Every community is different, which means that every community presents different options and opportunities for growing your business. Like purchasing a house in the right neighbourhood, expanding your business in the right community can pay dividends.
What sort of things should you consider when looking at different ecosystems? The three biggest factors in choosing the ecosystem that is right for you are the local business community, the size of the community and related community assets.
Local Business Community
When evaluating an ecosystem the first factor you should consider is whether the local business community aligns with your company’s growth plans. Why?
Local business leaders are the people you’ll interact with on a regular basis, they’re people you’ll be able to ask for advice and local companies may even represent opportunities for partnership.
If your industry makes up a larger percentage of the local economy, you are more likely to see efforts to retain your business, including new infrastructure, transit or talent attraction and retention campaigns that align with your needs.
This is related to cluster theories, including work by Michael Porter, which suggest that a concentration of similar types of businesses in one space can help companies within that cluster increase productivity. If you own a tech company and you choose a location where manufacturing is the predominant industry you are less likely to gain these benefits.
Size of Community
The size of the community you join can be one of the biggest determinants of your success. Bigger centres generally come with larger business communities, greater access to capital and more talent. However, bigger isn’t always better: those same communities usually have more competition for talent and much higher costs.
Smaller communities can offer lower costs, but less access to capital resources and support organizations. However, if the business community – and existing business supports – aligns with your type of business, the community’s scale may not matter.
Waterloo, for example, is a midsized city with particular strengths in tech – including automotive technology, artificial intelligence and security – and advanced manufacturing – including automotive and aerospace. While we lack the sheer scale of larger centres, the density of our business community, proximity to premier talent sources and lower costs make us a very competitive option.
When you add in a business culture that is very welcoming to new entrants and our close proximity to major markets like Toronto, our community reveals itself to be the type of place where you can have your cake and eat it, too. Our size isn’t an impediment and is, for many companies, a benefit.
Related Community Assets
A deep network of support organizations committed to helping your company grow often bolsters the performance of the most highly productive business environments. These support organizations include research centres, incubators, accelerators and academic institutions that have the resources to give your business an edge on the competition.
When choosing a new location, it is imperative that your company evaluates the support organizations in each community, their focus, relative costs, etc. It is not advantageous to land in a new community where all of the support organizations are geared towards a different industry, have prohibitive fees or simply don’t have the resources to meet your objectives.
Contact the Waterloo EDC team. We’re here to help.