13/07/2015 13:50 BST | Updated 13/07/2016 06:59 BST

Tall Poppies: The Rise of Second Cities

I've been travelling a lot recently mostly to capitals but I've also been lucky enough to be introduced to what I'm calling Second Cities. While not technically the second largest cities in their areas, Grand Rapids (West Michigan, USA), Waterloo (Ontario, Canada) and Hamilton (New Zealand) have exposed the excitement and challenges experienced by cities that don't get as much public funding, traffic or talent as their nearby capitals. Surprisingly, this doesn't stop them from creating the type of tech-friendly environments that governments should look to for inspiration when they invest in "smart cities" programs. So what do you need to be a Second City?

A recently dead cash cow

Many Second Cities have had a cash cow at some point: a large corporation or industry that used to hire almost everyone. Grand Rapids had the furniture business 100 years ago and until recently Detroit's automotive industry employed many of its engineers. Waterloo was home to Blackberry who once employed over 20K employees but now only has 7K. These city assets have suffered from "financial crisis hiccups" and suddenly a lot of well-educated and digitally connected people were unemployed or looking to do something else. Many move to the nearby capitals, or where they came from. Others decide to stay and build something.

Local entrepreneurs (old and new)

As the housing prices in all major capitals goes bonkers, the idea of moving away from these Second Cities seems less attractive. If you've got a family, a nice house with a garden but have just lost your job chances are you're going to try to make it locally and work with others. In Grand Rapids, a growing ecology of software companies meets every year to network and share knowledge under the umbrella of SoftwareGR. Local success stories are getting involved in tech too. Steelcase, Herman Miller and the DeVos family are all local businesses who went global and they are very supportive of their local communities, sponsoring many events and donating to cultural events and museums and starting local investment funds in the internet of things.

In Waterloo it's Communitech who organise yearly conferences with an international focus and are part of a great incubation space. They've attracted large corporations (both Google and Microsoft's venture arms have a presence) into getting desk space there to support startups whose founders used to work at Blackberry or come from nearby universities.

Downtown hipsters

In Hamilton, a farming town turned university hub in New Zealand, the downtown poverty is extreme and in your face. The appearance of malls away from the city centre hasn't helped of course but you could blame internet-enabled delivery services and car cultures too. A growing amount of poverty accompanies Second Cities and poor public transport means people are kept away from both the streets and its problems. This is an important challenge to the growth of Second Cities and hipsters are slowly moving in to help. Try finding an independent café or vegetarian place and its bound to be downtown, surrounded by not very much else and possibly even opened on a Sunday when nothing else is. In Hamilton it's Crate who also sell streetwear and Ward Street. In Grand Rapids it's MadCap. This isn't to say coffee solves urban problems but a growing hipster-friendly audience (ie many tech people) means more foot traffic to areas that need it and hopefully more independent shops opening next to each other, employing local people in need of jobs.

Keeping young people around

A real challenge Second Cities have that isn't so easy to solve with tech is one of creating an image that will appeal to young people lured by the capital. Youth unemployment and brain drain are major problems when you want to keep a rich ecology in a city. Cities need young people, families and old people in equal measures. This may prove to be difficult but the housing market may help with this. A young person may have a choice of finding a job with a local startup and get an apartment or share one with five other people for an unpaid internship (London, I'm looking at you). But that doesn't mean that local jobs should be taken for granted. In Wellington, New Zealand, most digital design graduates simply assume they'll find jobs at local special effects powerhouse Weta but that business is so popular it can afford to recruit from all over the world for very little pay. If anything young people should be taught to start their own thing and grow alongside local businesses. Second Cities can make sure local industry and academia mix as they're often not far apart.

How do Second City officials create these conditions for a thriving tech ecology? Perhaps not with top down smart city funding but really by co-creating with their citizens.

When you live in a capital it's easy to complain about the big things that are broken, but since visiting all these Second Cities, I'm excited for them in a way I'm not about London. Second Cities will have to figure out how to best harness what they have and keep people loving what's great about them. They have growing pains whereas capitals have gone past growing and are ageing. Difficult to deal with, afford and enjoy, there's a chance Second Cities will be the better future.

(Disclaimer: I'm involved in helping Nominet with the Smart Oxford Challenge)