A startling statistic for those who think capital merely flies over the Midwest: Kansas City saw a 69 percent increase in startup investment from 2016 to 2017, according to KCSourceLink’s We Create KC report.
All told, early-stage businesses classified by KCSourceLink as startups — typically defined as those with 20 or fewer employees — nabbed about $540 million in 2017 (compared to $319 million in 2016), the study said.
Such totals include traditional investments, as well as funding via Small Business Innovation Research (SBIR), National Institutes of Health (NIH), Launch KC and Digital Sandbox KC grants, KCSourceLink officials said.
“We are trending in the right direction. We see an increase in capital, and we are working to fill holes in funding resources all across the capital continuum,” said Maria Meyers, founder of KCSourceLink and executive director of the UMKC Innovation Center. “Our role at KCSourceLink is to continue to respond to the needs of our entrepreneurs, helping them connect with resources to get deal-ready and connect with the right type of funding at the right time.”
Almost half of the capital resources for early-stage entrepreneurs are new since 2013, according to KCSourceLink’s research.
The startup investment surge dovetails with other data points in the We Create report, including those noting a 290 percent increase in access to capital in the past five years, and an average of 16,376 jobs created annual by first-time (startup) employers in Kansas City.
KCSourceLink’s report not only details such trends, it seeks to illustrate the role the network plays in supporting entrepreneurs through access to capital, the idea pipeline, awareness and corporate engagements. Check out the full report here.
The organization made 9,425 connections via its hotline and email in 2017 (up by more than 2,000 from 2016), according the report, and 70 percent of companies that received funding in 2017 were assisted in some manner by the KCSourceLink network.
“We know that the right connections matter to entrepreneurs and that entrepreneurs matter to Kansas City’s economic growth,” Meyers said. “Having the right resource at your back is critical for the survival and growth of Kansas City startups and small businesses.”