Start Me Up: Entrepreneurism in Coral Gables

Is the Gables a Good Place to Start a Business? The Answer is Yes. Mostly.

The idea that you can start your own business and thereby make your fortune is a big part of the American Dream. It is not the only part of that dream. You can also become successful working for an organization, like a corporation, or a school or the government. But there is something about being your own boss and running your own enterprise that plays to the heart of what the American Dream is all about. And if you tie that notion to the idea of innovation, then you’ve got that dream in spades – which is what Ralph Waldo Emerson meant when he said, “Build a better mousetrap, and the world will beat a path to your door.”

But what, exactly, does it mean to be an entrepreneur? Is that the same thing as being a small businessperson? And what about professionals who practice on their own, like a lawyer with a solo practice?

To some extent, all of these come under the umbrella of entrepreneurism. By definition, it’s simply the idea of going out on your own and taking the risk to create a business.

“An entrepreneur could be running a café, or selling papers or flowers, or starting a pharmaceutical company,” says Brian Breslin, director of The Launch Pad at the University of Miami. “It is someone who is using business to solve a problem and create value.”

Breslin, whose UM Launch Pad business incubator has helped start some 500 companies since it began in 2008, says that all small businesses are entrepreneurial ventures. But he points out the fine line between a small business and a startup. A single café is a small business; a chain of cafés is a startup. And then comes the ingredient of creativity. “I would say that innovation and entrepreneurship are attached at the hip,” says Breslin.

That message is well understood at UM, which over the last decade has increasingly encouraged faculty, students and alumni to become entrepreneurs – and is now beginning to connect with the Gables’ business community.

Norma Sue Kenyon, Ph.D., UM’s Vice Provost for Innovation, believes that UM has enough depth of medical research alone to become the center of a biomedical hub. Through the school’s Office of Technology Transfer, faculty is encouraged to commercialize scientific discoveries, with UM paying for all legal and patent work up front in exchange for a share of the royalties. More down to earth, The Launch Pad has helped companies like Per’La Specialty Roasters and The Salty Donut get started; out of the 500 companies they’ve helped start, about half have remained in the area.

“We are very interested in engaging with the community,” says Dr. Kenyon. “There are a lot of successful businesspeople here [and] we are looking for mentors… and I would like some of the resources of UM Innovation to be open to the community.”

In the meantime, the nitty gritty business world of Coral Gables marches on, with an amazing preponderance of small and growing companies. By its very composition, Coral Gables is demonstrably a great place to start a new business. While there are some corporate heavyweights here with hundreds of employees (think Baptist Health, Del Monte, Bacardi and MasTec), the vast majority of businesses are small – which Coral Gables Chamber President and CEO Mark Trowbridge defines as having 15 employees or less.

“We have all of the ingredients to be a great place to start a business,” says Trowbridge, who estimates that 80 percent of the Chamber’s membership consists of small companies. “When you are talking about starting a business it’s about investing in a dream. That is the very character of Coral Gables. Look at our founder. That defines him and the City Beautiful movement itself.”

To some extent, that spirit of entrepreneurism is embedded in the DNA of the city. Besides being a “smart city” with an award-winning IT department, the mayor maintains an Innovation Council for policy advice. Even Fairchild Tropical Botanic Gardens has an Innovation Lab where students are currently working to develop plants for deep-space travel.

And Trowbridge is not alone in his assessment that Coral Gables is a great city to launch a new venture, be it a brick-and-mortar shop or a digital design firm. In a study done in 2019 by Go.Verizon.com, Coral Gables ranked No. 3 out of 300 “best small cities to start a small business.” Among the criteria examined were the number of businesses per capita, percentage of residents with college degrees and commute times. Last year the city fell to No. 18, with a surge by cities in Montana and North Dakota, where real estate is cheap.

The high cost of real estate, both residential and commercial, is of course a barrier to small business startups in the Gables. Gone are the days when the city had cheap warehouse space, for example, for young firms that needed a place to make or store things. Solving that issue has been a burst of flex or shared workspaces in the Gables, which have exploded over the last decade. WeWork has more than doubled its multi-story footprint on Giralda Avenue, occupying a second building; Quest now has two locations; Pipeline is filled with innovative startups; and ESQ.Suites was launched just for lawyers. Forum opened late last year with a concept of providing its clients an array of professional support services domiciled in the same building.

“The intent of Forum is to be not just real estate, but to support a business with their growth objectives,” says Rishi Kapoor, the CEO of Venture Locations, the development firm behind Forum. “So, we launched not just as an office, but one with support services for those businesses.” These range from administrative services like call forwarding, document processing and in-house catering, to marketing services, bookkeeping services and business legal services. “It’s a whole ecosystem, a network that we can bring to the table,” says Marketing Director Joanna Davila.

Rishi sees Coral Gables as a growing center for new startups, despite it not being part of a high-tech, venture capital cluster like Silicon Valley, because of the lifestyle that it offers.

“Year by year the world is shrinking with advances in technology and communications, which means companies can find a home base outside of the traditional startup centers,” he says. “And Coral Gables is well placed to feed that trend… Ultimately, it’s a fun community to be a part of – a great place to enjoy leisure time.”

Indeed, a significant number of the small companies that locate in Coral Gables do so because of the physical environment, especially in the downtown – the architecture, the human scale, the diversity of eating places, the art cinema and theater, the tree canopy, the bookstores, the cafés and so forth.

“I think Coral Gables has a great mix of the modern and the historic,” says Claudia Duran, managing director of Endeavor Miami, an accelerator program located on Alhambra Circle. “Our team used to be in the office every day [pre-pandemic] and we used to love walking to restaurants, to juice bars, to gyms. It’s nice because if you are an entrepreneur with a startup, you can go out of your office and connect with other entrepreneurs in a cool environment.”

Endeavor Miami is one of 40 such offices worldwide, specializing in helping established startups – “companies that are in the process of scaling up” – grow to the next level. For startups earning less than $5 million annually, Endeavor provides a four-month “accelerator” program where the young companies are mentored. They also select three to five companies a year with annual revenues over $5 million, which become Endeavor Entrepreneurs, and are connected with their network worldwide – which includes access to capital.

The need to go outside the city for venture capital is one of the weak threads in the entrepreneurial fabric of Coral Gables, though not for small businesses per se. Many of the banks here support small businesses, but that is not the same as venture investments.

“Traditional banks, and especially community banks, don’t play a major role in terms of providing venture capital to startup businesses, either large or small,” says Lloyd DeVaux, president and CEO of Sunstate Bank, which is an active lender to small businesses in the Gables. “We are a big supporter of small businesses, [but] most banks generally loan money to businesses that have good physical collateral – or that have strong cash flow and have been in business for a couple of years. Banks are also highly regulated and just not able to place huge bets on risky startup ventures.”

Typically, Gables startups and scaleups have to look elsewhere for venture capital. A multi-million scale-up investment for the Gables-based Pincho restaurant chain (an Endeavor Entrepreneur, btw) came from New York, for example. “In the beginning it was so difficult for me [to raise money here], but it is easier now,” says Violette de Ayala, CEO of the national women’s network FemCity. “I suspected it would be a great place for venture capital because you meet other entrepreneurs. [Fortunately] I had money to begin with that came from angel investors, but they weren’t based here.”

Helping to bridge that gap is Coral Gables-based eMerge Americas, launched in 2013 as a nonprofit aiming to connect the dots in South Florida’s tech scene by linking startups, investors and others with partners in Latin America and beyond. Launched by longtime local entrepreneur Manny Medina, it held mega-events at the Miami Beach Convention Center each April until the coronavirus hit. The group’s 2019 conference drew a record 16,000 people from 40 countries, representing more than 400 companies, plus universities and governments. That event helped South Florida tech companies attract a record $2.39 billion in annual venture capital that year.

This year will not reach those numbers, but could still approach $2 billion. And while those investments are spread across the tri-county area and its five million residents, they create an environment that reaches even to the Gables, where last year PayCargo wooed $35 million to grow its electronic payments system for freight.

“In 2019, metro Miami rose to become No. 7 in venture capital dollars in the U.S., up from No. 11 and ahead of such established tech cities as Austin and Chicago,” says eMerge CEO Felice Gorodo. “And it’s telling that Softbank chose to launch their Latin America innovation fund here,” pledging $5 billion in investment across the region.

In the end, having massive venture funds available may not be as important for the Gables as its innovative spirit and the simple fact that the city is a place where you want to live, work and play. “It’s all about the character and pedestrian nature of the Gables,” says Jesse Stein, who has set up three successful companies in the city. “There are not a lot of nice pedestrian areas in South Florida. Among other things, it makes it easier to recruit employees.”

Doreen Hemlock contributed to this report.