Wired Magazine recently ran a profile of the top startup cities in Europe. They profiled the most exciting startups in Stockholm, Amsterdam, Paris, London, Lisbon, and Helsinki. Noticeably absent from this list was Edinburgh. Edinburgh has the highest per capita rate of 'unicorns' in Europe and the third world wide. It has one of top performing private accelerators in the world in CodeBase and one of the world's best computer science departments.
The question is: why it didn't make the list?
This isn't just a question of the ego of a city (or my own ego) left off the hot or not list. An entrepreneurial ecosystem's global profile has a big impact on its future success. Ecosystems aren't real things that exist; much like Tinkerbell they only live as long as people believe in them. A place's perceived success will attract investors to it as well as budding entrepreneurs and startup employees. Generating a buzz about a place helps make it easier to get people to lend their time, energy, and passion to organising and running the entrepreneurial groups that make up an ecosystem. Companies benefit from this. This creates a virtuous cycle: successful entrepreneurial ecosystems create attention which helps establish the place as an 'entrepreneurial city.' This helps attract talent, investment, and customers. This in turn helps the ecosystem perform better, increasing the attention it gets from the global business press and community. Rinse and repeat until they make an HBO show about you.
The challenge for Edinburgh is how can it stop punching below it's weight? How can it attract media attention that goes beyond the local Scottish press (with the occasional profile from the FT when they venture North of the Wall). Part of the problem is that the city's two big successes — Skyscanner and Fanduel — aren't really connected to the place. Not to say that they aren't engaged with the community, they are, but the businesses themselves are disconnected from Edinburgh. Fanduel is for all intents and purposes an American company and Skyscanner is seen as a global company rather than a Scottish one. Good for Skyscanner, bad for Edinburgh.
However, effectively branding an entrepreneurial ecosystem requires more than just press junkets and advertisements. It requires building a narrative that connects the history of the place with its future and helps explain why there is so much exciting activity happening there. A startup ecosystem isn't just a bunch of cool new ventures succeeding by themselves; it's an entire community that helps support innovative entrepreneurship.
Waterloo, Canada is a great example of how to do this. The city has not only helped develop numerous high growth tech firms like Blackberry (not so high growth any more), Kik Messenger and Tribe HR, but also attract offices from players like Google and Microsoft. This despite being a fairly small city just an hour away from the much bigger metropolis of Toronto. Waterloo has worked hard to build a narrative that connects its Mennonite and German history with its contemporary technology success. Drawing on this, they've been able to create the myth of Waterloo as Quantum Valley. This has help attract substantial interest from investors and researchers.
Ironically, Edinburgh literally pioneered the idea of city branding. Walter Scott, author of books like Waverly and Ivanhoe, helped brand Scotland and Edinburgh with the image of Tartan and Highlanders. He used this image to arrange a trip by King George IV to Edinburgh, which was a boom to the city's businesses.
What can regions do to try to build their global ecosystem brand?
- While ecosystems need a diverse range of actors experimenting with new ideas, successful branding seems to require a prime actor. Communitech in Waterloo has been successful in part because everyone in the community sees it as the most important agency for building Waterloo's global brand.
- Everyone needs to help. That single organisation can't do everything on its own. Companies and entrepreneurs should be proud about where they come from and why that place is great.
- Internal communication is as important as external broadcasts. Building a shared story about the ecosystem needs to happen internally. It can't be imposed from the top down but has to emerge through consensus and shared myth making.