Can you name the top four ports in the United States? Los Angeles and New York-New Jersey are obvious guesses for Nos. 1 and 2; Long Beach, comes as no surprise at No. 3. But Savannah as No. 4 (by container weight, according to 2009 Census data) is unexpected—as are many other aspects of this entrepreneur-friendly city.
Founded in 1733, Savannah’s fertile environs grew cotton in abundance, while its snakingly convenient waterways to and from the Atlantic Ocean gave rise to a powerful port that has dominated ever since. During the Civil War, Sherman’s notorious "march to the sea" culminated in Savannah before heading north to ultimate victory; Savannah surrendered on Sherman’s arrival, preserving much of its historic downtown from destruction. Today tourists throng the city’s genteel streets.
Capitalizing on its port, Savannah is still strong in manufacturing: It counts jetmaker Gulfstream, International Paper, and construction equipment maker JCB among its corporate titans (not to mention that queen of unhealthy Southern cooking, Paula Deen Enterprises). Meanwhile, its startup scene is rife with technology, e-commerce, and graphic and motion design firms like Rails Machine, CommerceV3, and Paragon—a niche further fortified by the Savannah College of Art and Design (SCAD) and Georgia Southern University.
What can the "Hostess City of the South" offer startups next? We talked to Steve Weathers, president and CEO of the Savannah Economic Development Authority (SEDA) to find out. Here, he shares five things you need to know about starting a business in Savannah.
Think of Savannah as one mighty supply chain…
The Port of Savannah’s dominance springs from its convenient location: close to the Atlantic, I-95, and inland waterways and railroads that run west from the waterfront. As a result, it's able to feed an entire supply chain. He cites Coastal Logistics Group as an example of how the port helps weave together related industries: "They’re a UPS on steroids," he says. "They take a big piece of equipment and package it up for shipping [inland]. Or if you need it unboxed and assembled, then shipped to you, they’ll do that too." Quite a few manufacturers—like Mitsubishi Power Systems, JCB, Imperial Sugar, and Diageo-Guinness Brands—opened key locations in Savannah to stay close to its massive distribution capabilities. The city is horizontally integrated, too: International Paper complements Weyerhaeuser’s bleached pulp products and Arizona Chemical’s pine-based chemicals and resins. Gulfstream operates in a thick military supply chain, which includes Fort Stewart and Hunter Army Airfield.
…that operates globally, in both directions.
A relative newcomer to Savannah, Weathers has been instrumental in two key SEDA projects: joining the World Trade Center Association and launching SEDA Ventures, their VC arm, which goes live this summer. Weathers’ goal is a "fully integrated economic development chain," he says. "If you walk in and say: Here’s my great technology, we’d look at that opportunity and assess where you need to go next. We could help you get into international markets [via the WTC Association], or we can get you an equity infusion via our VC fund." That might mean helping you sell your newfangled mobile technology in Japan, say, or insourcing manufacturing from a foreign firm who’d benefit from Savannah’s transportation network in the states.
Weathers came to Savannah from Toledo, where he founded and ran Rocket Ventures, a $22 million venture fund that he says launched 80 local companies during his tenure. Rocket eventually joined forces with the University of Toledo, shuttling innovations from the classroom to market—a model Weathers wants to replicate in Savannah. In looking for small-time ventures with outsize promise, Weathers says, "we’ll play above the angel investors but below the A-level funders." SEDA Ventures’s own cash investment will provide larger funders with a locally based watchdog and make them more likely to chip in their own funding, Weather says. "Lots of VC aren’t interested" in new businesses in second-tier cities like Savannah, Weathers says. "But they could be if they know they have boots on the ground there."
Southern hospitality is legit, y'all.
Southern gentility is alive and well in Savannah, even in the business community. Numerous organizations work together to support area startups, whether it’s ThincSavannah for co-working space, Savannah’s chapter of Startuplounge, a startup incubator for Georgia businesses, or The Creative Coast, supporting "creative and innovative businesses" in Savannah. (They also co-sponsor TEDxCreativeCoast in Savannah, which rolls around for the third time on May 18.)
For untapped brainpower, look to Savannah's universities.
Savannah College of Art and Design ranks among the nation’s leading design universities—impressive for a city of only 130,000 people. Yet Weathers believes the university’s brainpower has only been barely tapped to drive local businesses. "I toured SCAD’s facilities recently," Weathers says, "and learned about 40 different technologies with potential in the marketplace. We could create 40 brand-new technology companies right there." Cross-pollinate a SCAD design team in fashion with, say, talent from the material sciences lab at nearby Georgia Southern University or a powerhouse engineering teach from Georgia Tech, and you could make the next smart fabric.
Watch your wallet (and the weather report).
Savannah is plagued with many of the ills New Orleans is also known for: indifferent-to-bad public schools, high risk of floods and hurricanes, considerable poverty and surprisingly high crime—it ranks in the nation’s top 10% for violent and property crimes. Liberals may cringe at the idea of living so deep in red-state Georgia (although with Atlanta, Athens, and Savannah, you’ll find plenty of folks with an independent streak). Talent may need to be lured here from bigger hotbeds, but luckily Savannah isn’t deficient on other charms.
"What do people think of when they think of Savannah?" Weathers asks. "They think of the port, all its history, it’s a beautiful place. If I asked you about San Diego, you’d say right away it’s a technology mecca. We can make that happen here, too. Savannah is a hidden jewel; the opportunities [it offers] are just surfacing."
[Image: Flickr user Stuck In Customs]