The bad news: Hoosiers aren’t starting companies more frequently than they were a decade ago, in spite of a massive combined effort by government, universities and private investors to spur business generation.
That’s the word from a May report by the Ewing Marion Kauffman Foundation (see story, page 3).
The good news: Our position nationally hasn’t fallen much, because many other states aren’t doing much better. Indiana remains solidly in the center.
“We seem to be hanging in there with [states such as Massachusetts, North Carolina and Washington],” said Donald Kuratko, who heads the entrepreneurship program at Indiana University.
“Hanging in there” doesn’t seem adequate, given the explosion of technology parks, college entrepreneurship programs, business incubators and government assistance in recent years. The past decade also has seen the birth of groups such as TechPoint and BioCrossroads, which promote the state’s technology and life sciences sectors, respectively.
Has it all been worth it?
David Millard answers with a resounding “yes!”
“The combination of all of these things happening has really made a change in Indiana’s economic environment for entrepreneurship,” said Millard, chairman of the business department at the local law firm Barnes and Thornburg. “I think the health of that is fantastic, the best of my 30-year career. Certainly, we have the most vibrant entrepreneurial economy in the Midwest.”
Although the sheer number of new businesses here may lag other states, our number of new “high-impact” firms has soared, Millard said. One example is ExactTarget, a local e-mail marketing company that was founded 10 years ago and now employs more than 700. Its rapid expansion is chronicled in a story on page 9.
The growth of such companies is a reminder that, even in the midst of a recession, businesses are flourishing around us. We congratulate the universities, trade groups and organizations such as the Venture Club that have kept the fire burning for business generation in spite of the faltering economy. Indeed, the Venture Club nearly folded a couple of times in the past, but now is drawing capacity crowds every month and has become one of the largest groups of its kind in the country.
Indiana has learned to grow smarter by targeting areas of strength, such as life sciences and electronic medical records and, more recently, electric vehicles and wind power.
One damper on growth has been the shrinking of the 21st Century Research and Technology Fund, which has lost half its support because of state budget woes. The fund provides capital to fledgling firms at a critical time, when they are nearing commercialization of their products.
As soon as state revenue permits, the state should bring this key program back to its funding level of $37 million a year, or boost it even higher. Once the fund is replenished and the economy revives, Indiana is poised to shine.
In the meantime, we must not allow the recession to cause us to slack off on our efforts to create and grow promising businesses. This work is paying off handsomely, in spite of what some statistics say.•
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