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Formulating a Model for Small-City Innovation Offices

Innovation offices in major cities like Los Angeles and New York are interesting and inspirational, but don’t necessarily serve as useful models for cities with a fraction of the population or resources.

by / April 1, 2016
For now, Sacramento, Calif.’s population of 480,000 is serving as a starting point to explore what cities of all sizes need to innovate. Shutterstock/Andrew Zarivny

Sacramento, Calif., recently hopped on the innovation bandwagon, but it’s doing things a little differently.

As the city’s first interim chief innovation officer, former Code For America co-executive director Abhi Nemani has spent the past six weeks studying the Sacramento technology scene and planning a new communications and funding framework among government, community and local business. Meanwhile, the city hunts for a permanent full-time replacement for when Nemani moves on, because he has bigger plans. Sacramento gets to be Nemani’s guinea pig as he outlines what cities across the nation will soon have access to through a new venture called EthosLabs.

Innovation is the biggest trend and buzzword in government today. The economic downfall of 2008 precipitated denial, anger, bargaining, depression. And in 2016, most agencies have accepted that government needs a new mode of doing things.

Innovation offices in major cities like Los Angeles, Chicago, Boston, New York and San Francisco are interesting and sometimes inspirational, but don’t necessarily serve as useful models for cities with a fraction of the population or resources. That’s what EthosLabs is for, Nemani said.

“Sometimes it might look like an innovation office, sometimes it might not,” he said. “It might just be hiring fellows or doing training, for instance, to boost existing capacity. But I’m really curious, because I think this is a difficult question for the civic tech space of how do you scale some of the things that bigger cities have been able to do — how do you scale that down to smaller cities?”

Still in the planning stages today, Nemani said his company plans to announce its initial set of participating cities and companies this August, but for now, Sacramento’s population of 480,000 is serving as a starting point to explore what cities of all sizes need to innovate. Broadly, the company will facilitate what Nemani calls his seven principles for 21st-century cities, which includes things like leveraging data, designing for and with citizens, embracing open technology principles, committing to public innovation spaces and taking technology seriously.

The govtech market is a $150 billion opportunity, but it’s also underdeveloped and unsophisticated. That’s likely to change in the coming decade as new startups are launched each week and governments take increasing interest in practices that were long considered the exclusive domain of the private sector. There’s so much work to be done, Nemani explained — governments don’t know how to make the most of the resources available, and private companies don’t know how to work with government.

“My goal eventually is to make a network of these cities doing this work together,” Nemani said. “That’s part of the process here for me is learning what are those guidelines and toolkits, what are the resources you can use to empower cities to get their innovation programs off the ground and running fast?”

In Sacramento, innovation starts with building on the city’s strengths and figuring a way around its weaknesses, Nemani explained. Sacramento has access to one of the best funded research institutions in the nation at University of California, Davis. Leaders hope the Golden 1 Center, a tech-packed basketball arena now being built, will revitalize the downtown. Many San Francisco Bay Area millennials are looking to Sacramento as a less crowded and less expensive alternative for their homes and businesses, ranking second only to Seattle. And perhaps most importantly, the city’s leaders have committed to innovation and technology, both in spirit and wallet.

Mayor Kevin Johnson’s office and city council established an innovation and growth fund backed by $8.2 million. Those dollars aren’t to staff his office, Nemani explained, but to invest in and attract startups that can transform the city’s technology ecosystem.

To capitalize on the Bay Area millennials and startups already considering Sacramento, the city put $2 million toward a partnership with investment fund and accelerator 500 Startups. That gives the city access to the next round of investment funding, expected to be around $200 million, and a desk at the fund’s Bay Area office, where Sacramento hopes to lure promising talent to the capital.

The city will take a three-pronged approach moving forward, Nemani said, which includes focusing on training programs like Railsbridge that give citizens new skills, improving funding opportunities for startups so they don’t get stuck at the 10-15 employee stage, and building a sense of community where startups have means to help one another and flourish together.

“I’ve come to see there is tremendous opportunity in you’re starting to see some real momentum, but I do think there’s some structural issues we have to address,” Nemani said. “So it’s this interestingly broken market that I don’t think would be that hard to start fixing. That’s what excites me intellectually. Personally, it’s just a lot of fun working with these companies and with these cities. Mayor Johnson really gets it and he’s excited, and I love seeing that. And whatever I can do to help more and more people feel like that and be successful with that point of view, that to me is fun.”

Colin Wood former staff writer

Colin wrote for Government Technology from 2010 through most of 2016.