for the creation of the GNC Entrepreneurial Ecosystem Task Force several years ago.

The Task Force, which was composed of a small, select group of thought leaders, focused on our entrepreneurial ecosystem here in Norfolk and developed a plan and strategies to build an entrepreneurial climate in Norfolk (and the region) that will jumpstart the development and growth of innovation based businesses and jobs.

 

Innovation Districts

A key recommendation is the development of an “innovation corridor” in Norfolk that roughly parallels a fully developed Elizabeth River Trail, linking key anchor institutions from Norfolk State to downtown (including TCC and the colony of technology companies on Granby Street), to the EVMS/Sentara/CHKD medical complex in the Fort Norfolk area, and onward to Old Dominion University (including its Innovation Research Park). If the economic-development potential along this corridor were realized, Norfolk could rival the job and income growth that cities such as Nashville, Chattanooga, Boston, St. Louis, Pittsburgh, Seattle, Durham, Albuquerque and Austin are enjoying from innovation districts that have emerged in their communities, benefiting all of their residents.

Norfolk’s opportunity lies in demography. Innovation Districts attract millennials, who are increasingly interested in authentic, transit-connected, mixed-use, bikeable, walkable and creative urban environments. They also want an “open-source” environment, where entrepreneurs and workers frequently collide to share knowledge between their various enterprises, whether in shared laboratories, co-working spaces or business accelerators. Entrepreneurs and workers who embrace a risk-taking culture benefit from being located near each other – researchers have documented the increase in innovation resulting from the so-called “proximity” or “knowledge-spillover” effect, leading to new products, new companies and new jobs.

Norfolk City Council officially designated the Norfolk Innovation Corridor as a “technology zone” in June of 2016, thus enabling the City to incentivize the growth of technology businesses with a multi-year BPOL tax exemption and abatement program. The newly designated corridor is being marketed as the Norfolk Tech Trail.

The Brookings Institution reportThe Rise of Innovation Districts” chronicles the growth, attributes and benefits of innovation districts.

 

Talent Development

Another key series of recommendations focus on developing, attracting and retaining talent, including a state-of-the art Career/Technical High School and a Governor’s School for Innovation & Entrepreneurship. These initiatives were endorsed by the Workforce Development Study Group chartered by the Hampton Roads Community Foundation as part of their Reinvent Hampton Roads initiative. (Reinvent Hampton Roads has been subsequently spun off as a separate entity.)

 

Place-Based Strategy / Elizabeth River Trail

Another key recommendation involves the embracement of a place-based strategy, which is critical if we want Norfolk (and the region) to be the type of place that attracts and retains talent. A key element of the plan being implemented calls for taking the Elizabeth River Trail to a new level and making it the most iconic riverfront trail in America and a magnet for attracting and retaining talent. A prototype design has been developed, including amenities and new connections to the water, and the Friends of the Elizabeth River Trail Foundation has been created to implement it.