Using the Experience Town steps, here’s how an investment group looks to invest in their next generation communities:

1. Discover and extract commodities:  Utilize capital in institutional investment network, leverage student/graduate market of universities and seek currently undesirable/economically-disadvantaged sites.
2. Develop and make goods:  Team with the best urban designers to build a new urbanist neighborhood fabric, although more European/international in density/intensity.
3. Devise and deliver services:  Partner with leading main street retail managers that focus on unique local merchants, and provide $2M in local industry-focused economic development.
4. Depict and stage experiences:  Provide multiple “stages” and a $3M community center to serve as the town’s “experience agent”.
5. Determine and guide transformations:  Allow the community center to evolve as an invaluable tool by which its residents reach both their personal and business aspirations.

The economic steps to achieving an Experience Town can be compared with the progression to self-actualization in Maslow’s Hierarchy of Needs.

1. Discover and extract commodities:  The land/site, financial capital.
2. Develop and make goods:  The physical town, ie New Urbanism.
3. Devise and deliver services:  The right mix of dining/shopping/entertainment tenants coupled with community center for the residents.
4. Depict and stage experiences:  The integration of the first three into both spontaneous and planned events, from a local third place weekly game of cards to a movie in the piazza.
5. Determine and guide transformations:  Diagnosing and transforming people’s aspirations, from losing weight to reducing stress, living richer or emotionally healthier, and starting one’s own business to being part of a warm and friendly community.

One CoolTown goal is for its residents to exclaim, “Now this is a living and working experience!“

The authors of the Experience Economy listed five guidelines:  1) how well the theme or organizing principle is carried out; 2) the degree to which there is harmony of the impressions or “take-aways” of the experience; 3) the elimination of “negative cues” or distractions from the theme; 4) the memorabilia associated with the experience; and, 5) how well the experience is designed for all the senses.

Here’s a quick CoolTown rundown on that list:

1) How pervasive, sincere and effective is the walkable, affordable, sense of community, creative theme?
2) Do the store/restaurant staff/prices/menu, architecture, street layout, entertainment, art, housing and workplaces jive seamlessly with the theme?
3) Are over-priced, over-sized, non-community (ie national big boxes) establishments and parking lots kept to a minimum?
4) Can visitors buy neighborhood artist compilations of music, writings?  Is there a way to experience town events remotely via high-speed internet?
5) Are the sounds and sights consistent with the theme?  Can people interact easily?  Are the restaurants creating a buzz?

We’ve gone from an agricultural economy, to manufactured goods, to services.  What’s next?  Experiences.

The experience economy (fast becoming common language) is based on providing continuously unique experiences that can’t be commoditized by competitors, as services and goods increasingly are.  Experiences must be holistic, and examples include Southwest Airlines’ people-first mission, theatre restaurants, and Progressive Insurance’s commitment to improving the customer experience, to name but a very few.

The Rainforest Cafe is seen as “good but not quite.“  The first experience may be unique, but it’s pretty much a rehash each time thereafter.

The overall concept is nicely captured in The Experience Economy: Work Is Theatre & Every Business A Stage.  What’s next?  How about the transformational economy the authors suggest, the simplest being something like Jenny Craig.

There’s no question the entrepreneurial creatives won’t frequent shopping malls and strip centers (it was even an AOL headline last week), but there’s something they desire much more than the popular-again main street:

The piazza, pronounced like “pizza” with an extra syllable and not like a certain popular baseball player.

Why?  Because it’s designed around the concept of being a place rather than a thoroughfare, making it a much better venue for people-watching and people-meeting.  It also passes the CoolTown water test with flying colors, something even the best main streets fail at.

This is really all about the evolution of the experience economy, the focus of this week’s blog.

Today’s popular university trends described in yesterday’s blog hint at the future of university towns when those ideas are seamlessly knitted.

The common theme is higher learning in the real world:  Students no longer have to live in concentration camp dormitories, but in affordable, community-oriented lofts.  They can choose to live in themed buildings that relate to their areas of study - all the better to network, study late with and collaborate on independent projects.  They can take business courses in the town’s business district taught by successful company leaders, even establish internships - and the same goes for any other major.  People of all ages will be able to take university courses at neighborhood learning centers near their home without feeling out of place.  The best weekend nightlife in town will be within walking distance, so graduates won’t want to leave the area either.

True learning comes when it’s applied to your everyday living and your everyday working, it shouldn’t be confined to just five classrooms, a study hall and a dorm room every semester.

The university town of tomorrow looks to combine the concepts of open universities*, the Stanford/MIT model of pre-graduation job placement, location in a vibrant neighborhood with quality nightlife, and the living/learning environment, such as the University of Maryland Hinman CEO program.

What would an open university in a community look like?  See tomorrow’s entry.

*Open universities in the U.S. are essentially distance-learning schools, but overseas they are much larger and focus on a distributed satellite system of neighborhood-based learning centers that build local face-face relationships.

Other than quality of life, providing great jobs upon graduation is a key reason a city won’t lose its university-generated talent.  The question is how?

The concept of learning communities involves integrating learning with the real world, and Stanford is a model for creating a business learning community.

Stanford’s Office of University Corporate Relations offers a corporate dream guide for its students - not only is there an ongoing research partnership with the hottest Fortune 500 companies, like at the MIT Media Lab, but Stanford has its own Monster.com-like job database, on-campus corporate interview sessions, job fairs and internships to help build relationships between students and the corporations in the surrounding area.

So, graduate from Stanford and have a job lined up, plus the nightlife of hotspots like Palo Alto and San Francisco.  No wonder Silicon Valley is so desirable that no one can afford to live there anymore.

Cambridge, Massachusetts.  The presence of MIT and Harvard is really only telling half the story.  Places like Harvard Square and programs like the MIT Media Lab play a major factor in that ranking.

The bottom line is that the top engineering and biologist graduates from Harvard still want to date, party or at least meet interesting people.  That just doesn’t happen if the area around even the most prestigious school isn’t happening.

Harvard Square is a mecca for nightlife, entertainment and art.  Thus, it’s also a magnet for swarms of young people, many of whom are very attractive to the brightest minds coming out of the brightest schools who end up staying and starting the next Fortune 500s.

It doesn’t take rocket science to realize that the wealth of cities is often directly related to the wealth of talent graduating from its local universities, such as Silicon Valley and Stanford, or Cambridge/Boston and Harvard/MIT.

However, it doesn’t take much to realize it’s not a sure thing either, as students from Carnegie Mellon and Univ. of Penn. will attest there’s not much incentive to stay once they graduate.

Ask just about any student and there’s two things that will keep many of them in town:  A great job and great nightlife (ie things to do/experience, attractive women/men to meet).  What are the winners doing right and the losers doing wrong?  We’ll look into that this week.