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Spokane's startup ecosystem transitions from timber to technology, poised for significant growth and innovation. With a burgeoning tech sector and supportive infrastructure, the city's startup scene anticipates a breakthrough, leveraging its resources, talent pool, and entrepreneurial spirit to drive economic development and establish itself as a hub for innovation.
A late-afternoon break in the weather lights up downtown Spokane, looking east into the city from an I-90 overpass. (GeekWire Photo / Todd Bishop)
Washington state’s second-largest city is the hub of an ambitious regional tech community seeking to leverage new realities to achieve its longstanding goals, as GeekWire reports in this special series.
SPOKANE, Wash. — Jack Githens didn’t plan to stay here after college.
A senior at Gonzaga University in Spokane, Githens grew up in Issaquah, Wash., in a part of the region that people in Seattle call the Eastside. He has spent his college years in a part of the state that people in Spokane call the other Eastside or, if they’re feeling cheeky, the real Eastside.
Githens, 22, a business administration major with a concentration in finance, never imagined starting his career in Spokane. But that changed after he connected with the startup scene, led by determined business and community leaders bent on bootstrapping this longtime timber and mining town into a thriving tech hub.
Jack Githens, Gonzaga University student. (Photo Courtesy Jack Githens)
“There’s so much benefit here, being in a small community that has so much startup potential, and so much growth ahead of it,” he said. “That’s what I see here.”
For now, however, he’s an exception among his collegiate peers.
This region is home to respected universities that collectively educate tens of thousands of people, including Gonzaga, Whitworth University, Eastern Washington University, and branches of the University of Washington and Washington State University. But many of those students go elsewhere after graduation.
Business and government leaders have long aspired to make Spokane the type of place that entices new grads to stay.
“Well, that has been the dream,” said Spokane Mayor Lisa Brown, a longtime university professor and former director of the Washington State Department of Commerce, when a GeekWire reporter told her about Githens. “And so you’re making me very happy, to tell me that you just talked to someone who’s doing it.”
Making this less of a novelty will be one of the keys to helping the region’s tech and startup economy realize its potential in the years ahead.
Spokane Mayor Lisa Brown. (Washington State Department of Commerce Photo
We’ve heard this from many of the more than two dozen business, government, and community leaders we’ve interviewed so far for this “GeekWire on the Road” series about Spokane. It’s a case study in one region’s efforts to expand its innovation economy, in the spirit of the “Rise of the Rest” movement to cultivate entrepreneurial hubs beyond the nation’s traditional tech centers.
Spokane’s tech community stands out for its determination and resourcefulness. But the region is also experiencing many of the same underlying forces as other aspiring tech hubs across the country, amid the new realities of post-pandemic work and life.
Here are some of the biggest issues to surface in our reporting so far, many of which we’ll explore in this series in the months ahead.
The new world of remote work means companies based in the region can recruit from a much larger pool of talent. Spokane also saw an influx of workers from Seattle and other major tech hubs during the pandemic. Numerous entrepreneurs have moved their startups to the region, as well.
We’ve connected with several Seattle transplants in Spokane as part of our reporting, plus other entrepreneurs from across the country, whose stories we’ll be telling as part of this series.
Spokane County grew by 7% from 2018 to 2023, to a population of 551,000 as of last year, according to U.S. Census Bureau data. It’s the fourth-largest county in Washington state, and the city of Spokane (population 230,000) is the second-largest in the state behind Seattle (population 750,000).
Venture capitalist Tom Simpson of Ignite Northwest and the Spokane Angel Alliance addresses the crowd at the Ignite 25+5 Awards in Spokane on Feb. 22, 2024. (GeekWire Photo / Todd Bishop)
The influx has contributed to a higher cost of living, which has started to erode the affordability advantage that Spokane’s leaders cite as one of the key benefits of living and working in the region. (Others include easy access to outdoor recreation, the tight-knit and supportive community, and minimal traffic.) The city is seeking to address the affordability issue in part by encouraging new forms of housing, where it’s emerging as a leader in the state.
The growing strength of Spokane’s startup scene was on display during GeekWire’s recent visit to the city — talking with local investors, meeting with startup entrepreneurs, touring established companies, and attending the Ignite 25+5 Awards, with 250 people packing the Barrister Winery downtown.
The annual 25+5 list, created by Spokane venture capitalist and tech community leader Tom Simpson five years ago to elevate the visibility of the area’s startups, recognizes the region’s 25 fastest-growing tech companies, plus five others to watch. The award winners offered a sense for the breadth of startups in the region.
Notable enterprise companies on the larger 25+5 list included Treasury4, which raised $20 million last year for financial and treasury data analytics, and Vega Cloud, which offers technology to optimize spending across multiple cloud platforms.
The inclusion of Kochava, a mobile marketing measurement and attribution company headquartered in Sandpoint, Idaho, underscores efforts by Spokane’s leaders to connect and leverage the strength of the broader region.
The growth of the tech industry can be seen in a 13% increase in information technology jobs in Spokane County between 2018 and 2013 — nearly twice the rate of overall employment growth during the same timeframe, according to data from the Spokane Workforce Council.
Even with that growth, IT jobs remain a small part of the overall workforce, less than 3% of employment. This is one of the challenges and opportunities identified by business and technology leaders in the region — getting the local tech economy to critical mass so that workers have multiple fallbacks if they lose or leave their jobs.
A flagpole in the former Itron campus in Spokane Valley. (GeekWire Photo / Todd Bishop)
About 12 miles east of downtown, at a large industrial and office complex in Spokane Valley, we discovered a trail through the past successes, ongoing challenges, and potential future of the region’s tech industry.
In the far corner of that cavernous space, serial entrepreneur Jordan Allen was unpacking his new startup’s potential, one item at a time, from boxes of returned products stacked higher than his head. The fledgling company, BuyWander, is building an online auction site for the resale of returned goods.
“This is such a big problem,” he said, describing the environmental and economic impact of product returns. “Almost a trillion dollars a year in returns. We’re talking to the largest national retailers. We just want the problem to go away.”
Allen has been here before, literally and figuratively. This is the fourth startup he has built in the Spokane area, with two prior exits and one “cataclysmic” event as the CEO of Stay Alfred, which he describes as the first love of his entrepreneurial life before it was done in by the implosion of travel at the onset of the pandemic.
Jordan Allen inside the warehouse for BuyWander, his latest startup. (GeekWire Photo / Todd Bishop)
He grew up in the Spokane area, but he and his wife were initially living in Seattle when Stay Alfred started, before deciding to move to Spokane due to the lifestyle; the proximity to mountains, lakes, and outdoor recreation; the family friendly community; and the relative affordability for growing a business and raising a family.
Allen cited challenges for Spokane startups including access to capital beyond early funding rounds, often requiring them to look to Seattle or Silicon Valley investors for follow-on rounds. Even with the rise of video conferencing, getting the attention and interest of those investors can be tougher for startups not based in major tech hubs.
“You definitely have to work a lot harder,” Allen said.
Spokane entrepreneurs cite this issue of access to capital as both a strength and a weakness for the region, depending on the stage of the funding cycle.
Groups and firms such as the Spokane Angel Alliance, led by Simpson, and the Cowles Co.’s investment fund, Cowles Ventures, led by Skye Henderson, have made Spokane stronger than many similarly sized cities for early stage capital.
Life sciences: Selkirk Pharma and Jubilant HollisterStier, a contract pharmaceutical industry manufacturer, are often cited as examples of the Spokane region’s potential to capitalize on its potential in health and life sciences.
One key will be boosting the number of startups emerging from WSU’s Elson S. Floyd College of Medicine in Spokane.
Groundswell of support: The Spokane region has experienced a surge in startup groups, economic development initiatives, and organizations to support entrepreneurial activity and new tech startups in recent years.
A diagram of the Inland Northwest Innovation Ecosystem, created by LaunchPad Inland Northwest in partnership with Gonzaga’s New Venture Lab. (Click to enlarge.)
Organizations working to connect and advance the community include:
By its nature, Spokane’s tech community has a knack for supporting its own.
Brynn Snyder, the CEO and co-founder of Slate Flosser, the Spokane-based electric flossing device maker, recalled an incident last year in which the company’s Facebook advertising account was hacked. Through the Spokane community, she was able to connect with a person inside Facebook who helped to resolve the problem.
Brynn Snyder, Slate Flosser CEO. (Slate Flosser Photo)
“It’s so great how the community wraps around you,” she said.
Snyder said she has benefitted from an emerging support network for women in the C-suite in the Spokane area, led by Jennifer West, a communications executive, Betsy Cowles, the Cowles Co. CEO, and Linda Underwood, Banner Bank senior vice president.
In addition, she’s able to connect when needed with other women in leadership positions in the region, including Darby McLean, CEO of Spokane-based seasonings company Spiceology Inc., and Joy Tang, CEO and founder at Markable AI.
Stronger connections: Back in downtown Spokane, we found entrepreneurs and remote workers heads-down at the desks and inside the picturesque conference rooms of Fellow Coworking. The space has been deemed one of the most Instagram-worthy spots in the city, and could easily be mistaken for a trendy office in Seattle’s Pioneer Square.
Inside the Fellow Coworking space in Spokane. (GeekWire Photo / Todd Bishop)
While coworking spaces such as this provide an important service, one consistent refrain from younger entrepreneurs in Spokane, in particular, is the desire for a centralized, dedicated space for startup leaders, specifically, to work in closer proximity on a regular basis, learning from and helping each another as they build their companies.
“If there was a spot that I knew there were tech founders just working, I would love to just be there and bounce things off each other — that’d be useful,” said Matt Iversen, 29, co-founder of the AppRabbit no-code platform for building custom apps, which raised $500,000 last year from Cowles Ventures and the KickStart fund.
Matt Iversen, AppRabbit co-founder. (GeekWire Photo / Todd Bishop)
We’ve heard rumblings about a larger plan along these lines, for a shared space geared specifically to startup leaders, and we’ll see if we can break some news along the way as this series unfolds.
Githens, the Gonzaga senior from Issaquah who plans to stay in Spokane after graduation, connected with the tech community almost by happenstance. He interned at Slate Flosser after Snyder spoke at one of his classes, and learned about an Ignite event based on one of her LinkedIn posts. After that, he was plugged in.
“If the goal is to get more college students interested in staying in Spokane, [one way] would just be trying to expose them even more proactively to what’s going on,” he said.
Githens has launched his own startup, Table Topperz, which offers customizable vinyl wraps for tables and boards used for cornhole, beer pong, and other games, ending the need to hand-paint them. He plans to continue building the startup, and has been talking with Spokane-area companies about jobs after graduation, as well.
Other students from Gonzaga’s Hogan Entrepreneurial Leadership Program also recommended more purposeful connections between the Spokane startup scene and students. That was one takeaway from a report prepared for LaunchPad Inland Northwest by the university’s New Venture Lab, produced by a research team led by business student Colin Moore.
“Throughout the course of the semester, while working on our research, we were brainstorming ideas on how to get people like us to stay in Spokane,” the students wrote in their report. “We realized that there are hundreds of companies in the area that have opportunities for employment, however, due to the small size of most of them they require experience prior to employment. We believe that finding a way to implement a sort of training or way to get experience prior to this employment would allow for lots of students to get involved.”
Tom Simpson at the Ignite Loft in downtown Spokane. (GeekWire Photo / Todd Bishop)
One of the key connectors in the Spokane tech community is Simpson, a University of Washington business graduate with an MBA from the University of Pennsylvania’s Wharton School.
He’s the nephew of the late Physio-Control president and Washington Research Foundation co-founder Hunter Simpson. Looking back, Simpson said his uncle’s work had a big influence on him as he was growing up.
“I tie it back to Hunter,” Simpson said of his work in startups, investing, and the Spokane tech community. “I was the fourth son of a conservative Spokane attorney, I was a CPA, and somehow I got exposed to all this stuff.”
Simpson assembled the group of Spokane-area organizations providing underwriting support for this “GeekWire on the Road” series about Spokane, which GeekWire’s editorial team is producing independently.
In the broader community, Simpson said he hopes to see greater recognition of the potential for Spokane and the surrounding region to become a bigger tech hub, and the benefits that would bring.
“I wish this community was more united, and had in its DNA the desire to be a tech hub,” he said. “That’s the biggest challenge: getting everybody on board, everybody rowing the same way, every economic development group saying, this is top on our list, we want to become an Austin, we want to become a Boulder.”
But perhaps more than anything, Spokane still needs a “lightning strike” — a company that does for the region what Microsoft did for Seattle, and what Micron and Hewlett-Packard did for Boise.
That’s what Simpson said to the Spokane Spokesman-Review back in November 2000, long before the term “unicorn” became a popular reference to tech startups that reach a billion-dollar valuation.
As the venture capitalist told the newspaper at the time, “That kind of company puts an area on the map. It attracts talent, spawns spin-offs and generates seed capital for investment in new start-ups.”
Nearly a quarter-century later, the Spokane region is still waiting for a jolt of that magnitude. In our recent interview, when asked to reflect on what has changed, Simpson cited numerous examples of the region’s momentum, including some “mini lightning strikes,” while acknowledging that Spokane’s bigger breakthrough has yet to come.
In the ongoing quest for a lightning strike, he said, it might not be possible to control the weather — but Spokane’s startup community is doing everything it can to “put the trees in the right spot.”
Sourced from GeekWire
