In A City Where Bigger Is Better, Can Houston Build A Startup Scene?

"My vision is to build a district," he said. "I want to build a tech district here in Houston, like the Texas Medical Center for medicine."

That, however, could require government support. In Chicago, which a delegation from Houston visited last week, the 1871 startup hub received $4.8 million in state grants between 2012 and 2014 to build out its space. The accelerator now houses more than 400 young companies and organizations.

"It will not happen [for Houston] unless public organizations step up," says Blair Garrou, co-founder and partner of Mercury Fund, a Houston-based venture capital firm. "Every other ecosystem has happened that way."

That might be tough, considering the city's budget challenges. And not everybody agrees that government should underwrite private companies.

"The city has a lot of priorities," said Jeff Reichman, an active supporter of the startup scene whose Houston-based firm January Advisors helps local governments with tech projects. "Encouraging tech startups, personally, I don't think should be high on their list."

But the city can give assistance that doesn't cost anything, Reichman says, like advocating with investors to support local entrepreneurs and helping bring attention to young, promising companies. None of these efforts have to transform Houston's business culture into something it's not. After all, that culture helped make Houston the energy capital of the world and one of the fastest growing metropolitan areas in the country.

"None of us want to create the next Silicon Valley," says Hesam Panahi, who teaches entrepreneurship at Rice. "We just want to make Houston better at keeping startups."

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