An unlikely haven for entrepreneurs is rising on the Mississippi: St. Louis, Missouri. One noteworthy success story is David Dresner, founder of local startups Sleeve-a-Message and Coast-a-Message – companies that print small-run orders of custom coffee sleeves and coasters, count over 30 employees, and have over 2,000 customers. He has since expanded his entrepreneurial ambitions by launching a gourmet dumpling company, opening a restaurant, and buying three commercial buildings to house his companies and other tenants.
Dresner credits his impressive success to the unique collection of resources available in St. Louis. As he tells Project Invested, “what originally attracted me to St. Louis was a tax credit program. They gave me $250,000 called the Rebuilding Community tax credit. … I stayed in St. Louis because it was just a better climate for manufacturing than [my home state of] Illinois.” This program gave Dresner 40% back on the machinery and computers he purchased so he could hire more employees, enabling him to focus more on raising capital and networking – two elements he says the city has in spades.
Before acquiring his own real estate, Dresner took advantage of subsidized office space in local business incubators T-Rex and STL VentureWorks. “These incubators are telling you about fundraising competitions, networking events all day long,” says Dresner. “There’s so many resources if you spent your day going to all of them you would never get anything done.” For hungry entrepreneurs, he says “the money is very much here.” Dresner has used a variety of financial instruments across his ventures and thinks he will eventually go public with some, noting that “the lifecycle of any business requires capital fundraisers to grow.”
St. Louis’ entrepreneurial resurgence started in 2005 with the launch of the Missouri Technology Corporation (MTC). Created by the Missouri state legislature, the public-private partnership’s mission is to “promote entrepreneurship and foster the growth of new and emerging high-tech companies.” Through Missouri’s IDEA Funds, since 2001 MTC has invested $30 million in 91 companies that went on to raise over $350 million in private capital. Among the recipients of MTC funding are T-Rex and STL VentureWorks, which turned out to be very good news for Dresner.
Dresner says that the growing entrepreneurial community is directly responsible for driving growth and renewal in St. Louis, especially in its downtown core. “I’ve definitely invested in downtown St. Louis”, he says. “A lot of the big buildings have been sold and they’re being developed aggressively. I look forward to filling in a few of the gaps, and I’m definitely seeing a lot of momentum.”
A new public-private partnership launched in 2015 – Downtown STL – is seeking to create a robust innovation district that will draw 1,000 companies and 10,000 new workers by 2025. They are well on their way: by the end of 2015, downtown St. Louis counted 260 startups with 4,000 workers. Several committees have been set up to support this goal, focused on topics such as programming, infrastructure and financial projects, and $1 billion worth of new developments are already in progress.
Downtown St. Louis is also appealing to entrepreneurs as it is the hub of financial services activity in the region. St. Louis is home to three of the ten largest U.S. financial advisory firms, and is the third most concentrated market for investment advisors after New York and Boston, with over $2.8 trillion in assets managed there. This financial industry community is very engaged through initiatives such as the Greater St. Louis Financial Forum. Launched by the Regional Chamber and Growth Association, CEOs from 30 banks and brokerages routinely convene to make St. Louis a leading regional financial center.
Since 2009, the number of businesses launched in St. Louis has risen every year, and the city now ranks 26th among the top 40 metro areas – besting cities like Pittsburgh, Columbus, and Philadelphia. According to the latest Census Bureau data, 9.7% of businesses in the St. Louis metro area were less than a year old – 3% higher than in 2009, and second only to Elizabethtown, KY in overall startup growth. Given all this, the Gateway City looks ready to welcome an entrepreneurial renaissance.