Beyond the Bay: In Portland, Size Matters

Why “small” drives entrepreneurship in Oregon’s largest city

by Rutger Ansley Rosenborg

Imagine that: The country’s whitest city leading the way in how to support black folks,” Stephen Green half-jokingly told a rapt audience at a TEDx Portland talk in 2017.

“Sometimes small,” the Pitch Black founder continued through applause, “Gives you the room to do really big things.”

When it comes to Portland, “small” is a bit of a misnomer. Portland is not only the largest city in Oregon—rounding out 2016 with a population of almost 640,000—but it’s also one of the fastest growing in the country. Since the ‘90s, the IFC-spoofed Pacific Northwest paradise has pretty much kept on pace with both San Francisco and also Seattle in terms of population growth. To top it off, in 2017, Forbes ranked the Portland metropolitan area as the ninth fastest growing city in the country.

From 1990 to 2016, Portland’s population grew from about 490,000 to about 640,000. During the same years, Seattle’s population grew from about 515,000 to about 700,000 and San Francisco’s from 720,000 to 870,000.

So why is “small” so important to Green when it comes to thinking big about business?

“Small stuff actually has the biggest impact. Small businesses contribute to the bottom line of the ecosystem,” Green said.

“When you look at the data, 8 percent of people in a city work for small businesses, but in Portland, that number is 14 percent. There’s a higher number of small business entrepreneurs here than most places in the country. It’s very easy to connect people here … and it’s not uncommon for competitors to work together here,” he added.

For Portland’s entrepreneurial community, “small” is less descriptive of physical size, census data, and national rankings and more descriptive of a cultural mindset.

Built Oregon co-founders Mitch Daugherty and Rick Turoczy, who developed their non-profit, community-focused accelerator three and a half years ago, have their own lexicon for describing exactly what makes the Portland startup space quintessentially Portland: aggressively humble. In other words, local entrepreneurs “are building really cool stuff, but they say, ‘It’s really not that big of a deal,’” according to Turoczy.

Literally speaking, they might be right: It’s actually a pretty small deal — but that’s because much of the resource infrastructure caters to national and international tech companies expanding from the Bay Area and setting up shop in less expensive cities.

“Everything sort of defaults to tech and innovation in most startup ecosystems. Even in Portland, a lot of the focus has been on that…. But we think that a five-person chocolate company is just as important as a 100-person tech startup,” Daugherty said.

“In our minds, our competitive advantage is in consumer products, footwear, design, and food and beverage,” he added.

If the Bay Area has carved out its entrepreneurial identity, for better or worse, through Apple and Google, then “Nike, Columbia, Adidas, Under Armour, Kettle [Foods], and Stumptown Coffee Roasters” have all helped shape the entrepreneurial identity of Portland, according to Daugherty.

“Slowly, people who are leaving those companies are going out to start their own,” he said.

And helping those founders build a local entrepreneurial ecosystem that maintains Portland’s aggressive humility is Daugherty and Turoczy’s bread and butter.

“There’s resources for everything; the resources around tech are just more organized. We’re trying to get more organized.”
— Mitch Daugherty

While Daugherty and Turoczy started to organize a resource network for consumer product companies relatively recently, Turoczy has been working on broader local startup infrastructure for the last 20 years, shaping successful tech-oriented founders via Portland Incubator Experiment (PIE) and increasing Portland’s visibility through open source marketing via Silicon Florist.

“I’ve been in Portland since the mid-‘90s and I’ve worked in software startups the whole time I’ve been here…. But there was really no infrastructure,” Turoczy said.

Wieden+Kennedy reached out and had this desire to give back to the community and give back to the startup community, and those conversations became PIE,” he added.

According to Turoczy, “PIE originally just started as a co-working space, and one of the immediate things we discovered is that co-working and community building are kind of at odds with each other. We found people that couldn’t pay for the co-working but had great ideas for the community, so we let them in for free. That kind of experimentation has continued through the history of PIE.”

But it was Turoczy’s Silicon Florist (Portland has been affectionately nicknamed the Silicon Forest) blog that really got him active in the Portland entrepreneurial community.

“As I started getting gigs with the open source community, even though I don’t have a background in coding, I started open sourcing my marketing and writing by giving attention to what was going on in town,” he said.

So, what exactly has been going on in town over the last two decades?

“A lot,” according to Turoczy.

At first, most entrepreneurial activity “happened out in the suburbs and there was nothing in the metro core … and that has flipped,” according to him.

“The obvious answer is that the amount of capital and time it takes to start and build a company has changed drastically. Accessibility of tech in software and hardware has enabled people to take that leap,” Turoczy added.

But with the shift to Portland proper and the continued growth of the Silicon Forest, there’s also been a significant increase in attention from bigger markets—and that can be both a blessing and also a curse.

“When I first started in startups, I spent a lot of time in the Bay Area. At first, people would ask me, ‘You’re from where?’ Then, it became, ‘Oh, I think I’ve heard of that,’ to, ‘I think I know someone who lives there,’ to, ‘Oh, I think I want to move there.’”
—Rick Turoczy

As inevitably happens with most gentrifying processes, the issue of a lack of integration began to emerge from the continued expansion of big tech companies in Portland.

“A lot of them have headquarters in the Bay Area, so they never really get engrained in the Portland culture,” Turoczy explained.

“They’re relocating with their networks intact, so they don’t feel this need to engage with the broader Portland startup community,” he added.

“How can we change that? How can we get these new Portland folks engaged with the broader Portland community?” Turoczy asked.

For Zebras Unite team members Mara Zepeda and Rebecca Gates, these questions have inspired a movement that operates in response to the largely non-inclusive atmosphere permeating startup culture as a whole.

“Our community really needs to talk about businesses and move away from the vernacular of startup culture, which seems to be based on exclusivity. It’s important to talk about the broader small business ecosystem and focus on longterm sustainable growth,” said Zepeda, founder of Switchboard and co-mastermind of Zebras Unite.

“We’ve put these principles forward in the Zebra Manifesto,” she explained.

You can read the Zebra Manifesto here.

By privileging profitable but socially conscious companies (Zebras) rather than disruptive, big-exiters (Unicorns), Zepeda is not only fostering community-building in Portland’s small business ecosystem, but she’s also encouraging a significant increase in the visibility of underrepresented founders and entrepreneurs.

“People want to be empowered to create their own local movements that are reflective of their own culture.”
—Mara Zepeda

But the current climate in Portland is still far from ideal for many underepresented populations—including artists.

Gates, who is herself a longtime local and touring musician, finds some of the current startup culture (especially in tech) to be troubling, but agrees that it’s not without hope for improvement.

“There is a lot of room to do integration with the startup community and the arts. The arts scene has benefitted from people moving to town; we’ve had a great active art scene for a long time. One of the nice things is that theoretically people moving in will help support art stuff, and it has happened a little bit,” Gates said.

“In terms of the arts, there’s still lots to do…. And it doesn’t do any good to complain and not do anything about it,” she added.

So, how exactly does the Portland entrepreneurial community include minorities, artists, small businesses, and the aggressively humble?

“How do we make sure that we don’t just become a mono-culture?”
— Rebecca Gates

The answer to those questions is “cross-community building” and “cross-pollination,” according to Gates. That means helping the broader Portland entrepreneurial community recognize the smaller communities that have made the city the dynamic destination it is today.

That’s the goal of DazzleCon, Zebras Unite’s Zebra convention. That’s the goal of Pitch Black, Stephen Green’s pitch event for black founders and entrepreneurs. That’s also the goal of Zepeda’s XXcelerate Fund and almost every project of which Turoczy’s been a part.

That innovative passion comes from a shared and enduring belief: There’s big talent in Portland. The question is how to harness that talent in a consistently responsible, meaningful, and community-driven way.

Starting small seems to be a good start.