W
e all heard the bad news. When Amazon announced the 20 cities it was considering for “HQ2,” its second headquarters where as many as 50,000 employees would work and as much as $5 billion would be invested, Nashville was included. So was Atlanta, Chicago and Los Angeles — even Austin and Dallas. But Houston? It was the largest city not on the list. How could a place with such a reputation for innovation — the home to the largest medical center in the world, home to NASA and ExxonMobil and the Astrodome — not be included? Quickly, the story became that Houston was “snubbed”. At least to some, though, it wasn’t a “snub” at all. Jeff Reichman, the founder of Sketch City and principal at January Advisors and a leading voice in Houston’s tech scene, wasn’t optimistic about the bid. “I didn’t think we had much of a chance to begin with,” he says. “Houston has a lot going for it, but we don’t have the type of technology workforce and the numbers that Amazon would be looking for.” “In other cities,” Reichman says, “you’ve had generations of start-up success. A start-up hires lots of people. Those people have experience growing that company. They have an exit. Those people are now wealthy. They invest in new start-ups, and they pay it forward generation through generation. In Silicon Valley, that’s been going on for 100 years. In Austin, it’s been going on for over 20 years. You have these generations of success. In Houston, we’re starting from scratch every generation.” Houston Mayor Sylvester Turner called Amazon’s decision a “wake-up call”. The good news is that it didn’t take long for Houston to wake up. Just
a few months later, Mayor Turner, along with Rice University, the Medical Center and Station Houston — long the pumping heart of the city’s tech scene — announced that a new tech hub would be forming in the former Sears in Midtown. Rice, which owns the 9.4 acres around the 1939 Art Deco building, is investing $100 million to create an “innovation district”. The building, located on the light rail line, will be renovated by a team hired by Rice comprising Hines, Gensler and the New York City architect James Carpenter. There are also plans to develop housing, restaurants and open spaces. It’s expected to be completed by 2020. John Reale, co-founder and CEO of Station, said, “Startups want to be in a place that’s cool and welcome, and where they get all the resources they need to create.” The move to create this innovation district makes real an idea that had been forming for years, in fact, even before the Amazon decision. Houston’s bid included an idea organizers called the “innovation corridor,” which recognized the need to create more density for investors and entrepreneurs to collide. Amanda Edwards, elected to the At-Large Position 4 in Houston’s City Council, has been leading Mayor Turner’s Technology and Innovation Task Force. She has understood for years how crucial tech is to Houston’s future. “The Fortune 500 companies of today are not the ones of yesterday,” she says. The charge for the task force, Edwards says, is “to build a more robust tech ecosystem” that would support existing industries — namely, health care and energy — as well as encourage growth in others. She believes that not only could this ecosystem boost
Houston’s overall economy, it can “cut across” socioeconomic levels to provide more opportunity for underserved communities to succeed. And at the center of this ecosystem will be Station. The company, which connects entrepreneurs to investors and vice versa, and provides resources, classes, workshops and more, now has about 500 members. “It started a few years ago at the nowdemolished Caroline Collective in the Museum District,” says Grace Rodriguez, a co-founder and Station’s Chief Experience Officer. But the company keeps growing. It relocated Downtown in 2016 and will anchor the tech hub in 2020. “With the rise of the creative class,” Rodriguez says, “there was a demand for something like Station. We’re constantly losing talent to Austin or the coasts. Houston needs a start-up hub that serves this kind of group of people.” Rodriguez says she’s excited. “We have the arts, we have the Museum District, we have a world-class medical center, but everywhere I’ve gone is how amazing the people are. People are the city’s great asset.” Could the Amazon “snub” be one of the best things to have happened to Houston? Now, instead of depending on a single corporate behemoth to award the city with a one-time crush of jobs, the city is positioned to grow organically, if more slowly, attracting start-ups, entrepreneurs and investors from a variety of industries who can spark the city’s “innovation economy” — and all from the ground up.
by Allyn West