Late last year, Techstars announced a new location with a previously uncharted market focus, for an accelerator. Techstars Mobility, a Detroit-based branch of the accelerator, will focus on the mobility and transportation industries. Techstars Mobility is sponsored by Ford, Verizon, and Magna. While these companies are putting up the money to make Techstars Mobility a reality, they also bring a great amount of experience and success within the field:
- Ford, one of the leading innovators in the industry since it’s inception who continues to lead with a focus on mobility and transportation under the direction of Bill Ford;
- Magna International, one of the largest automotive suppliers in the world with connections and distribution channels to virtually all auto producers and into other transportation industries;
- Verizon Telematics, who puts the connected in connected car with their terrestrial and satellite based communication solutions.1
While we are a little late covering the new program, we wanted to highlight the uniqueness of the situation in Detroit. The formation of Techstars Mobility is just the latest event in what could be called Detroit’s economic renaissance. It all began way back in 2007 when Daniel Gilbert, the Chairman and CEO of Quicken Loans, moves his 7,000 employees from the suburbs to downtown Detroit. Since the move, Gilbert has purchased more than 15 buildings and several parking garages.2 Quicken Loans’ move to Detroit represents much more than several real estate transactions, it marked the formation of what would become the heart of the new Detroit. Quicken Loans provided a much needed anchor company for the struggling city.
After Quicken Loans moved in, other smaller companies began to follow suit. It took time and work, but it finally began to pay off in the summer of 2014. On 12 June 2014, Detroit Mayor Mike Duggan announced the formation of the Detroit Innovation District.3
The Detroit Innovation District (DID) is officially designated by the city, supported by the state, and governed by stakeholders from anchor institutions, the private and civic sectors. The District represents Detroit’s best potential to grow population and jobs in a way that both stimulates innovation and brings real value to residents and neighborhoods.4
Thus far, much of the Detroit Innovation District’s growth has been organic. However, with Techstars Mobility set to bring in 10 startups this June, there will be some fuel added to the fire. You can still apply to be a part of Techstars Mobility until March 15, 2015.
The rebirth of Detroit is just a small part of the overall growth of these innovation districts in the U.S. It makes a lot of sense. As the nature of work is being rapidly transformed, the city is not nearly as important of an economic driver as it once was. You no longer have to go to an office every day to work. Thus, metro areas are having a hard time with employment and drawing in companies, these innovation districts offer a unique opportunity for cities. Bruce Katz and Julie Wagner, of The Brookings Institute, published an in-depth look at the rise of these districts last summer. In the research, they pointed out several major reasons why cities have begun to adopt the innovation district:
Innovation districts have the unique potential to spur productive, inclusive and sustainable economic development. At a time of sluggish growth, they provide a strong foundation for the creation and expansion of firms and jobs by helping companies, entrepreneurs, universities, researchers and investors—across sectors and disciplines—co-invent and co-produce new discoveries for the market. At a time of rising social inequality, they offer the prospect of expanding employment and educational opportunities for disadvantaged populations given that many districts are close to low- and moderate-income neighborhoods. And, at a time of inefficient land use, extensive sprawl and continued environmental degradation, they present the potential for denser residential and employment patterns, the leveraging of mass transit, and the repopulation of urban cores.5
- Dave Drach, Techstars Blog, “Techstars Announces Techstars Mobility, Driven by Detroit,” 11 December 2014 ▲
- Joan Mooney, Urban Land Magazine, ““Innovation Districts” Boosting Bottom Line for Cities,” 5 August 2013 ▲
- Natalie Broda, Crain’s Detroit Business, “Detroit launches Innovation District to spur job growth,” 12 June 2014 ▲
- Bruce Katz and Julie Wagner, Brookings, “THE RISE OF INNOVATION DISTRICTS” ▲
- Bruce Katz and Julie Wagner, Brookings, “THE RISE OF INNOVATION DISTRICTS.” This is more of an interactive presentation of their longer, more detailed research paper: Bruce Katz and Julie Wagner, The Metropolitan Policy Program at Brookings Institute, “The Rise of Innovation Districts: A New Geography of Innovation in America,” May 2014 (PDF) ▲