Real estate, the cost of conducting business, and skill level of workforce play a role in the decision making process of choosing a business location. For startups, location is crucial. Denver offers a robust economic environment that is open to new businesses and offers development tools that can be leveraged for success. As tech companies begin to face increasing issues with housing, transportation and business costs, cities like Denver have become more appealing.
Silicon Valley has enjoyed being America’s Top Tech Hub for many years. While still attractive for investors, Silicon Valley has faced significant competition and a real estate boom that has resulted in obstacles for tech companies, especially those who are starting from scratch. Coldwell Banker named Los Altos, California the most expensive real estate market in the US in 2014. Average home prices there were nearly $2 million and rental prices are the highest in the country.
In 2015, Kauffman Foundation named Denver one of top US metropolitan areas for business start-up activity. The Forbes’ Best Places for Business and Careers ranks Denver #5 in its list of great places for business. Colorado is also ranked #9 on CNBC’s list of best states for business while USA Today ranked Boulder/Denver as a top city for tech startups.
This is not surprising since Denver has a long and successful entrepreneurship history. From its long established employers including Oracle and Lockheed Martin, Denver is also home to several local tech startups such as Boom, Havenly, nPloyed and so on. Recently, Comcast has also established an innovation hub called Comcast Labs, a development center to build next-generation television products. The region offers significant opportunities and that is why many big tech companies including Arrow Electronics, DaVita, Hitachi, Lockheed Martin and Vestas Wind Systems have expanded operations or have relocated to Colorado. The U.S. Patent and Trademark Office is also now located in Colorado. These companies have decided to invest in Colorado because they believe that their business can thrive there.
In 2015, Denver startups were able to secure $822 million in venture capital funding. While most industries including real estate, mutual funds and other entities received significant funding, the majority of capital was secured by Denver’s tech startups. According to Erik Mitisek, CEO of the Colorado Technology Association, Colorado will become the uncontested tech hot spot between San Francisco and New York City.
Two major factors make up Denver’s attraction for startups: programs with attractive incentives for entrepreneurs and the city’s highly skilled workforce. For example, Commons on Champa in Denver is a public workspace that offers programming and event spaces to new entrepreneurs. In addition, the local workforce is highly educated and skilled making it easier for tech firms to gain access to significant talent. A report from the Census Bureau reveals that a large number of people are moving to this region. Between 2014 and 2015, Denver was the fastest growing large city in the US. The city had a population growth rate of 3 percent which surpassed Las Vegas, Austin and Seattle. Denver is also among the twenty most populous cities in the US.
The housing market is very affordable and the city’s infrastructure is stable for new businesses. In addition, Colorado is much ahead of other states in several areas including green technology, telecommunications, energy, bioscience, high-tech, healthcare, health food and organics. The primary factors responsible for this position include a high average wage across the industry; steady employment levels and a booming housing market. Best of all, Denver offers a complete package in the form of great schools, beauty and lifestyle options that are suitable for both small town and big city people.
Denver has been showing significant growth and an economic shift from real estate to technology. This shift has resulted in more and more entrepreneurs focusing on Denver – opening offices and hiring tech workers. Denver has a high concentration of excellent universities not only in the main city of Denver but in nearby cities like Boulder and Fort Collins. With the availability of an educated workforce and a low cost of living, Denver is an attractive option for both big and small tech companies. The presence of big companies has created a vibrant start-up scene for Denver thus attracting other entrepreneurs to the region. With prices of everything skyrocketing in other regions, investors believe it is a more promising region to invest in.
One noticeable characteristic about Denver, is it has always been an early adopter – whether it’s legalising medical and retail marijuana or the use of crowd funding. Denver appears to function with a progressive mindset and this combined with strategic business policies, talented and young workers, access to world class outdoor activities, sunshine most days of the year, good education system, a thriving job market and affordable housing, Denver possesses all the ingredients that should be present in a successful entrepreneurial environment.
The city offers an extremely supportive environment for new business. The Colorado Technology Association and local incubators like Galvanise are continuously engaged in fostering a cohesive environment and in helping startups excel. Denver’s Golden Triangle district is an up and coming neighbourhood that has attracted numerous startups recently. Moreover, Denver has less of a “job hopping culture” as compared to Silicon Valley. People tend to be more focused, committed and loyal to their employers.
The city government of Denver has played an important role in establishing the city as a start-up haven. Investment has been made in improving the city’s infrastructure to attract both investors and a skilled and educated workforce. In addition, the government has tried to make it easy for startups to get going by reducing unnecessary regulatory barriers, streamlining business set-up procedures and implementing consistent tax policies. The goal of the city’s Office of Economic Development is to create an environment that would attract unique startups and that would enable them to take advantage of Denver’s assets and resources. The ultimate goal is to accelerate economic growth, focus on innovation and enable businesses to thrive.
Denver is not only attractive for business opportunities but also for the distinct lifestyle that comes with it. For the foody and beer connoisseur, the city is home to great food startups and dozens of craft breweries. For people who love skiing and snowboarding, the Rocky Mountains are right there. For those into mountain biking and hiking, Denver is the place to be. The beauty of outdoor activities is a huge asset for Denver and one of the primary reasons why people consider the quality of life there to be very high.
Overall, the high quality of life, supportive network and strong company cultures make Denver the ideal for tech startups. If the city government continues to support new business ventures and if the basic mindset for Denver continues to remain progressive, there is no doubt that the city and its businesses will continue to thrive and will be able to generate growth for all stakeholders. This combined with a distinct culture and the great outdoors, Denver seems to be one of the most popular cities to run a business as well as live a comfortable and healthy life.