Every entrepreneur owes his or her start to something --the right mentor, the right investor, the right timing, and so on.
For me and a growing contingent of entrepreneurs, much of this start can be attributed to the right place: St. Louis, Missouri.
I first moved to the city to attend Washington University. I stayed for several years after graduation because St. Louis is a vibrant place with a lot of cool stuff going on. It's also a relatively cheap place to live, which was a huge relief when I was starting my own company and couldn't initially afford to pay myself much.
In the process of starting that company, I discovered what makes St. Louis highly valuable to would-be founders: The city is truly dedicated to helping startups thrive.
From the nonprofit Arch Grants program (which offers funding with no equity) to the Cortex Innovation Community (a 200-acre innovation hub and technology district in the heart of St. Louis), Cultivation Capital (a venture capital firm that supports multiple accelerator programs), and SixThirty (a global FinTech venture fund and business development program), St. Louis promises no shortage of resources for budding entrepreneurs.
And it's exactly resources like these that explains why entrepreneurs are increasingly willing to leave the traditional startup hubs in search of greener (and more cost-effective) pastures. Those entrepreneurs who are brave enough to break with convention are finding boundless support in the middle of America.
For proof, look no further than SwipeSum founder Michael Seaman. Here's how St. Louis is helping his startup.
Leaving L.A. in pursuit of the Midwest.
Even as a growing number of startups relocate to the American heartland, many aspiring entrepreneurs still believe the only viable place for a startup is in major coastal cities.
That was definitely true for Seaman, whose company SwipeSum (a financial business software startup that saved U.S. business owners over $2.3 million in 2017 alone) had been growing like gangbusters out of Seaman's former hometown of Venice Beach, CA.
"We started getting some traction... and I told [the remote team], 'Pack your bags; we're gonna get an office here in Venice Beach,'" says Seaman.
A core part of that team was Seaman's brother, who lived in St. Louis and rebelled at the idea of moving. "He was like, 'That's stupid. You really need to be in St. Louis,'" says Seaman. "So I said, 'OK, I'll come for a weekend.'"
That visit was nothing short of eye-opening. "St. Louis is one of the coolest unknown cities in the U.S." says Seaman. It also quickly became apparent that the city is a stellar place to house a startup. "The government is actually helping," says Seaman. "And it's not like fake helping. They're actually trying."
The move also made sense financially. "You have some of the best talent and work ethic, and it's at a very affordable price," says Seaman. "If you're raising money for your startup, would you rather have a million dollars in L.A., where labor costs are higher, rent is higher, everything's higher, so you kind of stress yourself out more, or would you rather have the exact same or better chance of being successful with a longer runway and more help behind you in St. Louis?"
So Seaman made the bold decision to move his burgeoning startup to the Midwest. And it's proved to be one of the best decisions he's ever made.
"Since being here, we've had calls with state development committees where there are 20 people on the call to see what they can do in terms of tax incentives, hiring, and so on," says Seaman. "We've had the warmest welcome. And it's basically just accelerated everything."
Seaman contrasts this warm welcome to his experiences in L.A., where even his in-town partners wouldn't invite him to meetings. He also recounts walking into any Starbucks and seeing startups grinding away at tables because they couldn't afford office space.
"If I could just tell them what I know now," says Seaman. "It's acceptable not to have a company out of the Bay Area. I have so much more faith in the success that the company will have because we're here. And I don't think I could say that if I was working out of a co-working space all cramped up in Santa Monica."
Raising money in America's heartland.
Not only has St. Louis' government been enormously supportive of SwipeSum's transition to the city--so too have its regional investors.
"The big thing about the Midwest in general is that there has been a classic lack of early-stage and seed raise funding," says Seaman. "[There's an] idea that it's limiting [to raise money in the Midwest]."
So far, Seaman's experience suggests the opposite. SwipeSum is still raising money for its seed round, and they're looking for most of that funding in the Midwest.
"We've been walked into the offices of the most successful CEOs in the region," he says. "Within our first month [of being in St. Louis] we had our first St. Louis investors. We're in closing conversations with some of the biggest names [in the region]. We can get it easier on the coast; I know we can... but I think that we're kind of at the beginning of the wave. I think we will close our round in the next few months with St. Louis money or Midwest money."
Giving back to the city that gives to his company.
No relationship should be a one-way street. Because St. Louis has embraced SwipeSum, it's important to Seaman that his company embrace the St. Louis community just as much.
"I realized that to truly make ourselves part of this community, we have to give back," he says. "If we want the community to grab us, then I'm gonna give as much as I can to them first."
One way SwipeSum is doing that is by hiring locally, thereby generating more jobs in the area. But Seaman wanted to do even more. So his team came up with the idea of giving away SwipeSum's paid services--for free--to any St. Louis business. "Basically, it gives them a payments and financial business software expert on their team for free--forever," says Seaman.
Not surprisingly, this initiative is already helping to engrain SwipeSum in the St. Louis community. The mayor herself issued a statement on SwipeSum's behalf, and interest in the company and its services is skyrocketing. Seaman even went so far as to make the city a counterpoint of his marketing strategy, as seen in the video below:
"We definitely have the community behind us," says Seaman. "If you go embrace the community a little bit, it pays off tenfold."
Having committed to growing his startup in the Midwest, Seaman is now on a mission to encourage other founders to look beyond major coastal cities to the resources hidden around the country.
"St. Louis will give us the base to be successful here and to reach all of our goals and milestones," says Seaman. "I also think we'll have the platform to let other startups and companies know that they don't have to give away as much of their company to be successful here. The same resources or more are here already. If you come and you have a good idea, you will be successful."