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Ensuring that everyone in St. Louis benefits from the city’s innovation boom.

St. Louis has always been a city of entrepreneurs. From German American beer baron Adolphus Busch to African American hair care mogul&nbsp;<a href="https://en.wikipedia.org/wiki/Annie_Malone" style="background-color: rgb(255,255,255);">Annie Malone</a>, St. Louis has known how to capitalize on talent and ideas. The city is doing it again today. 

St Louis is in the midst of an entrepreneurial boom. Start-ups in information technology, financial services and life sciences have sprouted, supported by a regional ecosystem of research hubs, talent, and business along the city’s “central corridor.” An eight-mile stretch heading west out of downtown, the corridor has been&nbsp;<a href="https://www.brookings.edu/blog/metropolitan-revolution/2016/05/05/in-st-louis-a-gateway-to-innovation-and-inclusion/">called the engine of growth</a>&nbsp;and the “<a href="http://www.bizjournals.com/stlouis/news/2017/01/06/table-of-experts-the-central-corridor.html">cradle of the St. Louis region</a>.” Home to clusters of start-ups, universities, a medical center, and other anchor institutions, the central corridor is breathing new life into the city and region.
The city’s burgeoning innovation community and the presence of more than 3,000 Mastercard employees in the area, were two reasons for the Mastercard Center for Inclusive Growth to make St. Louis a stop on its “On the Frontlines of Inclusive Growth” tour of US Cities. &nbsp;Co-hosted with the&nbsp;<a href="http://cortexstl.com/">Cortex Innovation Community</a>, an “innovation hub” founded in 2002, a panel discussion in St. Louis brought together entrepreneurs, civic and business leaders to discuss how technology can help promote inclusive growth and ensure that new advances in the region’s economy reach all communities and people in the St. Louis region.
A Divided City
Although St. Louis has made great strides, it remains a divided city. Opportunity is not reaching everyone. North of Delmar Boulevard, a major east-west route in the city, is a predominantly African-American community where abandoned buildings and poverty prevail. As a resident described the gulf&nbsp;<a href="https://urldefense.proofpoint.com/v2/url?u=http-3A__www.bbc.com_news_magazine-2D17361995&amp;d=DwMFaQ&amp;c=uc5ZRXl8dGLM1RMQwf7xTCjRqXF0jmCF6SP0bDlmMmY&amp;r=1w_KPrwhHAkW-f99e2IxirV3JnMSl4igvnYSdq4Mw9o&amp;m=wdMlzgwRPIuWB_h9s9dGghBvJMkxfOusLu1Pr50y5os&amp;s=Efv9DFN4kJIqaFVXHt-d4g9AKlRg3b4uwAyr-gnssEA&amp;e=">to the BBC</a>, “You are slapped with the reality that economically you have entered into the twilight zone,” he said of the area north of Delmar. In contrast to the south, he said, “You got million-dollar opportunity.”
That divide is clear in the statistics. The median annual household income north of Delmar Avenue is $18,000 while it is $50,000 south of Delmar, according to the BBC report. Only 10 percent of residents north of Delmar have a bachelor’s degree, compared with 70 percent south of Delmar.
There’s an opportunity to close the divide, the panelists agreed, by enabling greater access to the opportunities that the newly created innovation hubs are producing in the Central Corridor and beyond.
Access to Opportunity
With its clustering of capital, ideas, and experience, the Central Corridor and its powerhouse of universities, health care systems, and major industry headquarters has created the conditions for entrepreneurs to thrive. The&nbsp;<a href="http://cortexstl.com/">Cortex Innovation Center</a>&nbsp;is one of those benefactors. A concentration of more than 300 innovators and entrepreneurs, Cortex is contributing to an “entrepreneurial density” that jumpstarts creativity, says Dennis Lower, Cortex’s Innovation Community’s president and CEO.
In addition to the intellectual capital the corridor benefits from its surrounding neighborhoods rich in history, arts, and an emerging food scene—a place “where innovation, tech, culture, and community collide,” said Lower.
But to ensure that the benefits of St. Louis’s growing innovation engine reach north of Delmar and elsewhere will require a continued conversation between industry and community organizations, all agreed. One solution, an audience member suggested, could be to locate satellite hubs of the major firms in neighborhoods, bringing much-needed jobs and access.
Toward that aim, Ginger Imster, vice president of Innovation and Entrepreneurship, St. Louis Economic Development Partnership, said her organization is overseeing the expansion of an incubator north of Delmar. She also pointed out that the strengths that innovators can leverage are not necessarily always the traditional “cluster” strengths. In the case of the incubator satellite, it is near a metro stop, a workforce development center and a child care center. Washington University a few blocks south could also become a source of mentors. “It’s clustering in different contexts,” Imster said, that can make a difference in people’s lives.
“Clearly, the conversation about equitable development has just begun,” said Dennis Lower, who was moderating the panel.
Access to Financial Services
Jobs and economic development opportunities are not the only ingredients of inclusive growth. At its most basic, having access to a bank is critical to economic security, and here the United States lags many of its peer countries. Without such access, people cannot begin to “build something,” said Radhakrishnan Gopalan,&nbsp;professor of finance, Washington University St. Louis.
Unfortunately, said Gopalan, “The US has the notoriety of having 6-7 percent of its population who lack access to basic financial services.” In contrast, only about 1-2 percent of Northern and Western Europeans lack a bank account, according&nbsp;to the&nbsp;<a href="http://www.worldbank.org/en/programs/globalfindex">World Bank’s Global Findex</a>.
The high transaction costs of alternative sources of money such as payday lenders are only one impediment to building wealth, said Gopalan. He also finds that low-income families are less likely to take risk as a result of financial constraints, and they earn much less return on their money than the more affluent as a result. All this contributes to an inability to build wealth.
Building savings and capital is even more important today, said Ray Boshara, director of the Center for Household Financial Stability with the Federal Reserve Bank of St. Louis. Increasingly a person needs access to other forms of capital to build a good life, whether that be social, intellectual, or environmental capital. “If you have money you can buy these goods,” he told the audience. “If you lack access to that capital, inequality is likely to increase.”
Fostering the ability to seize opportunity when it arises
Ensuring access is critical, but not enough the panelists agreed. “If you’re not prepared when opportunity presents itself, it doesn’t matter how much access you have,” said Lower.
And being prepared for opportunity, Ginger Imster believes, is about first overcoming what Harvard Professor&nbsp;<a href="https://www.amazon.com/Scarcity-Science-Having-Defines-Lives/dp/125005611X/ref=sr_1_1?ie=UTF8&amp;qid=1493243779&amp;sr=8-1&amp;keywords=scarcity+sendhil">Sendhil Mullainathan</a>&nbsp;coined as the “scarcity mindset.” “When you’re just trying to survive, you’re never open to being prepared for that opportunity because you are so tired, so hungry, so scared,” she said.
“Where I have the greatest hope is that technology becomes an equalizer of access,” Imster said. If technology can enable access and opportunity, it could be the “flywheel for that individual to fundamentally shift how he or she sees opportunity” and escape the scarcity mindset.
The new economy emerging in St. Louis holds unprecedented potential to improve the lives of marginalized communities. With continued public and private collaboration and attention to issues of equity, the region can drive towards a future where all growth is inclusive.

Connecting Innovation and Inclusion in St. Louis’s Startup Boom