THE BETA CITY THE CITY AS A BUSINESS MATCHMAKER AND TESTING GROUND INNOVATIONS CASE NARRATIVE: ANTWERP, BELGIUM BART DE WEVER AND EVERT BULCKE Antwerp, Belgium was the winner of the 2015 Startup Nations Award for Local Policy Leadership. Through our work, we have come to the conclusion that nurturing an entrepreneurial mindset in a city has a very healthy effect on economy and society. With industrialization and the subsequent rise of the service economy, the 20th century witnessed the introduction of a new center of gravity—the corporation. Inventions were no longer strictly the domain of science and academia. Corporations became hubs and drivers of innovation and have been instrumental in virtually all technological breakthroughs since the 1950s.1 These advancements led to ever more generations of consumer products and electronics. The rise of the corporation over this period Alphabet (Google), Apple, Microsoft, and also had a tremendous social impact. With Facebook. With a combined stock value corporate dominance came corporate life: four times that of the four largest firms just the way we defined work, the way we 20 years ago, these companies are the most defined time off, the educational choices we valuable in the world.2 Whether it concerns made, the roles we attributed to youngsters new products, new ventures, new kinds of and to the elderly, the way we balanced life, jobs or job titles, we tend to observe and fol- work, family, and leisure. In short, almost low their every move. every aspect of life was fundamentally influenced by the way people functioned within the corporate structure. NOT ONLY INDUSTRIES GET DISRUPTED This gravitational pull has culminated today in the global dominance of a small number However, this 20th-century corporate logic of very large technology companies, such as ends there, and it ends abruptly. The young 38 innovations / Thriving Cities Downloaded from http://direct.mit.edu/itgg/article-pdf/11/1-2/38/705200/inov_a_00246.pdf by guest on 29 September 2021 The Beta City 21st century has already seen wave after business with one goal in mind: to create wave of change: cloud storage, mobile, the value in the new digital world where a few Internet of Things. The very technologies Goliaths fear a multitude of Davids known that sprang from corporate Silicon Valley as startups. have given birth to a new business culture that is establishing entirely new standards Startups, spinoffs, spinouts, scaleups— in what we call the age of disruption. although these terms have been around for ages, they’re now in the spotlight across the Information technology, or IT, has evolved globe. Perhaps due to the lack of heavy hier- from being just one of many industries to archical structures and corporate agendas, become a paramount factor in innovation. the founders and employees of these new Digital technology in the age of disruption firms sport a highly creative mindset and an has fundamentally altered advertising, ability to think outside the box. While they media, retail, travel, and, more recently, implement scalable new business models banking, insurance, health care, logistics, based on state-of-the-art technologies, the human resources, consulting, education, tools of their trade are simple: a couple of and government services.3 laptops and basic IT skills. If we zoom in to consider this disruption These small emerging companies—let’s call from a macroeconomic perspective, we find them startups—behave differently on many one common denominator across the new levels. They tend to have a slight structure, business landscape: while the underlying often starting out as projects, and avoid technologies hail from large academic or classic organizational hierarchies.5 Team corporate innovation centers, disruption chemistry is a critical asset and is often thrives in individual cells and among select regarded as more important than the choice groups of people. This is largely because of what product to develop. These compa- small companies find it easier to exploit the nies’ endeavors have less to do with pursu- possibilities of swift technological change.4 ing a passion than with the opportunities available in a particular sector, and are The digital revolution has dramatically low- increasingly the result of a deliberate busi- ered the cost of technology and product ness-building process within a university or development, which in turn empowers private incubator. Founders and team small companies to develop new products members are totally committed to their and new platforms, and to alter the domi- companies, making themselves available at nant business model. In fact, a whole new all times. They often retreat to bars during entrepreneurial generation is looking to do ABOUT THE AUTHORS Bart De Wever is the Mayor of Antwerp, the largest city in Flanders, Belgium. He has been General Chairman of the New Flemish Alliance since 2004 and has served as a representative in several of the country’s parliaments. De Wever studied history and has worked as an assistant at the University of Leuven. Evert Bulcke currently serves as Chief Strategy Officer at Rombit, a smart city and smart industries technology company based in Antwerp. He is the former Project Manager of Antwerp Startup City. © 2016 Bart De Wever and Evert Bulcke innovations / volume 11, number 1/2 39 Downloaded from http://direct.mit.edu/itgg/article-pdf/11/1-2/38/705200/inov_a_00246.pdf by guest on 29 September 2021 Bart De Wever and Evert Bulcke work time, where they contemplate compa- local governments can turn a city into a ny and other related issues. This is not a startup haven, and Antwerp is proof of this case of laissez-faire; it is simply a different idea. We will offer examples of how way of doing business, sparked by the Antwerp—known for its diamond trade, younger generation’s disregard for formal port activities, and one of the world’s largest structures.6 petrochemical clusters—has cultivated its startup culture and entrepreneurial net- In media mentions of startups, the cliché of works. the 20-something male developer often appears to be true, but the startup hype has With leading cities such as London, inspired other businesses and demographic Amsterdam, and Paris within a 200-mile groups to adopt this new culture. Large radius, Antwerp was not exactly the go-to companies are now opening their own incu- place for innovative business development bators, sponsoring startups, and supporting or smart city activities until recently. In fact, innovation camps and “hackathons.” startups and innovation were hard to find in Sometimes they even house small groups of our city, and other Belgian cities such as staff members in the immediate vicinity of Brussels and Ghent were well ahead in pro- creative hubs in the hope that the startup viding a hospitable startup atmosphere and way of life might rub off on their own claiming a place in the second tier of inno- employees. vative cities in Europe. However, it’s no longer just industries that The scales started to shift in 2013, due to the are being disrupted but the whole economic media buzz about the successful introduc- ecosystem. We are witnesses to a paradigm tion of two privately owned incubators in shift in which the formal corporate society Antwerp’s city center. The new city council is making way for a complex informal net- that came to power at the same time work society that consists of these small renewed local interest in economic develop- cells. This paradigm includes the belief that ment, and it formed a small team within the anyone of any age can do business, regard- public service administration called less of his or her academic background, Antwerp Startup City. This group was thanks largely to the immediate availability charged with stimulating and nurturing of affordable digital technology. entrepreneurial activity within the city. The approach was simple yet unique: (1) facili- tate whatever initiatives may spring from ANTWERP: THE CITY AS A the private sector in the Benelux region; (2) BUSINESS FRAMEWORK promote their activities to the broader busi- ness community; and (3) fill in the gaps From a government perspective, the natural wherever necessary. question is what the ideal environment is for this emerging business culture to thrive. This is an entirely different approach to the usual workflow of local governments, which Enter the city. tend to meticulously plan and map out From our experience in Antwerp, Belgium, future activities without much flexibility. we are convinced that cities are the ideal Moreover, most local governments set out breeding ground for cultivating startups to own the projects, often ignoring more and inducing a startup mentality in differ- effective and cost-efficient initiatives. ent groups of people. Cities essentially func- Considerable time and effort were invested tion as dense networks of cells, and by offer- to help Antwerp Startup City become a ing these cells the right “ingredients” a city knowledgeable and supportive partner to can create a thriving environment for entre- local entrepreneurs and, more importantly, preneurship. In fact, we are convinced that 40 innovations / Thriving Cities Downloaded from http://direct.mit.edu/itgg/article-pdf/11/1-2/38/705200/inov_a_00246.pdf by guest on 29 September 2021 The Beta City to its becoming a business matchmaking which reinforces the vibrant atmosphere platform. When a lot of different initiatives and makes the need to reach the incubators arise and many small companies seek to do by car largely irrelevant. Ann Mettler, for- business, they want an unbiased, credible mer executive director of the Lisbon partner. The city’s startup team happily Council, noted that “all the cool companies filled that role, carefully anticipating and in Silicon Valley are moving up from the monitoring any competition issues startups valley into the center of San Francisco.