The Startup Ecosystem

Don Taylor, PhD, MBA, CLP is the co-director of the Center for Commercial Applications of Healthcare Data where he guides investigators developing digital health technologies at the University of Pittsburgh – working across innovation and entrepreneurship groups at the university and the broader region. We sat down with Dr. Taylor to get his perspective on the ever-evolving startup ecosystem, how entrepreneurs can leverage resources, and what makes Pittsburgh’s startup ecosystem thrive.

What is a startup ecosystem? What should an entrepreneur look for in it?

I think of a startup ecosystem as I would think of a biological ecosystem – that of interconnected components that form a community serving individual and common purposes. A key to an ecosystem is that the purposes of the individual things have a net positive effect on the purpose of the community.

So just as one can imagine your favorite local pond in the spring, all of those organisms are individually working hard to survive and to flourish and when they do, the pond becomes a beautiful expression of the whole being greater than the sum of the parts.

In the world of startup ecosystems, it’s much the same as in a pond. They have as their components people, ideas, capital, investors, big companies, small companies, universities, and more. Each depend on the other and the better they are aligned to common goals and purposes, the better the outcomes.

Entrepreneurs should first look toward that community purpose and assess for themselves if there is a broader context, intentional purpose, and commitment from the region to support their individual purpose.

Is there a life cycle to startup ecosystems? Where do you see them ending/evolving and others starting?

As with biological ecosystems, there are life cycles, and startup ecosystems are much the same. I believe the healthiest ones hold the broader community’s best interest in mind and do so with diversity, equity and inclusion as deliberate and essential elements. As needs and gaps may change and evolve, the best ecosystems adapt and pull together as a community to find the right solutions.

We can also consider the lifecycle of individual entrepreneurs and companies. Entrepreneurs need different resources at different times. For example, a first-time startup CEO may require significant mentorship from a diverse group of advisors and board of directors, so experienced management becomes a necessity. Perhaps a non-technical founder is in need of a team of engineers to help design and build a new water treatment innovation, and so an experienced technical workforce is needed.

We can also contemplate startup ecosystems segmented by their markets and ask which may be maturing (and possibly in need of an inflection of new support resources) and which are up and coming. The up and coming startup markets that I see in Pittsburgh are numerous and include markets for drug discovery companies (Globin Solutions) and AI in digital health (SpinTellx). Perhaps more mature startup markets for Pittsburgh include medical devices and robotics, as Pittsburgh has a strong foundation of these technologies dating back decades.

What makes Pittsburgh’s startup ecosystem thrive? Where does it excel and where could it use more support?

The Brookings Institution published a report in 2017 detailing the many strengths of the Pittsburgh innovation ecosystem and recommendations for growth. Although this Brookings report addresses broader topics for innovation districts, it does address the Pittsburgh startup ecosystem. For example, the report mentions a growing base of large companies and strengthening startups (e.g., PNC, UPMC, Google, Uber, Duolingo, and others). This is important because attracting and retaining top talent (from skilled workers to seasoned startup executives) relies in part on a healthy base of incumbent companies.

The report also points to emerging strengths in Pittsburgh’s support systems such as a network of startup mentors, flexible workspaces, investment dollars, and recruiting talent to the region. Yet, with the emerging strengths in Pittsburgh, the report conveys that “the entrepreneurial ecosystem has yet to produce a significant number of high-growth startups” as compared to peer cities such as Denver, Austin, and Atlanta. Fueling an ecosystem for high-growth startups is a priority and is precisely an area of focus for the Pittsburgh Health Data Alliance, among other regional innovation initiatives.

As a 25+ year veteran in life sciences startups in Pittsburgh, I see Pittsburgh thriving on recent advances in attracting and retaining top talent across important disciplines such as technology, business, finance, and government relations, and more. We hear a lot about Pittsburgh needing more investment capital to fuel the innovation pipelines – and that’s true, we need that. Where I also see high-value opportunities for Pittsburgh’s startup ecosystem to further thrive is two-fold:

• Work even harder to pull our community together around a shared vision and purpose for startups and –
• Do an even better job telling the world about the abundant accomplishments and potential we have here.

Where is Pittsburgh headed given the current state of its startup ecosystem?

For startups, Pittsburgh gets better and better each year and that benchmarking goes back a while. I launched my first Pittsburgh startup in 1993 as a computer science student at Carnegie Mellon University. Since then, I’ve been with four other startups in Pittsburgh and mentored over 50 Pittsburgh-based startups during my time with a local economic development firm (Pittsburgh Life Sciences Greenhouse).

Today, the state of the Pittsburgh startup ecosystem is poised for even more growth as I see the expansion of wet lab space such as through LifeX Labs, more venture capital firms lining up to invest in earlier-stage technologies from local universities such as the University of Pittsburgh, Carnegie Mellon University, and Duquesne University, among others, and a growing network of C-level executives with a depth and breadth of startup experience moving to the region.

What’s certain is that there will be more change in Pittsburgh. This change will bring about new people, new perspectives, and new sources of innovation and entrepreneurship to support Pittsburgh as a leading region of excellence for supporting the startup and broader community.