Entrepreneurs inventing Alaska’s future

By Nolan Klouda, CED Executive Director

This content originally appeared in the Alaska Journal of Commerce

 Ben Kellie of the Launch Company

Ben Kellie of the Launch Company

As co-founder of The Launch Company, an Anchorage-based startup, he thinks Alaska could become a leader in the commercial space industry.

Working for Elon Musk’s SpaceX after college, Kellie was part of the engineering team for several commercial launches. He noted that each launch pad had to be built almost from scratch for each company sending a rocket into space. “Imagine if every airline had to build its own airport, the cost to fly anywhere would be astronomical,” he says.

Much of this young industry focuses on creating newer and better rockets but overlooks the inefficiency and complexity of the launch itself. That’s where The Launch Company comes in. Kellie and team use a standard set of operating principles gained from past experience helping design and build multiple sites to simplify the process.

As an example, the company designed fueling fittings (now built in Palmer) that can be used across many different sizes and types of rocket. They are robust, reliable, and prevent the companies from having to design their own custom hardware, saving time and money. He likens these to USB chargers for phones as an improvement over the first generation of cell phones that had a bewildering array of different cord types.

As I write these words, entrepreneurs like Kellie are working on the next Alaska economy. In addition to commercial space, Alaskans are developing marine and aviation technologies, renewable energy systems, virtual reality and augmented reality startups, innovative food and drink businesses, and products used in outdoor recreation — to name just a few.

We have a community of specialized investors who understand the risks and dynamics of putting cash into startup companies. Our ecosystem of support organizations includes an engaged university system, all levels of government, and — most importantly — entrepreneurs who help other entrepreneurs through collaboration and mentorship.

Fortunately, Alaskans are a very entrepreneurial group. In 2017, Alaska ranked third among the states for the number of businesses launched per capita, according to the Kauffman Foundation.

We also lead the way in closing the gender gap in business ownership, traditionally a male-dominated pursuit: Alaska has the highest percentage of women-owned firms of any state. Altogether, startups in Alaska create 4,000 to 6,000 jobs each year, accounting for the overwhelming majority of net private sector employment growth during most years.

There is still work to be done to empower Alaska’s entrepreneurs, however. Workforce shortages in key areas like software development limit the growth potential for high tech startups. The state ranks near the bottom for knowledge jobs, as defined by the New Economy Index.

Despite being a national leader in launching companies, Kauffman ranks Alaska fourth from the bottom in scaling up, defined as growing to 50 employees within 10 years. We start plenty of businesses, but they tend to stay small.

Yet Kellie sees unrealized potential in the Alaskan spirit of adaptability and ingenuity. His father ran an air cargo business throughout Bush Alaska, and he learned early to adapt and improvise, to patch things together with proverbial duct tape.

The same kind of on-the-fly critical thinking helps him resolve some of the complex engineering problems that arise in planning for a rocket launch. “I’d like to catch that in a bottle,” Kellie says of the Alaskan entrepreneurial mentality.

We rely on entrepreneurs to glimpse over the horizon and see what’s next. How might self-driving cars change the way we get to work and run our errands? How will virtual reality-based training change the way we learn? What jobs will the new high-tech industries bring?

We may not know exactly what that next economy will look like, but we can be reasonably sure that entrepreneurs will be the ones who usher it in.