New Orleans as a Brain Magnet
You could call it our entrepreneurial “spring.” Creative enterprise is coming into full bloom in New Orleans, as evidenced by the fact that it’s increasingly difficult to keep up with all the business success stories.
Consider William Kethman, a 24-year-old Tulane University medical student who founded NOvate Medical Technologies. He invented a disposable clamp that safely severs an umbilical cord and is designed for use in developing countries where childbirth carries high health risks. His device won this year’s IDEAPitch, an Idea Village-founded event sponsored by Silicon Valley private equity giant TPG.
Or look to NanoFex, which won a $50,000 “Water Challenge” competition, financed by the Greater New Orleans Foundation to encourage development of new water management solutions. NanoFex came up with a way to use Louisiana sugar cane and crawfish shells to purify contaminated groundwater.
The list goes on. There is Big Easy Blends, a packager of frozen cocktails that recently won $350,000 in venture investment; and LifeCity, a membership organization that supports the development of green businesses in Louisiana. Then there’s SensPack, a low-cost mobile medical tool for monitoring and analyzing a host of health indicators and alerting at-risk individuals to problems.
New Orleans suddenly is crawling with entrepreneurs, buzzing with creative energy and turning heads in big-money circles. Can this be the same city that for decades fretted over losing its best and brightest as local college grads sought more promising futures elsewhere?
Believe it, says Michael Hecht, president and CEO of the business development organization Greater New Orleans Inc. “You can look around and just see it and feel it,” he says. “The city seems to be teeming with new, young, diverse people.”
Since business advocacy is part of Hecht’s job, he might be forgiven for excessive optimism about the entrepreneurial climate. But in fact, his is far from the only voice declaring that New Orleans has stanched its long-lamented “brain drain.”
A recent Inc. Magazine article, entitled “Why New Orleans is the coolest start-up city in America,” names one fledgling business after another that hatched and is being nurtured here. “New Orleans isn’t Silicon Valley yet, but give it some time,” wrote Donna Fenn.
And how about Site Selection magazine naming New Orleans one of its Top 10 Metro Areas for corporate facility location? The magazine paid further tribute to the city in an article entitled “The New Orleans Miracle.”
But the most gratifying declaration may have come from Forbes magazine. Early this year the magazine released an analysis of college graduates in cities around the country, and – are you ready? – it ranked New Orleans No. 1 among “America’s Biggest Brain Magnets.”
The magazine came up with its ranking by examining gains in the number of people with college educations compared to a city’s population over 25 years of age. The analysis of data from the American Community Survey covered the 52 largest metropolitan areas (with a population of more than 1 million) during the period 2007 to ’09. The survey showed that greater New Orleans had gained nearly 37,000 college graduates.
“When you get analytic evidence from people who have looked at the raw numbers, then you know that what you are seeing is in fact real,” Hecht says.
Of those who have looked at the influx of talent, few would argue that the trend wasn’t rooted in disaster. Events that befell New Orleans after Hurricane Katrina awakened in many locals an urge to build and innovate; it sparked an excitement about the potential for positive change.
The catastrophe also touched the hearts of people around the world and produced a groundswell of goodwill toward the city. The surge of interest drew attention to New Orleans’ inherent assets, including its cultural richness and diversity – qualities that well-educated young people tend to find compelling.
“A lot of young people in New Orleans are discovering that they can come to this place, make a difference and have a great time here, and that seems to be very attractive,” Hecht says.
And it isn’t just the news media who are taking notice of the city’s business vibe. Hecht frequently talks with business consultants who scout cities where corporate clients may want to expand or relocate, and he says more and more companies in “young” industries such as digital media are considering the Crescent City.
“They’re mentioning New Orleans in the same breath with cities like Austin [Texas] and Seattle,” he says.
When relocation consultants visit New Orleans, Hecht likes to take them to visit the IP (Intellectual Property) building, a downtown business incubator and office space that Greater New Orleans Inc. helped launch. “We started with a couple of companies and a vague idea,” he says. “Now there are about 14 companies in the incubator, and well over 60 companies operating in the building.”
The IP building’s success has led to the development of other, similar business hubs around the region. But as encouraging as Hecht finds all the entrepreneurial energy, he’s also cautious about declaring New Orleans’ brain drain permanently plugged.
“Young people have come here because of the opportunity and the excitement,” he says. “But over time, if they want to stay and have families here, they’re going to have to have enough quality jobs to make that choice.”
Hecht says the challenge New Orleans faces is to ensure that after all the post-Katrina rebuilding money is spent, the city can offer the jobs and quality of life that will sustain business growth. The struggle to hold on to gains the city has made and continue to advance won’t be easy. “But the nice thing is, we stand a chance of actually winning,” he says.
Seedlings, sprouts and ventures
10 of the manybusinesses that hatched in New Orleans in recent years.
Big Easy Blends
Pre-mixed alcoholic beverages packaged in a flexible pouch.
Develops measurable, motivating tools that foster physiological and emotional wellbeing.
Drop the Chalk
Data tracking and management tools for use in charter schools.
Federated Sample LLC
A market research technology and data mining company.
Take-out and delivery pizza made with whole-food ingredients.
NOvate Medical Technologies LLC
Medical device development company focused on commercializing low-cost medical products.
Provides sports and specialized entertainment opportunities through organized team sports and social outings.
Rare Cuts Gourmet Meat Market
Offers high-quality cuts of meat in an online marketplace.
Connects individual lenders and financial institutions with businesses that need capital.
The Receivables Exchange LLC
An electronic marketplace where businesses can sell their receivables for cash.