From the Aztec capital of Tenochtitlan to Chang’an in ancient China, from the city-states of Renaissance Italy to Alexandria, Baghdad, London and New York, the world’s great urban centers have always been crucibles for change and engines of innovation.
And the phenomenon is no less vital today as young, digital, high-growth businesses have become increasingly critical to the economic success of the cities they choose to locate in.
Vibrant startup ecosystems are important not only for growth and jobs but also for a city government’s ability to solve local problems and run itself well. For a number of cities embracing this growing sector of their economies, a positive feedback loop exists between innovation and entrepreneurship outside city hall and good governance—including both policy and delivery—within it.
Once relatively closed and insular environments, leading municipal governments around the world are now looking to engage with outside ideas and innovators to support their growth, improve city services and create new solutions to complex problems—revolutionizing the way the city works and engages with citizens.
However, this kind of transformative change is often difficult. Traditional policy-making approaches, characterized by inertia, process complexity and bureaucracy, can make keeping pace with a rapidly shifting technology environment difficult. City governments also often lack the direct policy-making power and budgets to bring about change in areas most important to entrepreneurs, such as access to talent, capital and attractive standards of living.