Miami can grow its economy and create well-paid jobs by supporting larger, entrepreneurial companies operating in high-value sectors where Miami has a competitive advantage, says a report released by Endeavor Miami.

The report, based on a study of over 20,000 companies in the Miami metro area, was conducted by Endeavor Insight — the research arm of Endeavor, which helps high-impact entrepreneurs accelerate the growth of their companies — with support from the John S. and James L. Knight Foundation.

The report identified six sectors in the Miami metro area as “high value” based on their growth and local dynamism: logistics and transportation; financial services; consulting; pharmaceuticals and medical devices; software; and advertising. A significant proportion of the larger, entrepreneurial companies in these sectors have been founded in the last 10 years, the report found; many of the sectors draw strength from local assets such as PortMiami, the presence of international media companies, or the city’s close ties to Latin America.

Miami attracted $1.4 billion in venture capital investment in 2018 compared with $607 million five years ago, and it has one of the country’s top rates of new business creation. Yet Greater Miami’s economy still depends more on lower-paying service industries than many other major U.S. cities. To create more well-paid, knowledge-intensive jobs, decision-makers should support the development and success of local founders who create high-growth entrepreneurial companies in high-value industries, the report says.

“Miami has all the ingredients to grow into one of the most prosperous cities in the U.S., through the support of high-growth companies, also referred as scaleups. We are excited to be a catalyst of economic growth and development in the city,” said Endeavor Miami’s Managing Director Laura Maydón. “Endeavor Miami is committed to continue to drive this movement through mentorship and the support of our South Florida high-impact entrepreneurs, who last year generated approximately two hundred million dollars in revenue and supported over 2,000 jobs.”

Key components of an entrepreneur-led economic development approach identified by Endeavor Insight include:

• Avoid the “myths of quantity”: Though Miami is ranked among the top cities for new business creation, the companies’ scalability and high-value potential is what will ultimately lead to an increase in average incomes and boost the city’s economic growth and development.
• Focus on scale: Larger businesses that reach the scale of 50 or more employees pay higher average wages than smaller companies. This is one of the main reasons that supporting the development and growth of larger, high-value, entrepreneurial companies can have such significant impact.
• Build networks around the best local entrepreneurs: If the leaders of larger, high-value, entrepreneurial companies are well-connected to local networks, it increases the likelihood that their knowledge, financial capital, and other resources are reinvested into new founders in the city.

“These findings reveal the powerful economic potential of Miami’s growing entrepreneurial community,” said Raul Moas, Knight Foundation program director for Miami. “By prioritizing the growth of high-value local startups and their founders, Greater Miami has an opportunity to strengthen our region’s future and secure benefits that uplift our city and its residents as a whole.”