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Innovation districts: turning around social and economic performance requires go beyond "tech parks" into social ecosystems

 

Around the world, cities and region grow innovation districts trying to emulate the success of Siliucon Valley  Creating sustainable startups able to provide well-paying high-quality jobs requires more than building tech parks and removing red tape. Developing successful startups require at least 2 years of comprehensive business programs with proven track records. Programs, like the Performance Improvement Institute implemented in Arizona-Sonora megarregion since 2005, increase startups "survival rate" from 30 % -the world's average in tech parks and conventional incubator- to over 70 percent (PII's rate stands aat 86 % over a 10-year period)

 

Here's PII consolidated business case for the entire Southern Sonora corridor, measuring and monetizing job  creation, startups' revenue for the district and different companies and industries:

 Three recently published books exploring the engines for growth and social development in the knowledge economy of the 21 century expose different facets of the creation of entrepreneurial ecosystems that are the focus of the work of our Performance Improvement Institute (PII/IMD).

 

We will introduce in this article the first of those books, written by Brookings Institution researchers in urban development Bruce Katz and Jennifer Bradley, "The Metropolitan revolution", published in 2013 that follows on our article on The power of entrepreneurial ecosystems (2009)

 

 

Katz and Bradley reviewed multiple "innovation districts" in US and Europe, defined as those areas of cities that "cluster and connect leading-edge anchor institutions and cutting-edge innovative firms with supporting and spin-off companies, business incubators, mixed-use housing, office and retail, and twenty-first-century amenities and transport."

 

As with PII's Southern Sonora Corridor and the bi-national (US-Mexico) Ari-Son mega-region that PII developed and were presented in previous articles by Gonzalo Rodriguez Villanueva and myself, innovation districts are creating thousands of high-paying jobs in urban areas by concentrating and combining cutting-edge researchers, angel and venture capital, research universities, forward-thinking "global cities" initiatives and startups in relative small, formerly neglected areas of cities such as Barcelona Activa,

 

 

That actually started the tendency toward creating innovation districts by taking over a rundown industrial area of the city and turning it into a housing-innovation-cluster- district right in the city.

 

One of the first buildings renovated by Barcelona Activa was a 1904 abandoned factory. 4,500 firms have relocated to that area, 10 universities and more than 12 R&D clusters,

 

 

Boston's MIT

 that has already created an economy in the surroundings equivalent in GDP to one of the first 10 states in the US, is now working with the city  in developing 

Kendall-Square, rezoning 26 acres for 8 new of its own buildings but -more significantly-, to create 1 million square feet of office space and 240,000 square feet of affordable housing.

 

and Detroit (this last case a demonstration of what we describe in an earlier 2009 paper as the ability

 

of entrepreneurial ecosystems for  "extracting boom from bust"), where the city, Wayne State University and PII partners

 

Such as Whole Foods are attracting talented young professionals to more central areas of the city with startups, and clusters that provide jobs but also with better quality of living and vibrant city life in the district

 

These districts go beyond the concept of "industry clusters" or "incubators" by adding a social dimension to attract and retain highly educated human capital:

 

"Innovation districts arise in disparate geographies with different economic drivers. But all of them draw from the best innovations in both industry cluster and place-making strategies to create well-defined communities packed with resources for firms, entrepreneurs, innovators, researchers, and residents. The theory behind business clusters is that the geographical concentration of interconnected firms and supporting institutions leads to more innovation and production efficiencies, shared inputs, thicker labor markets, and collective problem solving; the theory behind walkable urbanism is that dense, mixed-use neighborhoods with cultural, recreational, and retail amenities will attract highly educated, innovative, entrepreneurial individuals and benefit the neighborhood's existing residents."

 

 

MIT in Boston and University of Barcelona in Spain have developed this "innovation districts" by providing not only intellectual and financial capital, but also human capital, understood as the conditions that attract and support talent and families of highly educated and creative young professionals to move into certain parts of the city where they can be at "walking distance" from colleagues engaged in R&D and entrepreneurial activities, top-notch research and incubation university programs (sometimes engaging multiple teams from different schools) and affordable, attractive housing and lively, culturally rich and diverse neighborhoods.

 

Our Performance Improvement Institute has a proven program for creating innovation districts to make them succeed, based on studying and sharing different experiences and expertise around the world.

 

Bernardez (2009) The power of entrepreneurial ecosystems: extracting "booms" from "busts" - Performance Improvement Quarterly, PIQ

 

Katz, Bruce; Bradley, Jennifer. The Metropolitan Revolution: How Cities and Metros Are Fixing Our Broken Politics and Fragile Economy (Brookings Focus Book) (p. 114). Brookings Institution Press. Kindle Edition.

 

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