Are We REDI?
Are We REDI? A New Framework For Measuring Tech & Innovation Ecosystems
Many experts and leaders in the ecosystem building field have developed frameworks designed to achieve several outcomes: (1) order out of what seems like chaos, (2) mental models that enable understanding and replication, or (3) measurable components to assess growth, health and other important factors.
To avoid duplicating efforts, as we designed the REDI Scorecard, we considered several ecosystem measurement and mapping methods. Here’s a quick, and relatively painless overview of the most notable models.
When Brad Feld and David Kaplan wanted to share insights on how others might replicate the success of the Boulder startup ecosystem, they wrote Startup Communities: Building an Entrepreneurial Ecosystem in Your City. Feld and Kaplan categorize the common players within startup ecosystems, including entrepreneurs, investors, to local government leaders, university institutions, large companies and service providers, and explore how they interact with each other. Put simply, this approach contends that every actor plays an integral role in fostering the ideal environment for startup activity, with each serving a distinct purpose and role.
Kate Pope Hodel and Maria E. Meyers, co-founders of SourceLink, take a different approach in the book, Beyond Collisions, which we admire for its practicality. They share a model for erecting entrepreneurial ecosystem infrastructure based in large part on their experience in Kansas City, Missouri. Hodel and Meyers break down the typical entrepreneurial journey into four major stages, each represented by one of the Four Quadrants: innovation-led, second (growth) stage, main street, and microenterprise. Similarly, they contend that the controlled growth of an ecosystem calls for four tactical strategies: (1) defining the entrepreneurial identity, (2) connecting supports, assets, resources and opportunities through centralized mechanisms, (3) empowering ecosystem players and builders, and (4) routine data collection and measurement.
Victor Hwang, former President of Kauffman Foundation and Silicon Valley investor, advanced the idea that culture and values are the key ingredients in building the invisible social infrastructure that is a critical element of any innovation system. In The Rainforest, Hwang explains that geographic, socio economic, gender, racial or ethnic or other considerations have no bearing on the fact that good ideas indiscriminately arise from anywhere. Rather, it behooves us to cultivate environments that systematically unlock collective genius from everywhere, understanding that outliers and disruptive thinkers may just be the source of next big innovation. Ecosystems that flourish prioritize, among other things, knowledge transfer (often through university extensions and high rates of corporate R&D partnership), culture (the invisible infrastructure of community) as well as individualized experiences (including small teams).
The Kauffman Index
One of the earliest measurement models dates back to the 2015 Kauffman Foundation’s Measuring an Entrepreneurial Ecosystem, which benchmarks vibrancy in metro areas across 12 primary indicators distributed equally across four categorical groupings. The Kauffman model divides these groupings as follows: density (new and young firms per 1,000 people, relative share of employment in new and young firms, sector density particularly in high tech); fluidity (population flux, labour market reallocation, high growth firms); diversity (economic specialization, immigrants, mobility); and connectivity (spinoff rate, dealmaker networks, program connectivity). To this day, Kauffman’s annual entrepreneurship city index continues to be a trusted comparative tool.
The Aspen Model
The 2013 Entrepreneurial Ecosystem Diagnostic Toolkit produced by the Aspen Network of Development Entrepreneurs is quite robust in that it offers a methodological guidance that spans 10 domains and 65 indicators. Notably, the model encourages practitioners to evaluate policy; finance; infrastructure; markets; human capital; support services and connections; culture; research, development and innovation; quality of life; and macroeconomic conditions. We won’t belabour you here with a comprehensive recitation (but you can visit the index for additional resources and detailed breakdown), the Aspen Model focuses on functionally objective data points, it does include broader cultural determinants in four specific areas: (1) entrepreneurial motivation in society, (2) proclivity for risk, (3) cultural and social norms, and (4) media narratives of entrepreneurship.
Equity Evaluation Tools
Few of these methods center racial equity and inclusion as key drivers of ecosystem building and evaluation. Notable exceptions include Building Entrepreneurship Ecosystem in Communities of Color, a collaborative project between Opportunity Hub and the Kansas City Federal Reserve, as well as the Smart BTE City Assessment Framework, produced by the Center for Black Innovation (formerly Black Tech Mecca), and the E3 Scorecard, an assessment tool that measures the health and equity of an entrepreneurial ecosystem, by Forward Cities, which we adapted to align with the survey component of the REDI Scorecard model as a 64 inquiry point questionnaire.
The REDI Scorecard
Each of the foregoing examples, along with many other articles, books, and diagrammed models, lay a foundation for how we understand tech, innovation and entrepreneurial ecosystems in general. But, they also leave unanswered various practical questions relative to racial equity, diversity and inclusion (REDI):
- How do we define what it means to be REDI on an individual, institutional and ecosystem level?
- How do we assess the REDI gaps, opportunities and priorities ?
- How do we ensure resources are both REDI and accessible to those that need them?
Ok, fancy buzz word aside, think of being REDI as an environment that is characterized by equitable access to opportunities, inclusive distribution of resources, and a culture of belonging.
Tactically, the REDI Scorecard adopts a simplified approach. It assesses an ecosystem through the lens of culture, strategy and assets by examining six subcategories:
- People: the experiences of all personal and identifiable groups in an ecosystem with a goal of cultivating a culture of belonging
- Principles: the ecosystems values and principles articulated in writing and translated in measurable practices
- Priorities: a data driven and goal oriented ecosystem growth strategy with which to hold the ecosystem leaders accountable
- Partnerships: Non duplicative partnerships that equally distribute leadership and responsibility
- Pipelines: How to build unobstructed, contiguous pipelines that make resources and opportunities accessible to all
- Platforms: open source platforms that allow all players to leverages the ecosystem’s assets
Typically, tech ecosystem assessments are top down and not bottom up. But, what makes the REDI Scorecard different is that it explicitly focuses on collecting sentiment and lived experience data. It combines a variety of measurement practices and approaches as well as inclusive data collection methods to generate qualitative and quantitative insights that reflect the experiences, perspectives and input from the most marginalized and prominent stakeholders.
To learn more about how we adapted the REDI Scorecard framework in practice, visit the Methodology.