The decline of traditional industry isn’t just confined to Chicago or Detroit – it’s a global issue. The shift of manufacturing centres from West to East, the rise of automation and other existential threats have led to years of decline in once bustling cities, creating a dilemma for local governments. How do you rejuvenate these areas and create new business from the ruins?
For some, the answer has been startups. With a good internet connection being all that stands between a business and a global audience, many entrepreneurs are leaping at the chance to occupy formerly derelict properties. These abandoned hubs of old industry are being turned into new co-working and startup hubs – and injecting life into the fallen giants of global business in the process.
All aboard
The poster-child for redeveloping abandoned buildings lies in Paris’ 13th arrondissement, home to the city’s ‘Asian quarter’ and the National Library. Here on the banks of the Seine, an abandoned railway depot from the 1920s was purchased by an enterprising billionaire called Xavier Niel. In 2017 – after four years of development – it opened to international fanfare, and a host of new startups. Welcome to Station F – the biggest startup campus in the world.
Station F has repurposed its retro setting in a conscientious manner, putting a modern spin on its old industrial past. Mezzanines run around the edge of the cavernous hall, with shipping crates above and below, repurposed into small offices and meeting spaces. The offices face each other, with tables and sofas in between, encouraging the occupants to meet in the middle. Rec rooms and canteens complete the effect; although if you’re playing startup bingo, be warned – there’s nary a ball pit or inflatable in sight.
Station F is in many ways the embodiment of a great, modern co-working space. The modern, airy spaces utilise glass walls, verticality and immense horizontal space in a manner that almost feels like a convention hall, rather than a startup hub. Winning a place for your business in Station F is an opportunity in itself: not just to work in a great location, but to display your wares to businesses large and small, and be part of something special.
Motown, mo’ startups
With the backing of a billionaire, its position in popular Paris, and backers including L’Oreal and Microsoft, it’s hardly a surprise that Station F has been a success. But the trend of redeveloping old industrial buildings stretches far further, and to less desirable locations. One such example in in Detroit – now as famous for its 2013 bankruptcy as for Motown and car manufacturing.
While problems started with the infamous race riots in the 1960s, it’s the death of traditional industry that had most hurt Detroit. General Motors remained one of the few major companies in the city, and even they were in trouble, having been bailed out by the Bush administration in 2008. The city’s population shrank by more than 60% in the 60 years to 2010, leaving vast swathes of the city’s metropolitan area unoccupied.
Where some see disaster, however, others see opportunity. With rent for skyscrapers falling as low as $8/sq ft, and smaller properties even lower, numerous startups decided to take the leap. Silicon Valley veterans looking for a fresh start were among the first arrivals, and they soon drove bigger moves. Software company Compuware was followed by financial firm Quicken Loans, who went on a real-estate buying spree. They then gave the spaces over to startups. Nearly a hundred have now moved in, bringing attendant retail businesses with them.
Elsewhere in the city, startups are driving a different kind of renovation. The Detroit Bus Company was a crazy idea hatched by a 25-year-old Silicon Valley escapee. Seeing the inadequacies in public transport, he hatched the idea to buy buses from the state, refit and repaint them, and run private tours of bars and other hotspots. The scheme has been so successful that he’s branched out into multiple ventures – and funded a local group which tidies up and cuts the grass of neglected public spaces.
Fun in the sun
Portugal has always been a welcome home to small businesses, but success in the modern era was harder to predict. An ancient nation of traders and empire-builders, Portugal has reforged itself in recent years as a home for international students and startups. Nowhere has this change been more keenly felt than the capital, Lisbon, where new businesses have capitalised on the tourist economy to transform the city.
The Portuguese government has actively incentivised startups, offering a ‘Golden visa’ scheme for non-EU residents and a 10-year tax freeze for EU residents, respectively. Its other assets are more traditional: Lisbon is renowned for its incredible food, great quality of life, and being one of the sunniest cities in the world. It’s also cheap compared to Europe and the United States’ other startup capitals – a perfect combination for young entrepreneurs.
Startup Lisboa is currently working on a project in the city to rival Station F. A 20-building complex of factories in the once-iconic Beato district, largely abandoned since it was used to manufacture food for Portuguese soldiers, is undergoing a colossal overhaul. The first phase plans to make 35,000 square metres of space available to startups, with the same concrete-and-glass stylings of its rival.
The project – dubbed Hub Criativo do Beato – even has a riverside location to match the Seine. Its founders intend to take it far beyond the Station F concept, however; this startup mega campus is expected to reach 100,000 square metres in its second phase of construction.
It isn’t just Portuguese interests that are investing in Lisbon. 62% of scale-up capital and 86% of later round capital is from abroad – and this investment is being matched in startup spaces. Berlin startup space founders Factory are, fittingly, investing in a Beato factory space of their own. The project is expected to run to 10 million euros, and will open later this year. As with so many other rejuvenation programs, it will preserve much of the character of the original structure – reminding the startups of Portugal’s prior glories as they forge a new path into the future.
The common denominator in all of this is that investors and incubators, not the startups themselves, are driving change. But this shouldn’t be seen as a negative. More and more countries are wising up to the transformative effect international startups can have on dilapidated cities, and are working to incubate this talent. And businesses who made it before the recession, driven though they are by the financial gains, are also being altruistic. Every entrepreneur needs a bit of luck and a helping hand – and a great space can make all the difference.
This post was submitted by Invicta Mezzanine Floors. They are specialists in designing and installing state-of-the-art mezzanines. For over 30 years we’ve catered to every kind of facility, from freestanding single-tier mezzanine floors to complex installations for some of the largest global landmarks and infrastructure projects.