CEDAR FALLS, Iowa — If agriculture dominates conversations about Iowa’s business potential, information technology is getting in at least a few words, according to a tech magazine’s latest findings.
According to Fast Company magazine’s latest innovation rankings, Iowa was 46th among the 50 states and the District of Columbia, but No. 1 in the nation in revenue per startup.
Nos. 2 through 5 were Maine, Florida, Ohio and New Jersey.
In one sense, the numbers weren’t a surprise, said Dan Beenken, director of the University of Northern Iowa’s Small Business Development Center and manager of UNI’s Innovation Incubator.
“Iowa and the Midwest in general is a fairly risk-averse environment,” he said. “Northern European ancestors are known for not rocking the boat. Typically I feel launching a startup isn’t in our genes. So, consequently, on a per-capita basis, we don’t have a large startup scene.”
On the other hand, he said, entrepreneurs who find an idea they think will work tend to see it through to success.
“That may be part of the whole spectrum there,” he said. “It’s saying we’re not very innovative, vs. our 49 peers, but the ones that do make it do well. That speaks to our work ethic and our risk-aversion a little bit. People dip their toe in the water; they don’t just quit cold turkey.”
Iowa, as well as the Cedar Valley, abounds in successful startups, and pure statistics may be a bit deceiving, said Chad Feldmann, founding partner in Cedar Falls-based Far Reach, a six-year-old IT firm.
“I’d think it would have to do with the kind of startups they’re trying to push in Iowa,” he said. “I recall in Iowa there’s a focus on certain types of manufacturing and green energy — all those things they’re trying to promote in TechWorks, and we’re probably seeing some success across the state.”
California usually ranks at or near the top of any list of states with IT-related startups, and that’s also a bit misleading, Feldmann said.
“Anybody who has succeeded in a start up out there has probably failed in 10 more; that’s my understanding,” he said. “Here, it seems like if you fail, because so few people are trying, when you do fail, you fail maybe a little more miserably than others. People can’t get their minds around failing at a startup and how can they do it again?”
Entrepreneurs in Silicon Valley and elsewhere have plenty of exemplars to follow, and advice is abundant, which also is a key component for startups, Feldmann said.
“We don’t have a lot of startups around here, so you don’t have a lot of meet-ups here, which is why we’re doing Startup Drinks and TechBrew,” he said. “We’re willing to share and bounce ideas off each other and make each other better.”
There are plenty of entrepreneurs in the Cedar Valley, Feldmann said.
Indeed, two of them — UNI chemistry professor Bill Harwood and retired Cedar Falls firefighter Mike Whitson — launched iTracking Research Inc. a year ago. The pair founded their company based on research they did at UNI on the effectiveness of eye tracking for assessing visual cognition and website usability.
“It’s a long and exciting walk, I think, but we’re doing all right to start with,” said Harwood, whose company operates out of UNI’s business incubator.
The company has had a successful first year, Harwood said, although he declined to discuss specifics.
“Our next hurdle is we’re going to be looking to hire a few people and increase sales,” he said. “We’ve done all the foundational work, and now we’re going to start ramping up more and more and try to avoid all the mistakes we hear about startups and how they can go awry in different ways.”