On May 18, Red e App hosted an event for Insider Louisville and the Louisville Digital Association about entrepreneurship in Louisville. Hunter Hammonds of Impulcity, Wright Steenrod of Chrysalis Ventures, Katie Bush of KBD, Terry Gill of EnterpriseCorp, and our own Jonathan Erwin of Red e App were the panelists, moderated by Tom Cottingham, CEO of Insider Louisville. The topics discussed included venture capital, engineering talent, and whether companies can grow and thrive in Louisville without having to bow to outside investors.
Wright Steenrod and Katie Bush both started on the same note: Every city has these meetings because every city wants to be Silicon Valley. Katie Bush said, “We cannot be Silicon Valley, but that does not mean we cannot have a thriving startup scene. Focusing on the innovation needed by the local enterprises is a good place to start.”
“What it comes down to is what the entrepreneur knows, the idea and the team. If you’re compelling, the money will come to you.” Steenrod said. In a city with major companies centered around healthcare and logistics, it doesn’t hurt to play to Louisville’s strengths either.
That said, Louisville’s entrepreneurs need to know the struggles of the companies in our backyard. “Corporate engagement is not something we do well. We need more insight in what local corporations are struggling with. Entrepreneurs need to establish relationships with them.” said Terry Gill.
General consensus is that Louisville’s investing culture is risk averse, which is what prompted Hunter Hammonds to move his startup to Cincinnati in 2011. “I wish that people had been more involved. We raised money without guidance and insight.” Hammonds said. “Louisville is an amazing city with a great creative population but there is a lack of people who are brutally honest.”
As an entrepreneur, Hammonds emphasized the importance of having a group of advisors who had the time to be very involved in his startup. He acknowledged that there seems to be significantly more people involved in the startup scene here than 4 years ago, perhaps indicating that things are moving in the right direction.
According to Terry Gill, there has been a 50 percent increase in the number of startups in this community over the past 10 years. At the same time though, less new businesses are scaling up. Jonathan Erwin is convinced there is money here, people just need to be educated around risk. “Venture capitalists look for traction. Most startups don’t have that. There is capital in Louisville, the seed money just needs to be wiser when deciding where it goes,” Erwin said.
Fortunately, Louisville is very flat socially. It is much easier to get a coffee meeting with investors or stakeholders than entrepreneurs might think. You need to be laser focused on what you need, though.
Hunter Hammonds will not request a meeting with a peer or advisor without a clear list of what he needs and what it is for. He said, “Don’t be afraid to ask for specific things.”
Louisville is an affordable place to live, which can be a selling point when trying to get developers to work for startups here. Katie Bush still sees many programmers leaving though. “We need an environment that keeps developers here,” Hammonds said, stressing the need for a diverse group of local developers.
As you can say about every city: Louisville has its pros and cons. Louisville as a whole has to play to its strengths. A modest cost of living can be a recruiting tool for an ever growing need for developers. Risk aversion is ok, but when the right company comes along, investors have to be willing to make big bets on them.
We want to thank all of the panelists for attending, and hope this conversation sparks further discussion about Louisville startup climate. If you have any insights you gathered from the event, let us know below.
To see some photos of the event from Insider Louisville, click here.