Awesome Towns for Entrepreneurs: Spotlight on Knoxville, TN
Knoxville isn’t the biggest city in Tennessee, and that’s OK. Let Memphis and Nashville have that glory, especially if the top titles come with all the headaches and hassles that come with larger populations.
Knoxville, TN does have plenty to be proud of, including its football program: it’s the home turf for the Volunteers, one of the NCAA’s gridiron powerhouses credited for nurturing NFL greats like Peyton Manning and Reggie White. It’s also the home of the Tennessee Valley Authority, the electrical utility which helped energize much of the South in the 1930s. It’s considered the entrance to the Great Smoky Mountains, one of the country’s more picturesque national parks, and a reinvigorated K-Town proudly invited the rest of the planet to celebrate its success and revitalization at the 1982 World’s Fair, for which it produced the world’s largest Rubix Cube.
Today, beyond the basic glossy tourism brochure stuff, Knoxville looks toward the future and strives and be seen as a destination that’s not only decent to do business in, but also in which to live, play, and raise a family. The culture-rich city with a dash of Southern charm is home to several national companies, including Discovery Communications, which recently announced it was relocating to Knoxville after purchasing Scripps Networks Interactive.
Knoxville also focuses on stimulating and cultivating several thriving independent businesses, from coffee shops to donut shops. It has several business incubators and ongoing research endeavors, and has been listed high on several national rankings for conditions friendly to economic development. It hopes to continue to grow this reputation, even if doing so may require it to lose its unofficial description of itself as a ‘hidden gem.’ But success will breed success, and Knoxville is already becoming known as an ideal location for entrepreneurs.
Fast facts: Knoxville, TN
Knoxville-backers say the metro area has a lot going for it, including multiple private-public business incubators plus civic and educational leaders putting their heads together regularly to bring in new industry along with encouraging research. There is also an emphasis on making it all fun: many of the entrepreneurial efforts and events take place at local breweries and coffee shops, and there’s an ‘elevator pitch competition’ where people are asked to summarize their venture in under a minute to potential backers aboard an actual elevator.
Some of these efforts and distinctions have included:
- Innov865 Week – Originally a half-day networking event to celebrate entrepreneurship, Innov865 Week’s focus has grown into a full week of activities, seminars, pitches, competitions and social events each September, with a highlight being Startup Day, when participants are invited to present exciting, potentially profitable ideas to investors.
- Plenty of incubation – The University of Tennessee Research Foundation and its on-campus incubator have stimulated the creation of more than 50 companies as of 2016, and 38 remain in the state. In 2015, the companies collectively raised more than $54 million in venture capital, and one was valued at around $51 million in a merger and acquisition event.
- The Maker City – Etsy, the online craft marketplace encourages business and municipalities worldwide to create favorable conditions for local communities of Etsy artists and manufacturers, informally called ‘Makers.’ It also provides grants to artists, projects or entire communities to make improvements in the areas of public policy, education, and manufacturing. Knoxville was one of six cities selected in 2016 as official Maker Cities, in part because city officials created Make Knox, later renamed The Maker City, a creative community summit that united local Etsy Makers and other micro-businesses under one Maker’s Council.
- Tech-focused students – The Guinness Book of World Records officially verified that students in Knox County Schools, Oak Ridge City Schools and area private schools set the record for the world’s largest computer programming/coding lesson in November 2017. A total of 6,778 students took part in a one-day lesson, which asked students to follow a YouTube how-to video created by local students. Employees of local tech companies volunteered time and hardware to make this happen.
- Affordable living – The American Chamber of Commerce Researchers Association declared Knoxville one of the country’s most affordable cities in 2016, giving it a cost-of-living rating of 83.8, lower than the national average of 100.
- Abundant culture – There are art galleries, museums, and annual art festivals, including the Dogwood Arts and Sundown in the City.
- Tech-focused adults – When announcing the purchase of Scripps, Discover Communications said the area’s cost of living was a factor, along with a workforce comfortable with technology due to proximity of the labs, schools, and other technology companies. It hopes to increase its video operations and local productions in the next few years, which could use even more of the workforce.
Five Businesses to Watch in Knoxville
A local mainstay of the 20th century in South Knoxville, Kerns Bakery will be seeing new life in the near future thanks to the vision of several regional residents who saw potential of the now-closed factory. By 2019, the 70,000 square-foot historic building is expected to become a multi-use facility with a retail area, loft apartments, restaurants, and a brewery/beer garden.
- Founders: Oliver Smith Realty Auction and Company, a family-owned company based in Knoxville which includes Oliver Smith IV and developer Peter Medlyn.
- The story: Former mayor and German emigrant Peter Kern created an impressive bakery, candy factory, and ice cream saloon in the 1890s, but after his death in 1931, it focused on baking only and moved to South Knoxville. After this shut down in 2012, Knox Heritage successfully fought to keep the building from being demolished, including applying for and receiving National Historic status. Several investment groups have expressed interest over the years, but the current local owners, who purchased it at the end of 2017, have made substantial progress.
Mobius (f.k.a., Grow Bioplastics) develops biodegradable plastic sheets and pots for use in commercial and personal agriculture and landscaping. The project recently received a $225,000 grant from the National Science Foundation, which will allow the company to continue research and development.
- Founders: Tony Bova and Jeff Beegle
- The story: Bova and Beegle met as undergraduates at the University of Toledo, and had a mutual interest in sustainability. Both later attended the University of Tennessee’s graduate programs, but also looked for interesting companies to start. They came up with a lignin-based bioplastic, which is a natural alternative to most sheeting that’s petroleum based and usually ends up in landfills when no longer usable. They entered several pitch competitions around the country to raise funds and also attended an eight-week long Co.Starters business course through the Knoxville Entrepreneur Center.
Flo and Co
Currently, shoppers in the Knoxville area have to visit two separate areas if they want coffee or want flowers. But if Meg Hutchinson follows through on her business concept, Flo and Co, visitors to this hybrid location will soon be able to purchase both in one easy stop.
- Founder: Meg Hutchinson
- The story: Hutchison, a student majoring in supply chain management, previously attended floral school in London, where she said she came up with the idea of a fragrant and creative space where people can look at and purchase flowers, as well as pick up or sit and sip coffee. More than just wishful thinking, she decided to flesh out her plan and seek funding. In March 2018, she took part in this year’s Vol Court Pitch Competition, a semi-annual event that includes six weeks of lectures and projects. Her business plan was picked for first place out of the 22 considered by faculty members, which earned her $1,500 and a spot in the UT Business Incubator for a year.
Pretentious Glass & Pretentious Beer
An interest in creating unique hand-blown glassware, especially for craft beer or bourbon, has led to the creation of a popular taproom called Pretentious Beer. Visitors enjoy 16 beers on tap, a full menu, and a place to watch glassblowing demonstrations, including the ability to watch the creation of unique beer glasses. The company also makes soda and kombucha, which can also be consumed in the hand-blown glasses.
- Owner: Matthew Cummings
- The story: Glassblower Matthew Cummings and his friends loved drinking craft beer at the Mellwood Arts Center in Louisville, Kentucky. A few years ago, the center’s staff invited him to create unique glasses, which he enjoyed making. Beer fans also loved the original ‘hoppy beer’ glasses, which encouraged him to research and design more varieties. Eventually this project turned into a full-time business and several styles of beer and bourbon glasses. From this success led to the brewery/brewpub/studio concept that also hosts community event and local musicians. Today, Cummings serves as owner/brewer and William Brady is head brewer. Notably, the company supports Habitat for Humanity and other community causes.
Compliance can be a challenge for those in the financial industry, but it’s also important to show clients—and regulators—that you’re taking proper steps to follow existing regulations. Smart RIA has developed a variety of cloud-based software tools for people in the industry to automate and improve the compliance process, and also to help compliance consultants perform their tasks better. It received the Judge’s Prize and $10,000 at the 2017 Startup Day.
- Founder: Mac Batine
- The story: Mac Batine, a longtime business owner, mentor, and investor, founded the company in 2016 as a way to make it easy for financial advisors, company executives, and support staff to keep track of their clients, schedules, and other activities, along with ensuring that state and federal rules are followed. He brought in other local tech and financial leaders to help him in this venture.
Helpful Local Resources
Business experts are optimistic about the future prospects of Knoxville. Although some of the economic forces hitting the town are similar to the ones in the rest of the country (e.g., the decline in mall-style brick-and-mortar operations, the closing of several restaurants), the area’s affordability, access to corporate and academic experts, and the quality of life are leading many to predict that Knoxville will be in great shape moving forward.
- Innov865 Alliance – Innov865 Alliance is a coalition of businesses which promotes local entrepreneurial efforts. Members include Oak Ridge National Laboratory, Launch Tennessee, the University of Tennessee Research Foundation, the Knoxville Entrepreneur Center, and the University of Tennessee Anderson Center for Entrepreneurship and Innovation.
- Cherokee Farm Innovation and Research Park – The Cherokee Farm Innovation and Research Park, located at the University of Tennessee, is the only one of its kind in the U.S. that combines the resources of a major research university and a national energy laboratory. It attracts interest and support from private companies, and focuses on a variety of scientific projects including energy efficiency. Tenants also have access to the Joint Institute for Advanced Materials, a collaboration between Oak Ridge and the State of Tennessee.
- Knoxville Entrepreneur Center – The Knoxville Entrepreneur Center opened in 2013 and provides incubation for new businesses eager to grow and thrive. It receives support from area businesses plus the surrounding cities and the state. Services include partnering new businesses with mentors, as well as regular networking events like the weekly “Women in Entrepreneurship Coffee,” a Ruby on Rails Meetup, Knoxville CocoaHeads, and Techie Tuesdays.
- Launch Tennessee – Launch Tennessee is a private-public partnership that supports and encourages innovative business concepts, with a goal of making Tennessee the most startup-friendly state, along with offering highest-quality jobs in the geographic region. It works closely with six entrepreneur centers throughout the state by providing support, curriculum, mentoring, and other resources.
- University of Tennessee Research Foundation – The University of Tennessee Research Foundation is designed to provide resources and support for scientific projects, business projects, or both. These can take the form of area grants or hosting “Beer and Biotech” discussion nights that blend biotechnology and life sciences. It also provides a variety of research materials for those considering different fields of study, including animal health and energy.