The Federal City Council (FC2) continues to assess the viability of a city-led Innovation District (ID), bringing together civic, business, academic and philanthropic leaders to contemplate how D.C. can leverage its economic strengths, diversify its economic base and overcome the city’s unmet potential as an innovation hub.
To further the process, the FC2 launched the Innovation District Initiative (IDI) and partnered with Accenture to perform a needs assessment to study D.C.’s current innovation ecosystem. FC2 Trustees Steve Orr, Managing Partner and Co-Founder of Orr Associates, Inc. (OAI), and David Lawson, Managing Director of the J.P. Morgan Private Bank, are co-chairs of the IDI.
In a presentation to FC2 trustees today, Marty Rodgers, FC2 Trustee and Accenture’s D.C. Office Managing Director, presented the findings and recommendations of Accenture’s report that builds the case for an ID that will be purposefully structured to complement existing stakeholders and support middle-skills jobs in the District.
“An innovative ecosystem is the collision of talent with capital – some of that is philanthropic capital, some of it is private-sector invested capital – with location, with ideas,” said Rodgers. “And the more that you can do that, the more urgency around that, the more energy around it and then the more growth that you get around it, you can have an exponential, virtuous cycle.”
Based on its analysis of key industries and industry clusters, Accenture found D.C.’s economic strength in cybersecurity and data science clusters, its unique position as a national leader in social enterprise and its high concentration of Science, Technology, Engineering and Mathematics (STEM) talent. Additionally, the research revealed how an ID would help meet 13 of Mayor Muriel Bowser’s 43 strategic initiatives in the District’s Comprehensive Plan.
The strength of the cross-industry clusters of cybersecurity and data analytics for D.C. were determined through the lens of four different areas: the District’s comparative advantage against other cities; the industry’s estimated growth in the market, determined by the size of the market or jobs; the inclusivity of “middle skills” jobs that require some level of trade training but not a college degree; and the industry cluster’s ability to impact the D.C. ecosystem with at least a $1 billion in capital investment and growth.
Yet while the Washington, D.C., region generates more tech degrees than any other region outside New York City, a primary innovation gap is the ‘brain drain’ of entrepreneurial STEM talent. The region struggles to retain graduates interested in working in innovation. It will be important to develop a strong academic anchor institution aligned with an ID focus, the report surmised.
“D.C. has – and this whole corridor has – a large concentration of STEM talent but while that STEM talent is helpful to us and it’s helpful to the region’s growth, it’s not helpful from the standpoint of broader innovation and entrepreneurship,” said Rodgers. “And the reason for that is that STEM talent is just going into existing organizations versus starting new ventures, starting new opportunities. They’re not builders, they’re not risk-takers, they’re not innovators. Those people move to other geographies.”
D.C.’s other innovation gaps include a lack of collaboration across industries and limited resources for entrepreneurs because of risk-adverse investors and stunted impact per resource. The recommendation of cross-industry clusters for an ID in Washington, D.C., would allow for additional collaboration across sectors and increased partnerships.
Additionally, successful IDs evolve from what a city already does well, making the District’s social enterprises – organizations that solve a social problem through a market-driven approach – an important secondary cluster focus for an ID in D.C. Accenture, which based its recommendations on stakeholder interviews with D.C. entrepreneurs, noted the city’s ranking in the top three social impact regions in the United States.
The Accenture assessment will serve as a foundational appraisal of the city’s needs and the ID’s potential benefits. It also will inform conversations with stakeholders about how such a district could be structured to benefit D.C.