Fundamentally, I think this is an issue of perception. There seems to be an ideal that says that no young people or innovative companies should leave the region. When one does, it starts a tortured conversation about why Pittsburgh just isn’t good enough to retain these innovative local start-ups.

Obviously, we’d like to keep and grow as many start-ups as we possibly can. You would know better than I as to why we haven’t. However, I do know that there are a lot of companies that have established significant presence here as a result of that “R.” For instance, Siemens has more than fifteen different operations in the region, a presence built slowly and surely through targeted acquisitions. One of those companies, the former ASIRobicon, was in dire financial straits and could have easily closed had Siemens not rescued them. Siemens’ existing presence in the region apparently had an impact on their decision.

We also have to accept that there’s something to be said for right place/right time. One hundred-plus years ago, Pittsburgh became a steel powerhouse because of several significant competitive advantages: access to natural resources (coal, iron ore); access to heavy transportation (rail, rivers); and a relative proximity to most of the nation’s population. There are other regions now that have their own competitive advantages, including serendipitous ones, that have enabled them to grow.

From my perspective, I don’t mind being the feeder of innovation to the rest of the world. Some companies find value in that and decide to establish operations here. Others pluck the companies from their friendly confines in Oakland to other hubs around the country. I have seen how Pittsburgh has slowly and silently built a reputation internationally in both “hot” and “old and stodgy” industries/operations. Between it’s existing manufacturing infrastructure, rail network, inland sea ports, R&D strengths and quality of life, I truly believe that this region will have a critical mass of strengths that will make it a powerhouse once again.

I hope my glasses aren’t too rose-colored.

I don’t disagree with what you say – you are absolutely correct – but being closer to the R than to the D has implications for our region. It means we will have more technology exported from our region to other regions (where the large companies are) than companies that are able to stay and grow to significant size. That isn’t bad, it is just different than what most other people in our region want – new organic-growth companies that hire people, build products, make money, and raise the stature of our region.

Do you want to be Nike, located in the US with a large profile; or the factory in Asia that manufactures Nike’s shoes? Or both?

Perhaps the question is this: How important is it really that we grow these large organizations organically? Is it because they’re nice feel-good stories that help to build a case for starting/growing here? Or can we feel comfortable with having smaller, innovative pieces that are acquired and around which larger organizations are built?

Step 1 – admit we have a problem.
Step 2 – continue to build on our growing entrepreneurial ecosystem.
Step 3 – wait.

I am only half joking about that. I have some other thoughts on how to fix it (did you think I would just bring you the problem?), but those, too, are for a later post.

I think you summed up my hypothesis well enough – and I am doing a little research to measure the ratio of Pittsburgh-based early stage companies that have basic research ties (i.e., at the universities) versus those that do not, and then I want to compare it to some other startup hotspots. All these analyses are rather subjective, but that is the best we have.

I have other anecdotal evidence that my hypothesis is correct – but perhaps I can expound on that in a later post.

Thanks for your comments – and thanks for the mention on your own blog today!

What can be done to fix it? Attract more “serial entrepreneurs”? Attempt to pair them with the “technical gee-whiz” earlier in the process?

I know that’s a lot of question marks, but I’m not the expert on Pittsburgh’s venture world that you are so I’d rather here your thoughts then write my guesses.