Chattanooga’s business renaissance thrives off new, entrepreneurial ideas
The word “renaissance” commonly conjures up visions of the great art masters da Vinci, Michelangelo and Raphael. In their time they revived an interest in classical form and beauty. Something most had thought long gone was brought back by a handful of progressive thinkers, who took those old ideas to a new level and a new audience. In many ways, Chattanooga is experiencing a renaissance in business.
“We’re reclaiming a part of our legacy,” says Mike Bradshaw, executive director of The Company Lab, better known as Co.Lab. “We talk about old manufacturing being replaced by a new wave of business. What’s ironic is that this technology has also produced new ways of manufacturing.” Bradshaw is referring to the time when Chattanooga was known as the “Dynamo of Dixie.” From the late nineteenth century and through most of the twentieth, the Scenic City’s scenery consisted of smokestacks, train tracks and smog. Because of Chattanooga’s central location, easy access to roads and rails and a willing workforce, hundreds of manufacturers called it home.
But while the industries of the valley created wealth, it didn’t come without a great price. In 1969, a precursor of the Environmental Protection Agency announced that Chattanooga had the worst air quality in the country. Throughout the 1970s, city officials worked with industry leaders and created a plan to reduce pollution levels. The effort was helped along by the fact that many of the industries that called Chattanooga home were waning in the face of cheaper off-shore competition. Chattanooga had to re-invent itself.
Today, there are three organizations in Chattanooga whose sole purpose is to create a fertile environment for entrepreneurs: nurseries for birthing new businesses and, in some cases, entirely new technologies. Each uses a slightly different methodology and each has a different structure and primary focus. But each has a track record of helping get new ideas from inception to production.
The first of these has been around since the early 1980s: the Hamilton County Business Development Center (BDC), now better known as the INCubator. A program of the Chattanooga Area Chamber of Commerce, the INCubator is housed in an old 1920s factory at the corner of Cherokee Boulevard and Manufacturers Road. More than 500 businesses have been nurtured through the year-year process. Right now, there are more than 70 businesses with about 400 employees at various stages in the incubation process. Business owners benefit from professional mentoring, lower-than-market rent, shared administrative resources and free onsite counseling from the Small Business Administration. The BDC is not only Tennessee’s largest business incubator, but the third largest in the United States. (Editor’s note: The Pulse was incubated at the BDC.)
“The thing to do is sort of ‘prototype’ your business as quickly as you can,” explains Co.Lab’s Bradshaw, “and see if you can develop a real fit between your value proposition—those things you say you’re going to do for people—and people who would want this.” That’s the step-off point for Co.Lab’s burgeoning businesses. The Company Lab is a nonprofit business incubator funded by private foundations such as Lyndhurst and Benwood. “I think this city, in particular, has just this willingness to engage in [helping start-ups] for no other reason than they think it’s the right thing to do,” says Bradshaw.
Co.Lab recently moved into larger quarters on Market Street, a sign of their success. One afternoon last week, I was sitting in one of the mini-conference areas in their new home and Bradshaw pointed out a group of about ten business professionals from some of the most impactful companies in Chattanooga coming in to discuss business with some of Co.Lab’s innovators. “We have to be nimble and adaptive in the extreme,” says Bradshaw, “And we’re surrounded, and all start-ups are naturally, operating in an environment of radical uncertainty without the resources to control the adventures the environment might supply to them.”
Bradshaw says Co.Lab uses the scientific method, or more accurately the “Agile Start-up Development Method,” to jump-start an entrepreneur’s entrance into the business world. “That’s what we’re all about...smart people getting together and doing things.”
Interestingly enough, it was the downfall of the mills, factories and foundries that led to the cleaning up of the local environment—and the cleaner environment has led to the arrival of some of the city’s most innovative thinkers. A universal point of agreement exists between all involved in growing business that Chattanooga’s new reputation as an outdoor adventure destination has a direct impact on the type of businesses being born here. Bradshaw says when he and his wife were looking for a place to live, having come first from New England and most recently Knoxville, Chattanooga’s ample recreational resources played a major role in attracting them. He tells The Pulse there are “idea people” out there that visit Chattanooga for the fun and stay here for the business environment. It’s as likely that new business ventures are discussed on a mountain bike or climbing a rock face as sitting at a table in a restaurant knocking back cocktails.
“We had this issue where young people would graduate from school here and then they would leave and go other places,” says U.S. Sen. Bob Corker. “And I knew one of the things, especially during that time, that really attracted young people was being able to be outdoors.” That was his epiphany in 2001, when he was mayor of Chattanooga. He recalled traveling the country as a contractor and seeing how many young professionals were settling in places like Boulder, Colorado. Years later, it became a cornerstone of his administration to make Chattanooga youth-friendly in hopes of retaining some of the enthusiastic forward-thinkers in the area. So he built upon the work started by former Mayor Jon Kinsey in creating a better Scenic City. Kinsey’s philosophy was that city government didn’t have to do everything to create a better business environment. In this view, city leaders should just set the stage for attracting go-getters and then get out of their way.
“The change in culture was one where we began to take our river seriously,” explains Weston Wamp with the Lamp Post Group. “We began to take, more seriously, the climbing and hiking assets that are in not just the city, but in the surrounding areas.” Wamp’s Lamp Post Group is the third, and newest, of the the three incubators in town, but already has a list of success stories, including Bellhops, Steam Logistics, Fan Jam and the Chattanooga Whiskey Company.
The Lamp Post Group is a business incubator like the other two, but as Wamp explains it, they have a different strategy and structure. “Lamp Post is completely funded privately and exists, ideally, to make investments that will be profitable down the road,” Wamp says. “We don’t do it for fun or to be involved in the community. We believe we make good investments and then incubate them in the 40,000 square feet here on the second floor of the Loveman’s building.” If his description of LPG’s strategy sounds more mercenary than idealogical, it’s meant to. Yet there’s still a feel-good upside to this methodology. “Because of the style of the investments we make where we try to bring companies to Chattanooga to do business here,” Wamp says, leaning in, “it ends up benefiting Chattanooga. And so many of the things we focus on are Chattanooga-centric.”
Wamp say his Lamp Post Group is a spoke in the wheel of the business landscape, just like the INCubator and Co.Lab They just do things a little differently. He notes, “I also think Chattanooga, in the last 10-to-20 years, has proven to be sort of an open-source community where you can move in from the outside and very quickly plug in and make a difference.” As an example of this, he points to Belhops, a local on-demand service for moving help. Its founders came to Chattanooga from Knoxville and Birmingham entirely because of the business climate for start-ups. Founded in February of 2013, the company already has 8,500 employees in 90 cities.
The business environment in Chattanoga is moving about as fast as the data over our citywide gigabit internet service—not coincidentally. “The most influential company in Chattanooga in 2020 may not exist today,” Wamp declares. He qualifies it by saying it may be an emerging company, but he feels strongly that things are moving at super-computer speed in the Tennessee Valley.