The 6 Best Cities To Start A Business Right NowJeff Barrett / Inc.com
Silicon Valley, New York, Los Angeles, Chicago, Seattle, Austin and more have well-established and booming startup scenes complete with big companies and investors to impress. But all of those cities have another thing in common. They are pricey and the competition is steep.
Many founders are looking for the next up-and-coming startup scene–a chance to have similar access to investors and large companies but also stay lean.
Andrew Yang, Founder of Venture for America, has been contributing to those new cities for the last five years. His 501(c)(3) places "recent graduates at startups in cities with emerging entrepreneurial ecosystems."
But it also has an Executive in Residence program that brings executives from Slack, LinkedIn, PayPal and more to a smaller location for a year. The executive gets to build growth in another location while being by paid by their company. The company gets to create impact in a community.
What Makes a Location Attractive?
"The things that attracts young people the most is other young people," said Yang. "They would be petrified of Cleveland. But if you are moving with 10 of your friends and there are already 25 there it makes more sense. We are creating a cohort, a community. We see them visiting each other in our other cities. A friend sees someone in Cleveland with an Instagram feed thinks, 'Hey I didn't know that's what Cleveland looks like."
Seattle wasn't "Seattle" until Starbucks, Microsoft and Amazon helped it grow. Before that it was just Boeing and Nordstroms. "How a city like Pittsburgh or Detroit brands is with a hit company. Groupon helped in Chicago. You need a couple of hits. One hit even. Starbucks and Amazon are the best brander you can have," said Yang.
Why Each Of These Cities Could Be the Next Seattle
There's no replacing Silicon Valley so the expectation has to be set first that all nine of these locations have a long way to go. But with continued investment, the right hit company and continued incentives each makes a case for being the next breakout competitor in a crowded space.
Pittsburgh is often described as a city in the heart of the so-called "rust belt," but what so many don't know is that Pittsburgh is now home to Google, Uber and Amazon, some of the most progressive companies in the nation.
"Carnegie Mellon was ranked #1 by Business Insider for schools specializing in software development and have deep core competencies in computer science, robotics, and machine learning," said Brendan Carroll, CEO & Founder of Skycision, a local startup that uses aerial technology and data to aide farmers.
There is an unprecedented revitalization going on in the city driven by universities and talented workforce, making Pittsburgh one of the country's greatest innovation hubs. It's the breeding ground for autonomous vehicle technology – or what we call self-driving cars – a technology developed decades ago by CMU's leading robotics engineers. Now, Uber's Advanced Technology Center calls Pittsburgh home, and in 2016, Uber launched a pilot fleet of autonomous vehicles in the Steel City.
Downtown Indy's largest skyscraper is about to get a big name change – from Chase Bank to Salesforce and they're decking the tower out in shared working spaces, local retailers and more along with 800 new employees.
Financial tech company Smart Asset listed Indy as its 4th best city for women in tech based on gender pay game, jobs filled by women, tech growth and income after housing costs. 1 in 50 engineers in the U.S. were trained at Purdue University. Purdue has the 3rd largest international student population in the U.S. which has contributed to CBRE–the world's largest commercial real estate firm–naming Indy a 2016 Top 5 City for Tech Job Growth.
For those that live there it's a test market for AT&T's new 5G network, Forbes' best place for renters in 2017 (avg. Indy rent is $806), and CNN Money's #1 Most Affordable City.
Companies like The Finish Line (second-largest athletic retailer in the US), Simon Property Group (malls), Angie's List are from Indianapolis.
The State of Rhode Island has made major investments in entrepreneurship. In 2016 they attracted GE Digital, Johnson & Johnson, Virgin and a world renowned Cambridge Innovation Center–an accelerator for innovation enterprises.
Rhode Island has created college tuition incentives to attract new talent and used the existing talent of top nearby research institutions like Brown and Harvard to create an emerging Silicon Valley clone. USA Today ranked Brown #1 in the country for applied mathematics.
"We had to make connections to eds and meds, especially for existing companies," said Stefan Pryor, Secretary of Commerce at State of Rhode Island. "We have an Innovation Voucher Program. If a company is looking for R&D we'll pay for a college or university medical center to do that R&D research. We have made 22 of these arrangements so far and increase the funding year after year. It's helping to fuel the innovation economy."
It's a wonderful time to start a business in Columbus, OH. Home to The Ohio State University, already one of the largest universities is growing with it's largest applicant class this past year and a record setting year of fundraising.
The city is home to five Fortune 500 companies and is rapidly growing in the healthcare industry with major players like Cardinal Health, CoverMyMeds, and CrossChx..
According to a 2015 report by VentureOhio–an organization that looks to advance entrepreneurship in the state, Columbus office space is 40 percent less expensive than Chicago and 60 percent less expensive than New York City.
Columbus ranks #1 in scaling startups, as well as as #4 for entrepreneurial growth according to the Kauffman foundation. Behind OTAF (the largest angel investing group in the Unites States), Rev1 Ventures, NCT Ventures, and Drive Capital, we are attracting more and more startup companies and entrepreneurial talent.
"We committed $90M in private sector funding if Columbus won the first ever Smart City Challenge with $50M at stake from the USDOT and Vulcan Inc. (which we then did win). That's $140M to develop Columbus, Ohio, to be the benchmark for smart city and innovation in the United States. We're talking autonomous vehicles, public Wifi, a consolidated transit pass, and more," said Jay Clouse, Commissioner at Create Columbus.
Consistently ranked one of the best cities in the world, Charleston is home to 250+ tech companies and its digital economy ranks highly: 11th in the nation for high-tech industry output and the fastest-growing mid-sized metro for IT.
Charleston was also just ranked on TechNet's "Next in Tech" metro startup economy index. Plus, the Charleston metro ranked 12th in the nation for first funding rounds by deal concentration per capita in 2014.
Charleston attracts 35 new people each day (12,700 net new people each year), two-thirds of which are 18-44 years old and highly educated. Many of the tech professionals behind Charleston's top companies hail from places like New York or Atlanta and cite Charleston's unbeatable lifestyle and collaborative tech community as reasons why they chose to relocate.
6. Chiang Mai
Why is a city in Thailand called "the top destination for digital nomads." Forbesand Tech.co writers have both made interesting cases for this. Travel + Leisure named it #2 on its lists of World's Best Cities. Charleston, mentioned earlier, was ranked #1.
More than half of the battle in entrepreneurship is keeping costs down until profitability is reached. You can live in this city of 1.6 million on less than $500 a month and connect with a community of other like-minded entrepreneurs.
There are some obvious hurdles like pollution and language barriers that don't exist in the other five cities. You wouldn't move a whole team to Chiang Mai. It only fits for certain kinds of businesses. But it still makes the list for risk-takers–which happen to be all entrepreneurs.