Dr. Jeremy Weisz 16:23
Yeah. Thanks for walking me through that. I’m going to so I want to go through what you do next. Right. What do you do first?
But I want to just in my mind kind of summarize generally what you said there, which is there’s social proof there that you included from like, all the past success, there’s a plan based on data that you shared. You shared some of the pain points of what’s going on. You also shared, identified some solutions. Again, all this kind of is based in specific data. And then you shared what the future looks like.
You kind of paint a picture what the future looks like. And also in that identified solution, you talked about specific niches and things like that. So I like kind of how you always go back to the data. Right. Because that’s it’s all supported in what you’re saying. So what do you do first you’re like they’re like, okay, Nick, let’s do this right. Where do you start? And what are some of the big pieces you have to put in place here? Yeah.
Nicholas Lalla 17:32
Before I jump into that, let me just underline an important point that you made. Which is and I and I do stress in the book, which is the importance of a forward-looking and positive vision. I was speaking to a civic leader in another city one day, and the deck that they gave me, like the first or second slide, literally had like ten bullet points with the worst statistics about their own hometown. And this was a deck and a conversation meant to get me excited about working with that city. And I know the data points in my hometown of New Orleans.
I know them from New Orleans. I know that cities out there are struggling, that no city is perfect, that particularly midsize cities in the heartland, a goodly number of them are struggling, but it sets cities up for failure and doesn’t inspire investment or change. If you focus on the negative. And that’s honestly something that I also kind of had to learn as a leader when I built Tulsa Innovation Labs is to not try to solve problems but unlock opportunities. Right? So I think that’s an important point. Just underscoring.
Dr. Jeremy Weisz 18:58
No thanks for pointing that out because it is a fine line and a balance. Right. Because you do. People do want to highlight the pain points, right? Because what’s the point of solving a problem.
But the positive vision, if it’s overwhelming about the pain points, you’re like, hey, the crime rate’s terrible. And all these things, you’re like, well, why do I don’t want to go there right after you?
Nicholas Lalla 19:20
Right. And well, and for me, it’s like I can’t build on a crime rate statistic. That’s not like, what am I going to do with that? Right? Like, I want you to give me the ten strongest stats about your city the ten strongest, most creative, interesting, valuable assets that your city has to offer.
Let’s figure out what those things are, and then build a vision and a strategy and a vision for shared growth around all of that, right? You can’t build off of the negative, even though it’s important not to whitewash stuff like that. Right. And those data points can help steer investment. But when you’re building a shared vision for growth, you got to start with the positive.
You got to start with what a city has, not what it doesn’t have. And I firmly believe that every city has assets on which to build. So getting back to your question. It was multiple things in parallel. One was. Building an organizational architecture Lecture for Tulsa Innovation Labs. What form would this actually take? Is it a division within the foundation? Is it a 501 C3? Is it an LLC?
Is it something else? We ultimately settled on an LLC nested under the foundation, which I think was the right decision at the time. And then second was, you know, I’m a workaholic, but this cannot be the Nick show. This needs to be a team effort. So I very quickly built a team.
You’re seeing one of my second hire, Jennifer Hankins. My first hire, maybe if you scroll down, it’s a guy named Castle Jones who’s awesome. So I built a team and very early on recognized the importance of hiring the very best talent that I could get that. One of the things Tulsa was lacking was. Young, fresh, super sophisticated, ambitious and creative economic developers. And so I built a literal dream team over time, but started with those first two hires.
Dr. Jeremy Weisz 21:53
How do you find the people?
Nicholas Lalla 21:54
And it’s a combination of.
Dr. Jeremy Weisz 21:59
Hiring is difficult.
Nicholas Lalla 22:01
It’s super hard. It’s super hard. It’s extraordinarily difficult, particularly in kind of this weird little field that I’m in. Right. In a region that doesn’t have a whole lot of precedent doing the type of tech-led economic development that I wanted to do.
We hired locally, we engaged executive recruiters. We posted on LinkedIn jobs boards. You know what’s funny about my first hire, Castle Jones, is he was working at an organization. He’s from the Tulsa region, actually, but he was in New York at the same time that I was in New York working at an organization called endeavor and randomly applied for the job. And I’m looking at his resume and he’s, you know, super brilliant BA from Johns Hopkins, went to London School of Economics from Oklahoma, living in New York at an innovation organization.
And I’m like, well, shit, this guy’s great. And so he was my first hire. I got him back to Tulsa, and he ended up leading developing our energy tech initiative and spinning that out and running the startup accelerator. So can’t speak highly enough. You know more highly of the team that is really a critical component because it made everything else easier when Tulsa Innovation Labs has a brand new organization led by a total outsider like myself.
Oozes competence and credibility. Like people knew that we were going to get the work done and that we respected them, and we did it in a spirit of partnership. So, so terribly important. The third stream in building Tulsa Innovation Labs was getting to work on figuring out what is Tulsa’s tech niche, what are those opportunities for growth and what Jan and Castle and myself realized, you know, which is a realization that a lot of cities come to begrudgingly. So, you know, we needed a consultant.
We didn’t have the access to large databases, much less the time and staff capacity to analyze it as rigorously as we needed to, you know, New York City Economic Development Corporation, where I’d come from has an entire team around data and internal strategy consultants, essentially. And I’m building a baby version of that in northeast Oklahoma. So we knew that getting the strategy right, which would essentially define our investment thesis, was mission-critical to all of this. And because we’re backed by a $6 billion philanthropy. And thought that we could raise a lot of money.
We needed to get it right. And hired McKinsey to help us analyze the data. And, you know, I’ll say a few things on that. One is, I do think that it’s important to make data-driven decisions. I don’t think cities need to hire McKinsey-level consultants for something like this. I think there’s a ton of consultants out there, independent, mid-range, that do really good work in this space. But the higher quality the data, the better the decision-making. What the till team did effectively, in parallel and in partnership with our consultant, was engaged. Stakeholders conduct stakeholder interviews, contextualize the data that our consultants were finding, translating it into actionable insights. And, you know, McKinsey aren’t economic developers or urbanists.
That’s what till is about, right? So they can tell us the compound annual growth rate of whatever. My team can then say, okay, here’s what we actually do about that. Right. And how do we connect it to the community. And I think that made for a really effective, effective partnership. We interviewed over 100 stakeholders throughout that process. All of our key corporates. All of our key universities. Our philanthropies.
Our, you know, large startups. And others. And tried to build what I call a shared vision for growth over, you know, six months or so. And then in June 2020, during the pandemic, we released. Our foundational strategy, what I call Tulsa’s Techniche. It identified virtual health, energy tech, advanced air mobility and cyber as the region’s strongest opportunities for growth, all built on local assets and drawing on existing legacy industries.
Dr. Jeremy Weisz 27:09
I know, Nicholas, before we hit record, we were talking about this. So it’s like, okay, hiring people because, you know, there’s a timeline. It’s interesting. This I mean, this mimics any company really. We’re thinking, okay, you’re hiring and you’re already going in.
The mindset which makes sense is like, okay, there’s a timeline here. I need to put these amazing people in place because I have a timeline on when I’m going to be stepping away. And then the second thing, which is interesting is the niche, right. Going into what’s going to give the greatest chance for success and focus. So I’d love to talk about some of the exercises.
People can think in their own mind around this topic. And I remember I had Corey Quinn on. It’s interesting you say this. He wrote the book Anyone, Not Everyone: A Proven System For Agencies To Escape Founder-Led Sales, and he really focused on agencies and helping digital agencies find their niche. And then that allows them to really get to the next level. And so I’d love to hear what are some of the exercises people should be thinking about when they’re trying to figure out their niche, or in this case, you know, Tulsa Innovation Labs. Yeah.
Nicholas Lalla 28:21
I think it’s a few things. And one is. An important mindset shift at the very beginning, which is that cities, mid-sized cities in the heartland in particular, can’t compare themselves or compete with San Francisco and New York. There and some cities, I think, believe that they can. Other cities think that New York and San Francisco have the monopoly.
My town in Missouri or Kansas can’t possibly, can’t possibly carve out our space in tech. And I think both are fundamentally untrue. And so one of the things that we had to combat early on was a, a jadedness to civic leaders that either didn’t believe they loved their hometown, but didn’t believe that Tulsa had what it takes to become a tech hub. And or had gone down this road before where folks had tried to raise money for tech-led economic development and wasted money, didn’t get the results that they wanted. So there was some history that we had to kind of combat in, in, at the very beginning.
That’s why I think the fresh approach that I brought was so well received. Finding your technique. So the first step is basic landscape assessment of the region. Right. You’d be surprised that, you know, I talked to the 100, 200 most influential, powerful, impactful, whatever word you want to use. Leader in Tulsa and even a mid-sized city like Tulsa, people have blind spots and gaps in their own knowledge and their own experience. Half the town doesn’t know what the other half is doing. You get outside of city proper. There’s a gap between the urban and the rural. And so it’s important to be comprehensive.
It’s important to take a regional approach to economic development and to really scan the region for economic development-related assets. And, you know, and to be comprehensive about it. Right. It’s not just innovation-related assets. Big data sets, startup accelerators, infrastructure, real estate, convenings, community centers, libraries, air force bases, LGBTQ+ centers, workforce training bootcamps, venture capital firms, banks.
Right? Like you need to scan the region or assets that you think you can leverage to unlock growth, right? And maybe would it be helpful if I give you just a few examples across each of the kind of four focus areas that we landed on, maybe just as illustrative example? Yeah. So in virtual health, we identified telemedicine practices at our local universities.
This and this popped even before COVID emerged. We recognized that the rural communities surrounding Tulsa lacked access to health care, and we saw an opportunity to beef up academic innovation and support commercialization of that innovation in the virtual health space. Energy tech obviously, Tulsa is the former oil capital of the world. You have Fortune 500 and oil and gas. Energy tech is a pretty obvious example, but you have a corporate base already there.
But they weren’t working with startups, so they weren’t attracting startups to town. They weren’t innovating internally. And so we saw that as a great opportunity. Advanced air mobility. This is a really interesting one and the kind of shocker for the Tulsa Innovation Labs team. Oklahoma has a large aerospace presence, mostly in maintenance, repair and overhaul. So like fixing planes and engines, but not tech per se. But you have American Airlines. You have spirit there in the region. So you have an incumbent workforce that has familiarity with the aviation industry.
You have Oklahoma State University has a top-ranked unmanned aerial systems research center, and you have oil and gas companies and agriculture companies using drones to monitor pipelines and crops, respectively. And then another really fascinating asset that we discovered outside of city proper was a plot of land called Skyway 36, owned and operated by the Osage Nation, one of Tulsa’s local Native American tribes. And they were building a drone port on that native sovereign land to monitor to test drones and also innovation labs. His job is to identify those assets, recognize their potential and build the connective tissue around them and invest in them to generate jobs. Right.
And then in cyber turned out that the cyber hypothesis was validated. The University of Tulsa indeed has a top 25 program in cyber continuously recognized by the National Security Agency. Cyber is also a critical enabler to virtual health, energy tech, and advanced air mobility. So we saw some synergies with that niche. But it took interviews, site visits, rigorous research and analysis to identify all of those assets and then figure out how to build the vision around them.
Dr. Jeremy Weisz 34:51
Yeah, no, thanks for sharing that. I think, again, it’s instructive, I think for any company, to be honest with you, to think about these things. Right. A lot of the companies I have on, they start with one niche and then they’re kind of just experimenting, and there’s a lot of research behind it to get it to it quicker, faster, better most likely. So there’s hiring, figuring out the niche. What’s next? What do you do next?
Nicholas Lalla 35:23
Well, then I need to raise money. That’s if you see gray hairs, that’s where I got them. Yeah. That’s the hardest part. That’s the hardest part because economic development takes money. I mean, it just costs money to do. Right.
Dr. Jeremy Weisz 35:45
And you kind of, I don’t know, Nicholas. Nick, have you got a I mean, you get a soft. Yes. In the beginning. I mean, is that I don’t know what you consider like. Yeah, go, go do it and then we’ll think about it type of thing.
Nicholas Lalla 35:59
I got a little better, I got, I got a soft. Yes that our philanthropic backer would cover Tulsa Innovation Labs as opex. What exactly that meant over what period of time? Wasn’t 100% clear. But I felt confident and secure knowing that I had a philanthropic backer to give me some runway, which was super important.
I think what we did effectively was bring key stakeholders on the journey with us. So I met them the first time I went to Tulsa. I pitched many of them who sit on the board of directors at Gcaf. We included them in the strategic planning process. And the whole point of the strategic planning process is to identify barriers, in part to their growth.
Dr. Jeremy Weisz 36:58
When they have an invested interest in this. Right. I mean, because they’re in the area.
Nicholas Lalla 37:03
They need tech talent. They want to work with startups. They want to pilot emerging technologies. They recognize that. Right?
And so we included them in the very beginning, and in that process, identified specific investments that we could make together that would drive catalytic growth and impact both for them, their bottom line and for Tulsa Innovation Labs, which is interested in job creation, economic mobility. And so what we did was across the four different 4 or 5 different foci, we had a handful of initiatives slash investments in development and we fundraised. You know, I kind of work on an ad hoc project by project initiative basis based on interest from local stakeholders, the philanthropy, others. And maybe I give you. You know, just a couple examples of how we kind of cobbled together so much money in four years.
So I mentioned Energy Tech and Castle Jones, and I was just texting with them last night. So that’s why he’s like top of mind. Castle, our fortune 500 is in oil and gas, and the gap in Tulsa and energy tech is we have this corporate base. We don’t have startups. How do we get startups? For me and one of the points, the key points that I make in the book is that a lot of cities rightly see new firms as the answer to job creation, and over the long term, they’re right. But I kind of take a different approach. I don’t take a startup-first approach or a founder-post-first approach. I actually take a corporate-first approach. How do we find how we understand our corporates needs.
And then how do we find startups that fill those needs? And then what’s the mechanism that gets those startups partnering with that corporate and growing together in Tulsa? And so through a series of conversations over many, many months, we worked with a venture capital firm out of Houston called EIC Energy Innovation Capital and our fortune 500 and oil and gas. And we created EIC Rose Rock, which is a startup accelerator and venture fund and corporate innovation program focused on energy tech. And the idea is the innovation program works with our energy companies to understand their internal innovation needs, identifies startups and technological solutions to meet those needs.
A startup accelerator incentivizes startups that meet those criteria to come to Tulsa. Offer non-dilutive grants to underwrite their transition to Tulsa, and then has a venture fund that they could potentially tap to grow over time. And the way that we raise the money was we pitched this to the George Kaiser Family Foundation and secured a kind of matching grant of around $20 million, contingent upon my team raising an additional $20 million from other oil and gas companies. And if I’m being really honest, I don’t think anybody thought we could do it, you know?
Dr. Jeremy Weisz 40:43
Yeah.
Nicholas Lalla 40:45
Like, I really, honestly don’t. I think that Tulsa Innovation Labs’ success is still somewhat surprising to people in Tulsa. And it’s a pure reflection of just the hard work and dedication of the team and a community of champions that we have that really believe in the vision and the work and the community. But we did it. We got Williams, Devin and One Oak to chip in $7.5 million each.
And then a few months later, we got H and P to chip in $7.5 million as well. Right. And being able to leverage social sector funding and go out and fundraise from our corporates, our corporates stepped up. And particularly in an environment where we have a new presidential administration that will severely curtail federal funding for philanthropy, and corporations are going to have to step up into the economic development space because there won’t be federal funding like we enjoyed till during the Biden administration. Corporations and philanthropy are going to need to step up, but that’s how we did it in the energy tech space for advanced air mobility.
You know, a majority of our funding came from winning President Biden’s Build Back Better and Tech Hubs grants historic large investments from the US Department of Commerce and the Economic Development Administration, which also had philanthropic and university matching funds as well.
Dr. Jeremy Weisz 42:19
Thanks for laying that out. I love how you explained the corporate first approach, right. I mean, that’s where the money from the region is coming from. So that makes perfect sense.
Nicholas Lalla 42:27
And they have the money. They already hire people. They have a historic presence. Right. It you know, we need our corporates to grow and innovate and adapt and become more resilient.
And I think that startups and new technologies is a way to do that. I think they know that too. But you need to understand the corporate needs first. You can’t just go out and chase random startups, or as much as I think it’s necessary over the long term, invest in unproven founders locally that want to start a bakery or a restaurant, right? That’s not going to have the catalytic impact that cities need.
Dr. Jeremy Weisz 43:06
Nick, I want to go through. I still want to get to your leadership journey, but I do want to just highlight who should be checking this book out. Okay. And maybe some cities and within those cities what organizations. So like obviously I’m in Chicago right.
And what comes to mind. Seems like a perfect fit is 1871. And I think it’s called P33. Right. Those two organizations. I think of when I went to Detroit. Right. Detroit Venture Partners, I had Josh Linkner on the podcast before, who’s very involved with kind of revitalizing Detroit. I know with Magic Johnson and Josh Linkner. And then I went to one of their offices. And Gabe Karp was one of the people involved.
Nicholas Lalla 43:58
So I think in Detroit, I think Michigan. Michigan Central is doing great work with Ford and Google as well. I think about the audience in a few different ways. One obviously is urbanists like me, urban planners, economic developers, workforce developers, policy wonks, politicos. I think anybody working in tech and innovation, from engineers to business development to C-suite executives.
I think would resonate with the book. I also think civic leaders, chambers of commerce, economic development organizations, municipal officials, philanthropists, folks that care about their community, that are investing in its future, I think, need to read this book. And then I think finally, the big argument, right, is that America’s innovation economy needs to be decentralized away from New York and San Francisco. That if America is going to prosper over the next 25 years and beyond, it’s not going to be because of Silicon Valley. It’s going to be because places like Detroit and Kansas City and Tulsa and Nashville are creating innovation economies of their own.
And so, to me, any American reader that cares about the long-term future and prosperity of the country should read this book as well.
Dr. Jeremy Weisz 45:30
I don’t know where I heard this, Nick, but. Maybe someone on the podcast? I don’t know. They were calling somewhere in Iowa, Silicon Prairie. Have you heard that term before?
Nicholas Lalla 45:42
Yeah. Can I tell you why I hate that?
Dr. Jeremy Weisz 45:45
Okay. Go ahead.
Nicholas Lalla 45:48
I hate it because and I actually I have an op-ed coming out. I don’t know when. But what it does is it perpetuates the mythology that a two-part mythology, one that cities need to emulate Silicon Valley, which they don’t and they can’t possibly do so. And second, it perpetuates the myth that America’s innovation system is basically just Silicon Valley. And the entire point of my book is to make the argument that every city, particularly in the middle of the country, can find their own place in tech.
But we’re not creating silicon. Tulsa, right. Tulsa is becoming the best version of itself. They don’t want to be San Francisco. They can’t be San Francisco even if they wanted to be San Francisco.
And I’ve been told to my face by founders with cowboy hats. We don’t want to be San Francisco, right? And so to me, it’s less about Silicon Prairie or, you know, Heartland Prairie or Heartland Valley or whatever. It’s building on a city’s own assets and finding their own brand and their own identity within tech and being the best version of themselves. That’s how I one of my little Silicon Valley rant. I wish I would have started.
Dr. Jeremy Weisz 47:22
I started with that because like that just brought out the. Yeah, that was great. Nick, I have one last question. I don’t know if you have time for it because I know we’re at the top of the hour. I do want to hear a little bit about your leadership journey.
If you have to hop off, I totally get it. But I did want to hit on, you know, in the book you do talk about your leadership journey, your personal leadership journey. If you have time for it.
Nicholas Lalla 47:53
Yeah. Happy to.
Dr. Jeremy Weisz 47:57
And the more rants the better. So I appreciate that.
Nicholas Lalla 48:01
Well you don’t you don’t have to prompt me for a good rant. Look I. Five six years ago I, I was still young, still in my 30s and still in my 30s now, but was younger, a young emerging leader when I started Tulsa Innovation Labs and had built, I think, a reputation of doing really strong, high-quality work. And Tulsa forced me to make a transition from doing good work to influencing ecosystems and building a shared vision for growth, which is different than writing a kick-ass memo or a PowerPoint slide. Right?
There’s less deliverables and work products as a managing director or a founder. And I think I was slow to recognize that. And particularly as we’re building teams, I mean, we’re literally building the plane as we’re flying it. And so to me, the way that I’ve always built credibility and trust and respect is just by doing really good work. Right.
And treating people well. But there came a point, kind of two years in where I really needed to make a harder transition to more strategic, ecosystem-wide matters, delegate more, hire more staff, refine my role, re-envision How I can best deploy my strengths and mitigate my weaknesses. And what I think in writing the book, I think I came to realize and honestly, I didn’t. I didn’t really realize it. When you’re in the thick of it, doing the work on, you know, on a day-to-day basis. But this is a change management process for an entire city, right?
It’s a change management process for a $6 billion philanthropy that had never really done economic development work before. This is a change management process and experience for universities that don’t have strong commercialization engines. Right. And maybe because I was working on a fast, accelerated, impatient timeline, maybe because I was a young, immature leader. I don’t think I fully appreciated all of that.
And I think in and I think we got to a good place where really building a shared vision for growth requires bringing the community along with you. It’s not just because, and I very quickly realize this, they’re not going to the city isn’t going to just do whatever Nick wants or says, because I think I’m smart and my team is great, and I think we have a good idea. You have to really build, you know, build trust and goodwill and bring them along with you. That obviously takes longer than I would prefer, but it’s necessary for success. And I think that’s important to recognize.
I think the final point, maybe that I’d say that I also discovered in Tulsa is that. Having an outside perspective enabled me to challenge the status quo in a way that locals weren’t comfortable with. With right. I could get away with stuff because I didn’t go to school with him or her, or know their grandparents, or had lived next door for 30 years. Right.
I could be a bit of a straight shooter and tell people what I really thought. Right. And call balls and strikes when I saw them. And I think for me, one of the takeaways in the book is that you don’t necessarily need a punk like me to come from New York City to Tulsa, but you need to find leaders locally that can see cities and ecosystems from the outside in, who can have critical distance to challenge the status quo and to create a stronger, better, more prosperous path for cities, I think. And I write this in the book, and I think it’s true.
Look, and I think it’s a hard truth, right? If you’re looking to pivot to tech in 2025, then your economic development practices have not been working as well as you’d want them to. And that means you’re going to need to adjust course. And for me, the whole point of urban reinvention is embracing change, embracing the future. And I think that requires leaders who can challenge the status quo and who can paint a positive, forward-looking vision and bring people along with them.
Dr. Jeremy Weisz 53:02
Nick, I want to be the first one to thank you. Everyone, check out Reinventing the Heartland, and you could check out Nicholaslalla.com to learn more about Nick and what he’s doing. And you can also connect with him on LinkedIn. Nick, thanks so much.
Nicholas Lalla 53:20
Thanks. This was fun.
