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By Brian Matthews, Managing Director of Cultivation Capital
2015 was another great year for increasing the footprint and impact of the Innovation Community on the fabric of Downtown St. Louis. Due to the continued rise of innovative companies and workers within the downtown area, Downtown STL, Inc, in conjunction with T-REX and entrepreneurs throughout downtown area announced the formation of the Downtown Innovation Community.
The Downtown Innovation Community will focus its support in the areas of physical assets, economic assets and marketing to support the growing Downtown innovative ecosystem with a stated goal of having 1,000 innovative companies and 10,000 workers Downtown by 2025.
The 2015 innovation community impact could be felt Downtown in three important areas: real estate, invested capital and jobs. Additionally, new companies Downtown and corporate support helped fuel the district’s growth.
Although not increasing the overall footprint that we expect to see over the next five to ten years, there were some important announcements made regarding real estate within the Downtown Innovation Community.
- The recent opening of the Arcade Apartments with 282 units will result in a noticeable increase in the amount people living and working Downtown.
- Other important real estate announcements for the innovation community included Less Annoying CRM (Old Laclede Gas building), Rovertown (316 N 8th St.), LockerDome (moving to Fitness Factory Space on Washington Ave. in 2016), and T-REX’s announcement of its $8 million fundraising campaign to add 40,000 sq feet at its 911 Washington Avenue address.
- Industrious, a new co-working space opened with 11,000 sq. ft. at 555 Washington Ave.
- T-REX had over 130 companies and 350 members working in the facility at the end of 2015.
- The St. Louis Fashion Fund announced in November that it will open its Fashion Fund Incubator in the Art Lofts at 16th and Washington in the fall of 2016.
There were many highlights on the fundraising front in 2015.
- Both the Prosper Women Entrepreneurs Startup Accelerator and Stadia Sports Accelerator launched at T-REX. Prosper invested in 11 companies and Stadia invested in 4 companies.
- The SixThirty FinTech Accelerator added Atul Kamra, formerly Head of Advice at Wells Fargo Advisors, as managing director and added UMB, EY, and RGA as corporate sponsors which increased the 2015 funds invested to a total of $1.25 million in nine companies.
- Cultivation Capital announced the formation of its second Tech Fund with a goal of $40 million in capital to be invested over five years. Cultivation Capital invested almost $6 million in 7 Downtown St. Louis companies in 2015.
- Some of the more notable Downtown-based company capital raises in 2015 were: TopOpps ($3.6 million), Tunespeak ($2.0 million), Hatchbuck ($1.38 million), Juristat ($1.2 million), Fluent ($875,000), Rovertown ($875,000), Gremln ($721,000), Pixel Press (TBA), FoodEssentials/LabelInsight (TBA), and FinLocker (TBA). The other big news on the invested capital front was the purchase of Downtown St. Louis-based Asynchrony by World Wide Technologies (WWT). It was announced at that time that Asynchrony Labs, a division of WorldWide Technologies, would remain in Downtown St. Louis.
The Downtown St. Louis Innovation Community ended 2015 with over 250 innovative companies and over 3,000 employees working Downtown. A few of the larger job announcements in 2015 included:
- KPMG will hire 175 technology positions and LockerDome will hire 300 additional employees over the next five years.
- T-REX members grew from 220 members at the end of 2014 to 350 at the end of 2015.
- Some of the notable graduates from T-REX in 2015 that remained Downtown and are increasing jobs include Rovertown, Need/Want, Less Annoying CRM and The Normal Brand.
New Downtown Companies
Each year there are some new companies that burst onto the Downtown scene that begin to catch the eye of potential investors and future employees. New Downtown companies in 2015 of note include: ProsperSTL, Stadia Ventures, Garbshare, FocalCast, OPER, Invisible Industries, TapTL, Benjamin and PromisePay.
Corporate financial support of non-profit organizations such as Arch Grants, GlobalHack, T-REX, and ITEN continues to grow. Notable supporters for 2015 include: Purina, AB Inbev, CenturyLink, Morgan Stanley, Emerson, World Wide Technologies, US Bank, Pulaski Bank, Scottrade, The Laclede Group and Mastercard.
- There will be at least two corporations located outside of the city that move to Downtown St. Louis or open offices Downtown in order to attract higher quality millennial talent.
- The Chemical and/or Jefferson Arms buildings will begin rehabilitation in 2016.
- Another new accelerator launches at T-REX.
- Over $50 million will be raised by Downtown-based innovative companies.
- The Downtown Innovation Community adds at least 25 companies and 500 people.