Smart City initiatives are considered a vehicle for achieving sustainable development of urban growth. This paper explores the conditions and factors that affect innovation in Smart Cities from an entrepreneurial vantage point. Data was obtained through a series of interviews with German entrepreneurs active in Smart Cities. Beyond examining the importance of a set of factors that originate from the extant literature, our findings suggest that entrepreneurs believe that Smart City initiatives need a clear vision to drive their development and growth and that government has a key role to play in bringing the necessary resources and stakeholders together.