What We’ll Cover in This Piece:
- Recent innovation investments in Houston
- Potential for innovation in Houston
- Existing support ecosystem for entrepreneurs
- How to get involved
Last year, the City of Houston and Rice University began working on a $100 million Innovation Hub, dubbed The Ion. The hub will use the 270,000-square-foot former Sears and will boast amenities like: co-working spaces, classrooms, meetings areas, offices, hardware and software labs, and restaurants.
By late 2020, construction is expected to be complete, according to Rice University. The Ion will be part of an entire 4-mile Innovation Corridor between downtown (with the oil and gas industry’s headquarters), the Texas Medical Center (which will house its digital initiatives there), and the Rice University campus.
“The location is right between the center of the energy capital of the world and the center of Houston’s medical industry, which some call the medical capital of the world — all on the rail line. It's going to be a game changer,” explains Jim Lawnin, a Managing Partner at BBL Ventures. Jim is an active angel investor and board member/energy sub group co-lead of Houston Angel Network. He was also the IBM Lead Account Partner for ExxonMobil where he implemented emerging solutions in blockchain and advanced analytics.
Perfect for Entrepreneurs
Houston is the fourth largest city in the US — and energy capital of the world. According to a 2016 Advanced Energy Economy report, the global energy industry surpassed $1.4 trillion ($199.2 billion of that in the U.S. alone), with oil and gas being a large segment.
The oil industry lags behind the rest of the corporate world when it comes to technology, and industry leaders finally understand the need to adapt technology.
“What we're seeing is major transformations within the oil and gas industry, largely because there are so many things disrupting the industry. Instead of peak oil supply, we now have peak oil demand. Companies have to learn to become more agile in order to survive,” explains Jim Lawnin.
With this mandate to innovate, the need for technology specific to this industry, and the city’s investment in the Innovation Hub and accelerator programs, Houston is an ideal place for entrepreneurs who want to carve out a niche.
“If you're a tech entrepreneur looking for opportunity, you've got one of the biggest industries in the world that's behind in innovation; the opportunities are enormous,” Lawnin says. “There's no city where one industry — like oil and gas — dominates like Houston.”
Tapping into Angel Investors and Houston’s Accelerators
During the past 5 to 10 years, Houston has created a support ecosystem for innovation and entrepreneurs, tapping into the:
- Houston Angel Network, a nonprofit connecting entrepreneurs with investors that facilitated more $73 million across more than 235 deals since 2001, with $12 million invested in 43 deals in 2015.
- Early stage investors like Goose Society of Texas, Cannon Ventures, and the Rice Angel Network
- Private capital, including Houston’s high net worth individuals, who are looking for opportunities to shift some of their portfolio away from oil and real estate and into tech.
- Private equity firms. These investors see energy tech (“EnTech”) as the next FinTech industry because of similar opportunities and likelihood of major growth. (“FinTech,” refers to structural change and digitization within the financial services industry and was created by disruptors — startups and businesses without bank licenses. Total investment in FinTech over the past three years topped $122 billion.)
How to Get Involved
Houston — because of its angel network, wealth, proximity to the energy industry’s center, and investment in infrastructure — is starting to attract high-tech talent.
“I co-lead the subcommittee for the Houston Angel Network, and I'm constantly seeing start-ups trying to get into the energy industry with new ideas,” says Lawnin. “It's amazing, the technologies and the ideas that people are coming up with, from facial recognition to satellite imagery to sensors. I think the innovation in the city of Houston over the next five years is going to change not only the energy industry, but numerous other industries, too.”
If you're interested in learning more about BBL Ventures and how we can help, click the link below.
If you think you can solve one of the industry's pain-points identified in ExxonMobil's robotics pitch competition (opening process equipment or reducing arc flash), see details and apply here.
If you have a robotics startup (outside of ExxonMobil's pain-points), apply for our first accelerator track here.