Ecosystem of Entrepreneurship

By Kathleen Seaman

Start Up Waco supports local entrepreneurs and innovators

Do you have an idea for a new business, but you don’t know where to start? Good news. You’re not alone. Start Up Waco is a local nonprofit dedicated to empowering the area’s local entrepreneurs and aspiring business owners. From office space to expert advice, Start Up Waco provides resources to the community through its free mentorship program, regular events and programming and its accelerator space, Hustle Co-Working. Wacoan writer Kathleen Seaman sat down with Start Up Waco’s new CEO, Jon Passavant, to talk about growing Waco’s entrepreneurial ecosystem and providing entrepreneurs with the resources they need to succeed.

WACOAN: Can you give me a little background on Start Up Waco? What’s its purpose here in Waco?

Passavant: It’s the result of the effort of quite a few different groups of people, individuals, businesses and entities that have come together to essentially say, ‘We need to build and invest in the entrepreneurial ecosystem of the Waco region in McLennan County.’

This is about a 10-year-old experiment in the country where you had innovation, wealth creation, rapid job expansion happening in pockets in the country. It started certainly in the technology space. It started in Silicon Valley and then Boston and New York, and then Austin as well, are kind of the huge hubs of it. But about 10 years ago, cities started saying, ‘Well, you know, the internet has changed everything, and the way we do business is changing. The opportunities around us are too many for just a handful of cities to be able to capitalize on it all.’

And now for the first time where you live matters less than it did in previous years, where you can get connected to the resources that you need to be able to scale to an international level, no matter where you are around the country. The whole idea of being an entrepreneur, starting a business of working in a company that’s interconnected and very significant globally opened up the opportunity for smaller cities to benefit from this kind of entrepreneurial boom that was happening around the world. It doesn’t mean that it happens easily, but it means that it’s a worthwhile endeavor to take the time and spend the resources to invest in it happening.

WACOAN: What makes Waco a good place for budding businesses and startups?

Passavant: I think that for all of this to work, you have to look at what you have as a city, as a place and how that can grow and become its own thing, versus looking outside at other cities and saying, ‘We want to copy what that city has done.’ I think Waco has a lot of inherent assets that make it a great place for businesses to grow. You have a lot of the big components of what make up a really robust ecosystem, like great universities and schools. You have a lot of established businesses that have been here for a long time. You have governing bodies that are aligned in many ways to help and support. And you have a community of people that want to be a part of it and grow. You have a public will.

So, you add that to say, ‘OK, well these are the raw materials.’ And then you even have some sort of breakout businesses — that we all know — that have really made it, that can help kind of pave the way for others. So there’s a lot of very interesting, unique aspects, and I think you put them all together and then you add community and you add resources and you add training and education and you add a will to kind of see something happen, and that’s when you can create something special.

WACOAN: You mentioned that Waco has a lot of the components for startups to succeed, but what is it missing? What does it need?

Passavant: I would say that it needs more of what it has. Has there been examples of businesses really skyrocketing and succeeding? Yes, but they are few. There needs to be more of those. What we really need more than anything is just traction. We need to demonstrate that there is actually an economic engine here. If more entrepreneurs come to mind that, then something special can happen versus needing to go outside to do it. Nothing wrong with going outside. I’m not advocating that people stay here out of the kindness of their heart. They should stay here because there’s something powerful and wonderful to be here. They should choose to do it. I want to help create the environment where they can, where there’s infrastructure to build businesses.

These are small local businesses and then these are also high-growth enterprises. We want to invest in both, in all parts of the community. When I say entrepreneur, I mean that generally. I mean anyone who is interested in or is starting or has started a business. We’re here to serve entrepreneurs, not just technology startups.

WACOAN: That’s a good distinction. I think a lot of people hear startup and think tech.

Passavant: Yeah. And no, really, it’s any person who is branching out on their own to start a business, and every tool that we are creating here is to serve that. It’s to help you go from, ‘Do I even want to make the investment?’ We can help you form ideas. Once you have an idea, ‘What do I do? Once I’ve launched, where do I go?’ From practical tools to just a community that can help support to providing office space to providing connection with mentors and people that can help you in your specific industry. All these things are the things that make up this, what we call, ecosystem of entrepreneurship, what we’re trying to build.

WACOAN: How can someone take advantage of coworking at Hustle, and what’s the value of coworking?

Passavant: It works in a few different ways. It’s 24/7. Every day you can come in. We’ve got memberships, so you can be a part of what this is. There’s multiple coworking options in Waco, which is awesome. We work really closely with all the other ones. If you’re looking for a certain type of work environment, we’ll point you to another coworking space that we think would be better. If [the other coworking spaces] come across someone who wants something else, they’ll send them here. If you want to do a certain type of event or gathering, we’ll point you [in the right direction]. We all work together really well together.

But office space and density is important, flexibility’s important, cost and affordability is important, so we offer everything from a floating desk membership to a dedicated desk membership — where you have your own space and you can lock things and keep them here and keep your computers here and everything and be safe — all the way up to private offices. If [your business is] one or two or four people, you can have a private office to work out of. So that’s one thing. But then we also do things like, every Wednesday it’s free for anyone to come in and work in the community. If you just don’t want to work in a coffee shop, you can come here and there’s free coffee and great internet and free printing, and you can come and do what you need.

WACOAN: Free for everyone? Can I come here on Wednesdays?

Passavant: Yeah. Everyone. It’s open to the community every Wednesday, all day. The hope being that, again, that principle of density, you come in, you work, you need someone [to help with an issue], and then you figure it out. It’s not fast work, but it’s important work to just provide a space to come together, and you start building relationships, which is how businesses really progress.

The groups that founded Start Up Waco, they felt that it was very important to have a physical location as a central outpost, which I think was a great call. Because if you don’t exist somewhere physically, then it’s hard for people to understand that you exist at all. You need a gathering place. You need a hub.

We see a trend in the workforce. The American workforce is moving somewhat away from the salaried employee into more of what they call the gig economy, where people are able to sort of do a lot of different things. And maybe part of that is having a salary job, but maybe they’re doing something on side.

WACOAN: Like me, writing for the Wacoan.

Passavant: Yep. They call it the side hustle.

WACOAN: Everyone’s got one.

Passavant: Everyone’s got one. So this doesn’t just have to be for your job. This could be for that side hustle. So maybe you don’t want to work at home, or you don’t want to work out of a coffee shop all the time. And the benefit of just having a space, even though it’s pleasant to work in, it’s the density of other entrepreneurs doing things that I would say is the real value of coworking. You see coworking as a trend across the world, really rapidly growing where huge companies are moving away from the large footprint, multi-year lease, static form of what an office looks like to have something that’s flexible and modular and promotes this kind of interaction. We certainly saw that in New York with the rise of a lot of big companies that just capitalize on it, and their big growth was not due to just small businesses signing up. It’s to the huge corporations coming in and changing how they work. I think they recognize the benefit of having a density of community, of flexibility. I think that would be the biggest benefit. Certainly, it’s a great space, but it’s also about being part of the community.

WACOAN: How does the mentoring aspect work?

Passavant: This is one of the core things that we’re still developing. It has existed in the past where it was just a very simple system of if you want to go online — and you can still do this —you go online, you say, ‘Here’s what I need help with,’ and then it connects you, based on your category of business, to a list of our mentors that have chosen to sign up with dedicated times, and you just make a connection. If you went online today, you could still do that.

We are working to make it a lot more robust than that. We basically want to cast a really wide net and say, ‘Wherever you are in your entrepreneurial journey, wherever you are in the process of starting or growing or just developing your business, Start Up Waco is a place to come and say, ‘OK, here’s where I am, and I have questions.’

We’re developing and training our team as sort of an intake, so we’ll sit down with anyone and everyone. You can walk in, you can call ahead and schedule a meeting, you can email info@startupwaco.com and set up a meeting. You’ll meet with someone from our team. We’ll spend a few minutes together, or schedule a phone call if that’s easier, to understand what your needs are, what you’re looking for, how we can help. And then we have a whole database of mentors in the community that have said, ‘Yeah, I’d be up for doing it.’ So hopefully we can make a much more intentional connection. And then that relationship can either continue, or it can just be to go in and get 30 minutes of free advice from someone who’s done what you’re doing.

All the mentors are individuals that will go in and align in different sectors. Let’s say you have a business, and you’re trying to figure out the financing of your business. You think, ‘OK, I want to grow, I need to make more of this product to be able to sell more, but I’m stuck in this working capital gap where I don’t have the money to invest in the product, so I can’t make the sales. I’m just in this challenging cycle.’

Typically, what you would do is try to find out how to solve that cashflow problem, but there’s a lot of different ways of doing that, so meeting with the mentor specifically about finances, maybe they are coming from a bank or maybe they’re a business owner, a previous business owner. You can talk through experiences.

It’s all in good faith, but we have a lot of strict guidelines where the mentors are screened meticulously by us. It’s not a chance for them to sell you on anything. They’re not going to push their [business]. This is truly them giving to the community. We’re really clear about that because this only works if people show up at this space willing to give and receive. If you just come here looking to take things, this isn’t for you. But if you’re here, and you look first, ‘How can I support this community?’ and then, ‘What can I also receive from it?’ Then I think you’ll really thrive. And if we have a community of people looking to give to each other, then I think we could see things happen quickly.

WACOAN: And getting mentored is completely free? It’s not part of your memberships?

Passavant: It’s a free service to the community, anyone in the community. We’re hoping to really serve and support entrepreneurs that are living and working in McLennan County, but we’re not going to turn anyone away. It’s completely free.

We don’t receive any city money or county money. We’re privately funded as an organization. The city and the county were integral in us having this space, but our operating budget is privately funded through businesses and individuals who have said, ‘We want to see this happening.’ We get support from various foundations, and all three of the chambers of commerce in the city help us do it, but not through financial terms, just through sort of in-kind help. We’re here out of the will of the community truly, not as a government organization. We have the ability to operate with a mandate that is very precise of serving entrepreneurs. Everything we do will be to do it to that end, and certainly mentorship that is free and effective and helpful is a huge part of that.

WACOAN: How can someone become a mentor?

Passavant: The easiest way is to email info@startupwaco.com.

WACOAN: What are some of the events that Start Up Waco hosts?

Passavant: Events would be one of the biggest things that we do. We host all sorts of workshops. We’re constantly out in the community saying, ‘What are the specific skills, what are the topics, what are the gaps in your understanding or your knowledge base that could be helpful as you’re running your business?’ We do workshops that are everything from protecting your IP [address] and we bring in lawyers to help you understand the legalities of starting your business, to your corporate structure as a company to when should you incorporate. Should you incorporate? What does that mean for you? All the way to understanding basic financials, all the way to digital marketing costs and strategies and content marketing strategies, all the way to brick and mortar help, understanding real estate issues. We try to cast a pretty wide net, but I would say that they’re mostly focused toward sort of pre-revenue or very early-stage companies. We’re moving into a little bit more for later-stage companies, talking about scale, but we’ll get there.

WACOAN: I saw that you hosted Claire Diaz-Ortiz, one of Twitter’s early employees in charge of social innovation, on October 9. That’s pretty cool. How did you get someone of that caliber?

Passavant: As I said, 10 years ago when all of these organizations, like Start Up Waco, were popping up in cities around the country, certain organizations outside of them kind of popped up to help support. We belong to several national organizations that help us convene, they help us get the right kind of speakers and stuff.

We’re sort of tagging on to something she’s doing at Baylor. That’s how we got her. She is coming in for that. We get her for an hour. So that’s a really interesting example of you get to hear from someone of that caliber, who was part of the founding of Twitter, come and talk to a group of less than 50 people.

That’s just one [event]. Events are literally happening every week, all different types of events. You can go on the website. There’s a whole list. And there’s a guarantee there’s going to be something for everyone.

WACOAN: How is the operating staff at Start Up Waco organized? Is it a small team?

Passavant: We’re a small team of three. There’s Jillian [Ohriner]. She manages [Hustle Co-Working] space, so she manages the memberships and makes sure that we have coffee and we have everything that we need here and answers all the questions and makes sure that everything for all the events are set up. Then she also works on our communication strategy. She’s working on a lot of the social media and just how we’re getting the word out about everything.

Then Carole Fergusson has been here the longest. She’s been here over a year. She’s seen it kind of from the beginning. She’s the manager of all the events and programs. If you want to be a part of an event here, you’re getting an email about an event, that’s all coming from Carole.

And I try to make sure that we’re doing what we’re called to be doing as an organization by our board. We have a very involved and committed and excellent board of directors. These are all professionals, business owners from the universities, from kind of all around the community. For really important things, we’ve got extra help from people, whether it’s legal or it’s anything to have them filter through. We’ve got a very deep bench of support from our board. They’ve always been available to help and support, so we can do a lot with a small team.

WACOAN: At my day job, we work with thousands of small business owners every day, and I think being an entrepreneur is such an admirable, courageous thing, because it’s incredibly exciting but also risky.

Passavant: I think you explained it perfectly. It is exciting. And it is risky. Just because [your business has] raised a ton of money or it’s valued at a lot money doesn’t mean it’s not going to be worth zero tomorrow. It definitely takes a certain type of worker, certain type of person who can found a business, be a founder. It takes a certain profile.

Part of what we’re doing here is not saying you have to be an entrepreneur or founder of a company to come in here. No. We want to even talk through that ideation process for you to discover, ‘Is this right for you?’ And you might come to the end of the road and say, ‘The only way I can do this is by starting a company. That’s what the right answer is.’ Or you come to the road and say, ‘Oh, this wasn’t a company. This was just an idea that can be a hobby, and there’s really no way to make money at it.’ Part of that ideation processes and feasibility process is something that we can help with, and we’ll walk through.

Make no mistake. It takes no less courage to start up a franchise, to open up a barbershop, to open up a food truck, to open up a pop-up food mart than it does to launch some large tech company that raises a ton of money. An entrepreneur across the board is somebody who’s taking a risk. Now there’s a lot you can learn as you’re doing it to give it the best chance for success. We want to try to help people at every stage of that process. Realizing that for some people, they might come in and say, ‘Oh wait, this is not what I thought it was.’ And it’s definitely not as fun and simple and easy as a lot of people think. There’s a lot of entrepreneurs that they’re one of the mentors, and maybe we’ll hook them up, be like, ‘OK, this is great, but let me walk you through what it’s really like and what my experience has really been, and maybe this will help inform your next steps.’

WACOAN: Where are you originally from?

Passavant: I grew up in Pittsburgh and went to [college] just outside of the city. Then I moved to New York [City] when I was 22, just after school.

WACOAN: Where’d you go to school?

Passavant: ‘Bout an hour outside of Pittsburgh at a small liberal arts college called Grove City College and majored in business and was sort of looking at different grad schools. I was looking at MBA programs. I was looking at a seminary, potentially. I really didn’t know what direction I wanted to go and had an opportunity to move to New York to do none of those things and work in the fashion industry. So I thought, all right, I could give it a shot for a few months and see how it goes and then get on with my life. But it ended up being 18 years.

WACOAN: What brought you to Waco?

Passavant: I really wasn’t looking to move or anything, but my wife, Jenny, is from Waco. She grew up in China Spring. I was looking into something completely unrelated and came across Start Up Waco for the first time. They happened to be looking to hire an executive director, and I read through the job description and thought, ‘Man, that’s really interesting,’ like thoughtful, well-put together case for what they’re looking to do. I don’t have a lot of direct experience in a public-private partnership organization like this one, but I had some experience working in different accelerators, certainly being an entrepreneur, working with a lot of small business networks, so I was familiar with it somewhat. I was able to get some more information, and it kind of grew from there.

WACOAN: What is your background related to entrepreneurship?

Passavant: When I stepped out of my comfort zone in my own town in Pennsylvania and moved to New York, I went to work in the fashion industry as a model and not really knowing what that was. Kind of had to learn through the process of that industry, which is actually, you’re an independent contractor. You’re basically starting your own company as representing yourself and you’re facilitating through these agencies, and every agency works within its own market. You’re all of a sudden working with five or six or 10 different agencies around the world, and you’re the one who’s having to manage that and process it and work with everything from billing and rates. You really are kind of running a business with maybe a small safety net of having an agency that is experienced at doing it. That was my first sort of experience with working for myself.

But then through that process, being in New York in the mid-2000s, having a little bit of money and interest in what was happening in the business community, it was an amazing time. A lot of the tech companies were coming to New York, and things were really kind of booming there. I was an early investor in a few technology companies, and I got to understand what the process was of forming it. From that I started a nonprofit within the fashion industry. That was my first actual company that I started.

WACOAN: What was the nonprofit?

Passavant: It was in the fashion industry, and it basically worked with all the different individuals and entities in the fashion industry. So those agencies I was talking about, the models, photographers, creative agencies, magazines, brands, bring them all together to organize around different service projects around the country. We started in 2006, less than a year after Hurricane Katrina hit in New Orleans, and we took a huge contingent of people from New York down to New Orleans to build homes and give money and help support the local community. And then we did things around the New York area. Not formal chapters, but different chapters of it in different agencies kind of sprung up and did some other things.

WACOAN: Is it still in existence?

Passavant: It’s in existence in the chapter form. I left. It was a lot of work. Nonprofit doesn’t mean non-profitable. You want to be profitable as a nonprofit. It just means that you’re not distributing those profits. You’re keeping them in the business. Once it got to a certain place, it was either jump in and really try to make that your thing or move out, and I didn’t really feel like I was done trying new things. I was part founder in a couple of different things. Most of them didn’t go anywhere, but then one ended up working, which was a fashion brand. It was started by essentially two of us, and that had been going on for the last seven years, and that’s still in existence.

WACOAN: What’s the brand called?

Passavant: It’s called Passavant and Lee. It’s my last name and my business partner’s last name. We make leather goods for men. We make [all our products] in the [United Kingdom]. We were building a supply chain business, trying to find a way for old historic tanneries and skilled labor to interact and operate with these new digital direct-to-consumer companies. We were initially focused on just kind of building our brand, like doing it ourselves.

WACOAN: Why in the U.K.?

Passavant: He was from London, and it was the luxury space. London has a really amazing preserved culture of skilled labor through their apprenticeships. It’s a very valued and honored thing, learning a trade, learning a craft, whether it’s custom tailoring or leatherwork, so we felt like it was a great place to kind of start. Figure out how do we preserve that attitude, that process in a digital world where everything has to be fast and everything has to be new and everything has to turn over quickly. How do you preserve that? So that’s what we were working on.

WACOAN: Since your wife is from China Spring, how did you to meet?

Passavant: She is a very fortunate person — she knew exactly what she wanted to do in high school. She wanted to be a fashion designer. She wanted to work for Ralph Lauren.

So she graduated from China Spring [High School] and moved to New York, went to the Fashion Institute of Technology (which is one of the best design schools in the country), got her degree there and did an internship at Ralph Lauren and was hired as the youngest designer they ever hired in the history of the company. Her degree is in menswear, so she started in menswear design and then that moved into denim design and then that moved from men’s denim to women’s denim. By the time she left after seven years, she was essentially the head of women’s design for one of their labels, a women’s collection.

I had done a lot of work with Ralph Lauren in my career as a model and then through the nonprofit that I started. The Polo Ralph Lauren Foundation and the brand itself were sponsors and supporters, so I had a lot of connections there.

But we met in New York and got married here in Waco. And then her family is still here, her parents anyway, so it was a fun connection.

WACOAN: Is she still doing fashion in Waco?

Passavant: Yeah. She launched denim as a category for a brand that’s based in Nashville called Able, and they’re a for-profit social enterprise. They’re a brand for women. They do clothing and leather and denim, shoes, jewelry. They have a very high standard of responsibility when it comes to their sourcing. It’s really cool for her to work for them, and she designs and curates all of their denim.

WACOAN: When did you start with Start Up Waco?

Passavant: I started at the very, very end of August. So yeah, right in the heat. I thought the tail end of the heat, but apparently right in the middle of the heat.

WACOAN: How is your family enjoying living in Waco?

Passavant: It’s great. We live close to downtown. It’s been really hot up until, like, yesterday.

It’s been really nice. You never know until you get into a place, into a community what the people are really going to be like and what the spirit is really going to be. Having been here now just a couple of months, I’m very hopeful and excited and pleased with the caliber of the people here.

WACOAN: What are a few of your favorite things about Waco you’ve found in your short time here?

Passavant: I love a lot of the restaurants downtown and art galleries. My wife and I try to go out and spend an evening together every week. We’ve had no problem finding fun things to do, whether it’s going to Cultivate 7Twelve or eating at all the restaurants downtown.

Now that the weather’s starting to cool off, I think we’re going to start going on some walks. We love Cameron Park. We love running around there and take our boys, [Ethan and James].

WACOAN: Is there anything else I need to know?

Passavant: I think it is important to know that Start Up Waco is here to serve entrepreneurs, not just startup businesses, but all entrepreneurs. We’re going to be a success to the extent that we can serve all the entrepreneurs in the region well. Our big task right now is to understand where the sticking points are, where the real needs are, and let us rally our resources around you as an entrepreneur to help create the infrastructure and the type of ecosystem that you can really thrive in.

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