By Scott Meacham
Copyright © 2018, The Oklahoma Publishing Co.
In entrepreneurship, just like anything else, ratings and rankings are important, if for no other reason than they help shape how we view ourselves. Therefore, it’s important to know how Oklahoma stacks up to other states, especially states that are most like us.
Oklahoma was recently ranked No. 5 in WalletHub’s Best States to Start a Business. Building an innovation economy is arduous. It takes decades, so it’s always encouraging and reinforcing to receive good results from credible and impartial outside sources.
The WalletHub assessment compared all 50 states in terms of business environment, access to resources, and business costs. Inside these categories, calculations included measures such as the state’s share of fast-growing firms, five-year business survival rates, access to human talent, capital and taxes, cost of living, and sources of financing and capital.
In short, Oklahoma ranked fifth on a comprehensive list of the most important factors that contribute to a successful ecosystem for new business creation in any geography. That’s a true accounting of this state’s investment in its innovation economy.
And there’s more data underscoring Oklahoma’s progress.
The 2017 Kauffman Index of Growth Entrepreneurship, a series of research-based annual reports that measure U.S. entrepreneurship based on a variety of factors, provides a robust comparison of trends by state. (States are divided into two peer groups based on population. Oklahoma falls in the category of 25 smaller states.)
Kauffman says it is a misperception to believe these days that to attract sufficient venture investment to scale, entrepreneurs have to live in Silicon Valley, New York City, or Massachusetts.
While these locations do attract a disproportionate share of venture dollars invested, the story is different when it comes to the number of deals, as nearly 50 percent of the deals in the U.S. happen outside these three states. Notably, states like Georgia, Virginia, Nevada, and, yes, Oklahoma, have been seeding, supporting, and growing their own entrepreneurial ecosystems and startup pipelines. The rest of the country is recognizing these results
In the Kauffman study, Oklahoma’s peer ranking is No. 2 in Startup Activity and No. 1 in the Rate of New Entrepreneurs, with 450 out of every 100,000 adults becoming entrepreneurs every month. Impressively, Kauffman’s measure of how much Oklahoma’s startups have grown on average five years after founding calculated based on employment is nearly 57 percent. You can think of that as new companies turning every six jobs into nine.
We tend to hear about the big events — exits like WeGoLook and Selexys or huge capital investments, like Tetherex Pharmaceutical’s recent $50 million round ($43 million of which came from i2E and other Oklahoma investors).
But we need to hear more about the hundreds of activities and success that have aggregated over the last two decades to form the entrepreneurial ecosystem here.
The innovation economy in Oklahoma is an economic force that is validated by industry analysts, investors from other states, and entrepreneurs who are coming home or moving to Oklahoma for the first time to start their new business. They see the proof — and the potential.
Oklahoma is a great place to start, scale and grow a new company.
Scott Meacham is president and CEO of i2E Inc., a nonprofit corporation that mentors many of the state’s technology-based startup companies. i2E receives state support from the Oklahoma Center for the Advancement of Science and Technology and is an integral part of Oklahoma’s Innovation Model. Contact Meacham at [email protected].