All posts in “Columbus”

Cleveland offered $120 million in freebies lure Amazon to the city

A Cleveland.com article detailed the lengths the small midwestern city would go to lure Amazon’s in 50,000-person HQ2. In a document obtained by reporter Mark Naymik, we learn that Cleveland was ready to give over $120 million in free services to Amazon including considerably reduced fares on Cleveland-area trains and buses.

The document, available here, focuses on the Northeast Ohio Areawide Coordinating Agency (NOACA)’s ideas regarding the key component in many of Amazon’s decisions – transportation.

Ohio has a budding but often tendentious connection to public transport. Cities like Columbus have no light rail while Cincinnati just installed a rudimentary system. Cleveland, for its part, has a solid if underused system already in place.

That the city would offer discounts is not surprising. Cities were falling over themselves to gain what many would consider – including Amazon itself – a costly incursion on the city chosen. However, given the perceived importance of having Amazon land in a small city – including growth of the startup and tech ecosystems – you can see why Cleveland would want to give away plenty of goodies.

Ultimately the American Midwest is at a crossroads. It could go either way, with small cities growing into vibrant artistic and creative hubs or those same cities falling into further decline. And the odds are stacked against them.

The biggest city, Chicago, is a transport, finance, and logistics hub and draws talent from smaller cities that orbit it. Further, “smart” cities like Pittsburgh and Ann Arbor steal the brightest students who go on to the coasts after graduation. As Richard Florida noted, the cities with a vibrant Creative Class are often the ones that succeed in this often rigged race and many cities just can’t generate any sort of creative ecosystem – cultural or otherwise – that could support a behemoth like Amazon landing in its midst.

What Cleveland did wasn’t wrong. However, it did work hard to keep the information secret, a consideration that could be dangerous. After all, as Maryland Transportation Secretary Pete K. Rahn told reporters: “Our statement for HQ2 is we’ll provide whatever is necessary to Amazon when they need it. For all practical purposes, it’s a blank check.”

Rapchat raises $1.6 million to help you make and share your def jams

The first thing to understand about media-sharing app Rapchat is that co-founder Seth Miller is not a rapper and his other co-founder, Pat Gibson, is. Together they created Rapchat, a service for making and sharing raps, and the conjunction of rapper and nerd seems to be really taking off.

Since we last looked at the app in 2016 (you can see Tito’s review below), a lot has changed. The team has raised $1.6 million in funding from investors out of Oakland and the Midwest. Their app, which is sort of a musical.ly for rap, is a top 50 music app on iOS and Android and hit 100 million listens since launch. In short, their little social network/sharing platform is a “millionaire in the making, boss of [its] team, bringin home the bacon.”

The pair’s rap bona fides are genuine. Gibson has opened or performed with Big Sean, Wiz Khalifa and Machine Gun Kelly, and he’s sold beats to MTV. “My music has garnered over 20M+ plays across YouTube, SoundCloud and more,” he wrote me, boasting in the semi-churlish manner of a rapper with a “beef.” Miller, on the other hand, likes to freestyle.

“I grew up loving to freestyle with friends at OU and I noticed lots of other millennials did this too (even if most suck lol) … at any party at 3am – there would always be a group of people in the corner freestyling,” he said. “At the same time Snapchat was blowing up on campus and just thought you should be able to do the same exact thing for rap.”

Gibson, on the other hand, saw it as a serious tool to help him with his music.

“I spent a lot of time, energy and resources making music,” he said. “I was producing the beats, writing the songs, recording/mixing the vocals, mastering the project, then distributing & promoting the music all by myself. With Rapchat, there’s a library of 1,000+ beats from top producers, an instant recording studio in your pocket, and the network to distribute your music worldwide and be discovered…. all from a free app. Rapchat is disrupting the creation, collaboration, distribution, & discovery of music via mobile.”

“We have a much bigger but also more active community than any other music creation app,” said Miller.

While it’s clear the world needs another sharing platform like it needs a hole in the head, thanks to a rabid fan base and a great idea, the team has ensured that Rapchat is not, as they say, wicka-wicka-whack. That, in the end, is all that matters.

Columbus could be the next startup city

Ever since I wrote about the Midwest last year I’ve been keeping my eyes on Columbus. I decided to hold a small pitch-off to meet some of the startups I saw last time I had driven through. The pitch-off was a success and a company called Wyzzer took first place and the quirky Hopper Carts came in second. But what I really came away with was a new respect for Columbus as a startup hub.

You see, I grew up in Columbus and I wanted to see how much it’s changed.

And it has changed. A lot.

On the aggregate a city like Columbus is the model for the future. There is manufacturing, farming, retail, brewing, and ecommerce all in a few square miles. The people are ready to expand and learn and there are plenty of smart folks who are willing to leave high-priced real estate in New York and San Francisco to get a house with a back yard down the street from a beer garden in one of the city’s urban enclaves. I asked around and heard that things are getting even better. Here are a few points I discovered during my visit.

All eyes are on Columbus. And they can’t fail. The city just received a $277 million Smart City grant from the federal government to build out tools and techniques that will define the city of the future. So far it looks like the Mayor Andy Ginther and the city government is dragging its feet but there is hope. While other cities – most notably Pittsburgh – vied for the grant, Columbus got it on the power of private industry and public infrastructure. And now it has four years to deliver. I’ve met a few small startups who are trying to work with the Smart City task force to build out the initiative but there’s little promising thus far.

That said, it’s great Columbus got the nod. There is a lot of promise here as long as government gets into gear and starts working with local entrepreneurs and, most important, this grant can help a thousand startups blossom. It’s a win-win for the government and the city. It just can’t be squandered.

Further, the quality of life is about to hipsterize. In comparison to cosmopolitan Chicago and small, cool towns like Raleigh, Columbus is still a mixture of malls and suburbs. That’s swiftly changing. I lived in Columbus until college and I saw the rough and ready bars of the Campus and Short North District slowly wink out one by one. Then, when I began returning in the 2000s, I saw entire swathes of urban business turn into a sterile sprawl. In short, between 1993 and 2008 or so Columbus got boring.

That’s swiftly changing. The Short North District is a booming pleasure dome dedicated to deep fried pickles and great drinks. Upstarts like Hot Chicken Takeover and carts like PutItInYourFace are replacing the T.G.I. Fridays and Applebees. Microbrews have rousted Coors and Bud. Columbus, like so many other cities, has become comfortable, artisanal, and pleasant. But, because that process is just beginning, there’s still time to get in on the ground floor. There is plenty of room to grow. While many of the rich suburbs are hopeless as magnets for art and commerce the are still places in the city that have plenty of promise. As I wrote last week the city has plenty of rotting malls it can easily turn into unique shopping and eating experiences.

One con? The Columbus ecosystem is small. Columbus has a population of 835,957 with a regular influx of students that leaves over the summer. It’s long been known as a collector of corporate offices – Chase is here as is Nationwide and the Limited. It has never been an “entrepreneurial town” per se and instead depending on the steady flow of students from the halls of OSU to the cubicles of the corporates. That’s changing.

The ecosystem, however, is as nascent as other similarly-sized cities. A few things have been tried but few of the accelerators are able to keep successful entrepreneurs rooted to the city, an important aspect of ecosystem building. I’d like to see more of that over time and I’m sure that slowly but surely we can see some folks settling down to enjoy some Jenni’s and Donato’s with the natives.

Columbus startups need seed badly. There are a few VCs in the area – Rev1, Drive, and Loud Capital are names you hear often – but like most smaller markets the drive to fund smaller startups in negligible. Loud, a startup itself, is the closest to an on-the-ground seed group while Drive is looking for comfortable later stage investments. Accelerators like Fintech71 see the value of seed in specific markets but they’re finding deal-flow difficult. Therefore both investors and startups in the city are usually stuck – a situation is extremely common in cities like Columbus.