When you hear the term “startup,” chance are you think of one of a few different settings: colorful tech offices in California, chic converted apartments in Brooklyn, and the like. These associations make perfect sense, as there are certainly a few hubs of startup innovation that attract most of the activity and attention across the U.S. When it comes time to consider your own startup though, there is also something to be said for exploring another market.
One reason for this is that entering an oversaturated market means greater competition. As a past look at risks startups fail to consider pointed out, entering a market like this simply makes it difficult to break through as you might in a different place. On the other hand, another reason to avoid the busiest startup hubs is that there’s something to be said for catching a fresh wave. Starting your business in a particularly competitive location may cause it to blend in and ultimately die out before making a mark; doing so in a place where the startup culture is still up-and-coming gives you a chance to thrive on consumer excitement and available funding (as well as less competition).
So, given these points, what locations in the U.S. might serve as strategic places for your startup? It depends somewhat on the industry you’re entering and the type of company you may have in mind. However, three states do look to be particularly attractive to new companies
1.) Utah
Utah has actually put itself on the map in conversations like these in recent years, thanks to the surge in startup activity that’s already beginning. In places like Provo and Salt Lake City, for instance, tech companies, in particular, are finding footholds and attracting a budding workforce. They may not be Silicon Valley just yet, but these cities are setting the tone for what could be a fresh decade of innovation and new business in the stat
Another perk in Utah is that it happens to be a beautiful and comfortable state to live in. An interesting aspect of startup culture that isn’t often discussed is that because it can sprout up anywhere, founders will sometimes simply gravitate toward pretty places or up-and-coming towns. Utah, with moderately sized cities, seasonal ski hubs, and plenty of pretty scenery, is a natural fit. It’s a place where people can confidently venture into a budding business market and fall in love with their new home all at once
2.) Wyoming
Wyoming has some of the same attributes that Utah does, in that it’s a gorgeous state that appeals to many startup founders’ desire to launch businesses in interesting and pleasant places. Accordingly, there has been an influx of Mountain West startups in recent years, with tech companies once again taking the lead. The state of Wyoming hasn’t gotten quite as much attention as, say, Salt Lake City in this regard, but it’s beginning to emerge as another potential hub of innovation
Adding to Wyoming’s appeal is the fact that it’s a state that makes things easy on new business founders. In the most literal sense, Wyoming’s requirements for starting an LLC comprise an easy, straightforward process that even first-time founders will find largely self-explanatory. Coming up with an official name for the company and filling out some online paperwork basically makes a new business official. On top of general ease, meanwhile, startup founders are also finding Wyoming to be appealing from a financial standpoint. It’s one of a handful of states without an income tax, and even its sales tax is a mere 4%. It also has no corporate tax, which can further favor some businesses and enhance the state’s appeal.
3.) North Carolina
North Carolina stands out primarily because it’s a state that’s absolutely overflowing with young and educated people. Among states attracting more young people of late, North Carolina ranks in the top 10 with a 2.21% growth rate. Throw in the fact that it’s also a state well known for numerous high-quality universities, and it’s no wonder that there’s quite a lot of young startup energy today.
Another interesting point about North Carolina is that here it’s not just the tech industry that’s dominating. While there are some emerging tech hubs, such as the capital city of Raleigh, the state is arguably better known for healthcare business, finance (in the city of Charlotte), and even vibrant food and drink enterprises in various urban areas. In our
words, it’s a state full of young people seeking opportunity, and one in which businesses of all kinds are beginning to find significant success. In the end, you’ll find that a well-built company that meets a consumer need can succeed and thrive almost anywhere. Every startup hub begins with a few new companies, and yours could be one of those foundational companies in an entirely new market. But for those interested in regions emerging as startup magnets, these three states are worth a look.