Deciding where to stake your claim

fati@fatierdogan.com

“Today’s key economic factors - talent, innovation, and creativity - are not distributed evenly across the global economy. They concentrate in specific locations. In today’s creative economy, the real source of economic growth comes from the clustering and concentration of talented and productive people. The clustering force makes each of us more productive, which in turn makes the places we inhabit much more productive, generating great increases in output and wealth.”

So says Richard Florida, author of the international bestseller “Who's Your City?” Given the latest technological advancements, it's fashionable these days to assume we can all work from anywhere, but Florida points out that people still tend to cluster in particular areas, and that that clustering leads to a synergy of creativity and productivity greater than the sum of its parts.

Istanbul is one example of such a cluster. It is the heart of Turkey's business life, and it attracts talented people from around the region. Over the past seven years especially, more and more international companies have decided to place their regional headquarters in Istanbul. The city has several advantages, from its talented human capital to its logistical strengths. Many companies see it as an ideal jumping-off point for access to a growing market, and so they come here and create even stronger clusters of talent.

Entrepreneurs can take advantage of this clustering, too. For example, if you want to build your own "life coaching" business, big, vibrant cities like Istanbul or Ankara can be a great place to start. The stresses of traffic, the long working hours, the demands of family and kids - people hardly have any time left for themselves. In an environment like this, many look for ways to give fresh direction to their lives, and so a life coach will find concentrated groups of people who are open to what he offers. Of course, in cities like these the coach will also find more competition, but that will just push him to experiment and develop new ways to stand out from the crowd.

There are many different kinds of clusters. There are clusters of creative talent. Clusters of research and development. Clusters of vendors and clusters of customers. Often, different clusters will overlap in the same city, but not always. In those cases, you have to choose which kind of cluster you consider most important, and the spirit of your business will be affected accordingly.

Other criteria go into choosing a location, though, besides where are the biggest clusters of customers or business talent. In Turkey, the most obvious cluster for most things business is Istanbul, but many entrepreneurs feel that that kind of concentration comes at a great cost, and they choose to start their businesses elsewhere.

For example, İzmir is not known for its huge commercial potential, but it has a more relaxed lifestyle and less traffic, which leads to less stress. If you are an entrepreneur choosing a location for your new business, consider that the higher quality of life might unlock a creative spirit that would be squelched by a larger city. Plus, you may find there is less competition there, and that could work to your advantage when you are guiding your business through the especially delicate startup phase. Being surrounded by less competitive noise can also allow you to make a name for yourself, rather than just being yet another service provider in a far-too competitive city.

Entrepreneurs’ natural courage and curiosity enable them to spot opportunity in environments where others might not see it, and that includes going where the clusters are not. An international megacorporation choosing its next regional headquarters might consider Istanbul the promised land, but an entrepreneur might see Istanbul as a crazy place to start, and a small town in southeast Turkey as ideal. Be aware of the benefit of the clusters around you, but don't forget that most hidden opportunities lie where you least expect to find them.