Last year, in its most recent annual ranking of American cities with the most start-up growth, the Ewing Marion Kauffman Foundation put Nashville at No. 4. It’s a stat Nashvillians rattle off when asked about their city’s recent emergence as a magnet for innovators and entrepreneurs. But numbers don’t tell the whole story. To understand Nashville’s thriving start-up ecosystem, you have to understand its foundations.
A Tradition of Innovation and Making
“This city was built on people chasing big dreams — and being sole proprietors and creators and makers,” says Robert Grajewski, executive director of Vanderbilt University’s innovation center, the Wond’ry. He’s referring, of course, to Nashville’s history as a musical mecca. The music industry “has created a very vibrant culture and a very exciting place to be that then attracted additional talent,” he says.
For example, when Neil Whitney wanted to scale his celebrity-curated meal planning start-up, Menud, he decided to relocate from the San Francisco area to Nashville. “The culture’s just ripe here,” Whitney says. “The music industry has provided … a harbor for very creative people.” It doesn’t hurt that the cost of running a business is a lot lower than it would be in Silicon Valley. Combine these factors with Nashville’s $70 billion healthcare industry and the capital it attracts, and you get an environment that made Whitney confident he’d have a good shot at success.
Nashville’s entrepreneur-friendly environment has resulted from concerted effort. In 2017, Tennessee instituted a tax credit program for investors in early-stage, Tennessee-based companies. Launch Tennessee, the public-private organization that administers the program, also runs a network of entrepreneurship centers and an annual entrepreneurship festival. Other organizations across Nashville are providing training, fostering collaboration and laying the groundwork for innovation.
The Wond’ry, for instance, promotes innovation and entrepreneurship among Vanderbilt students, faculty and staff. That could mean anything from helping someone learn a new skill to helping them launch a fledgling company. The Wond’ry, by Grajewski’s tally, has had a hand in 150 new ventures. To take just one example, it recently helped Noah Robinson, a Vanderbilt doctoral student in psychology, launch Very Real Help, a company that’s developing a virtual reality platform to treat addiction.
Number of ventures the Wond’ry has had its hand in
Meanwhile, Whitney, the co-founder of Menud, is helping run a program that sets military veterans up for entrepreneurial success. A collaboration between WeWork and the nonprofit organization Bunker Labs, the Veterans in Residence program exists in several U.S. cities. But Whitney says the Nashville branch is the first to offer a structured, entrepreneurship-focused curriculum in addition to workspace and community. Among the participating start-ups, Whitney is particularly excited about NPREX, a marketplace for direct licensing transactions in the music performing rights industry.
While many Nashville start-ups are disrupting the industries for which the city is famous, others are branching out beyond music and healthcare. Sashank Purighalla, founder of the software company BOS Framework, is well-positioned to see the full scope of this diversity. A start-up itself, BOS focuses on enabling other start-ups by helping them streamline the software development process. Its clients are disrupting industries from roofing to title insurance. “One thing that I’m seeing a lot of in Nashville is people are thinking outside the box,” Purighalla says.
Warmth and Hospitality
“Thinking outside the box” is one adage that truly comes to life in Nashville — and “Southern hospitality” is another. When you talk to people in the start-up scene about what differentiates the city, friendliness and generosity come up again and again.
The difference struck Robinson, the founder of Very Real Help, when he attended Launch Tennessee’s entrepreneurship festival this year. He’d just been meeting with venture capitalists and entrepreneurs in San Francisco. And San Franciscans, he found, tended to be “more cutthroat and self-driven, whereas in Nashville, people are really willing to help each other.”
For Grajewski, “that kind of collaboration … that willingness to make introductions and lend a helping hand, is what really sets Nashville, and the state of Tennessee, apart.”