HQ2 or not, St. Louis has potential to become the next silicon city
Amazon’s RFP for a second headquarters — HQ2 — was the shot heard round the world. More than 238 proposals were submitted by states, cities and organizations eager to attract the $5 billion opportunity.
St. Louis answered the rally cry with a proposal of its own, drawing on support from communities on both sides of the river. According to St. Louis Economic Development Partnership CEO Sheila Sweeney, “[The St. Louis proposal] ticked all the boxes for Amazon’s HQ2 — a strong workforce, urban site availability, mass transit and a great cost of living.”
Whether St. Louis will be chosen or not, the race to the RFP deadline is over. Now it’s a waiting game until Amazon announces the winner in 2018. The St. Louis proposal has turned some heads, and regardless of the decision, we’re working hard every day to keep those heads turned.
In the process of developing its proposal, the St. Louis metropolitan area proved something. We have the infrastructure, talent and governmental support to become a great tech city.
Why St. Louis still has the capacity to grow as a tech city
St. Louis has a pedigree of world-class corporations planting their roots here — and succeeding. Companies like Energizer, Anheuser-Busch and Purina have called St. Louis home. And for good reason. It’s centrally located — a third of the U.S. population lives within 500 miles, and 90% lives within 1,500 miles. We have railroad access, a major airport and are located along the longest river in North America. Plus, the cost of living is reasonable compared with other metropolitan areas in the U.S.
Entering the modern age, St. Louis’ tradition of innovation and success continues. Winners or not, St. Louis is — and will remain — an innovative powerhouse with the potential to grow into the next silicon city.
Here’s why we believe St. Louis still has the capacity to grow as a tech city, regardless of the HQ2 decision:
Local support for innovators
St. Louis has received nationwide attention for its commitment to innovation, and for its vibrant startup community. It’s been named the fastest-growing startup city in the country by Business Insider and Popular Mechanic, and it’s been called the “new startup frontier” by FiveThirtyEight.
In a time when other cities around the country are experiencing a startup slump, St. Louis’ startup scene is growing rapidly. In 2015 alone, the St. Louis scene experienced 343% in deal growth.
According to research from the Kauffman organization, a shifting entrepreneurial landscape may have laid the groundwork for this growth. In the wake of many big corporations relocating headquarters or changing ownership — Anheuser-Busch, Southwestern Bell and Boeing, among others — the economy changed. Public and private sector organizations reacted by coming together to promote local entrepreneurship and support startups.
From 1987 to 2013, organizations like CORTEX, ITEN, T-REX and Arch Grants appeared on the scene, and sprang into action, supporting local entrepreneurs from all industries. In addition to financial support, these organizations also fostered a sense of camaraderie and support amongst entrepreneurs themselves — laying the groundwork for a startup scene able to attract talent and entrepreneurs from throughout the region. The St. Louis startup environment is one of innovation, support and excitement, ripe and ready to grow into the next silicon city.
Proximity to other key players
Not only is St. Louis a key player in the Silicon Prairie — Kansas City is a big tech hub as well. On the same list where St. Louis was named the fastest growing startup city in the country, Kansas City earned a respectable tenth. Together, Kansas City and St. Louis would become a tech force to be reckoned with.
And that’s one reason the STL-KC Hyperloop One Proposal garnered national attention. Dan Katz, Hyperloop One’s director of public policy said the Missouri proposal was “one of the best we’ve ever seen.”
The proposal didn’t win, but Missouri has started their own $1.5 million feasibility study for a Hyperloop. The distance between the city is about four hours by car. By Hyperloop, it would be just 31 minutes.
Even if the Hyperloop never comes to Missouri, the proximity between the two cities makes Missouri a big player in the tech world. But with an instant and direct line between two of the fastest growing tech cities, the two cities would become exponentially more attractive for startup entrepreneurs, young talent and investment dollars.
A key Midwest data market
Named an Emerging Major Data Center by Tier 1 in 2011, the Missouri data center market has continued to develop and grow. Dozens of major companies such as Mercy Health, Monsanto and Enterprise have established successful data centers in Missouri, with many new data centers on the way.
Missouri’s tax exemption programs for data centers and comparatively low utility costs makes the state an attractive option from a financial standpoint. Beyond that, Missouri has the technological talent required to run a major data center. In the St. Louis region alone, there are around 80,000 STEM-related professionals. The business-friendly environment and the wealth of talent make Missouri an instrumental data center market in the Midwest.
Fiber optic networks provide greater security, reliability and scalability benefits than other high-speed internet connections at a fraction of the lifetime cost. Fiber connections are available in both Kansas City and St. Louis.
Although Google Fiber isn’t available in St. Louis, there are several providers of dark fiber services such as Arch Fiber Networks in downtown St. Louis. Businesses in the city are embracing the faster speeds, as well as the control and security fiber networks provide. In fact, a major technological hotspot in the heart of St. Louis’ downtown housing more than 100 startups —the T-REX building— jumped at the chance for fiber network access.
As more businesses light up the dark fiber, gigabit internet will become a draw for tech startups and innovators. As a gigabit city, St. Louis will be better able to support the security and scalability requirements of quickly growing startups. To learn more about how the security, speed and flexibility benefits of dark fiber, read this guide to dark fiber basics.
Not only is the St. Louis startup scene geographically concentrated —similar to Silicon Valley itself— but it is interconnected. Entrepreneurs and support organizations are learning and feeding off of each other. Drawing on and developing these connections between organizations and entrepreneurs, we can build a positive momentum in St. Louis’ tech scene and put the Gateway City on the track to becoming the next silicon city.
Hyperloop or not, HQ2 or not, St. Louis has what it takes to grow as a technological powerhouse. It’s up to us —and the rest of the “Innovation Corridor”— to leverage our existing infrastructure, talent and governmental support to continue growing and developing for years to come.
To learn more about the financial, technical and logistical considerations for successfully utilizing dark fiber, read our guide to fiber networking.