Austin is the capital of the Lone Star State: Texas. It has a great restaurant and nightlife scene, museums and other cultural attractions, and plenty of stunning mountain scenery.
In short, it’s a very desirable place to live and work, so it is hardly surprising Austin is also one of the best cities for startups. In fact, it officially outranks Silicon Valley, the home of many leading tech companies.
Data published by a reputable real estate platform in 2019 showed that Austin, Texas had excellent business startup rates, successful crowdfunding campaigns, and an impressive growth rate for solopreneurs. All of this pushes Austin above major cities like Washington and Seattle in the leaderboard.
Why is Austin one of the best cities for startups?
There are many reasons why Texas in general is so popular for entrepreneurs. It was listed as the best state to start a business in 2019’s Best & Worst States To Start A Business report from WalletHub. The main reasons for this are:
- Texas is a huge state, so it has a correspondingly large talent pool for businesses to make use of.
- Texas is happy to embrace innovation, which is why tech startups do so well here.
- There are tax benefits to starting a business in Texas.
- Texas may be big, but it’s friendly to small businesses.
Austin benefits from all the advantages offered by Texas, namely a large number of millennials in its population and a welcoming climate for tech companies. However, it also has some unique selling points that help to attract many entrepreneurs and startup ventures.
1. Innovate Austin
One factor is Innovate Austin, a program implemented by the Austin Chamber of Commerce, which is designed to offer thought leadership and strategy. The Innovate Austin program boosts visibility for homegrown businesses, works with foreign investors to encourage them to invest money in the region, and cultivates a diverse network of partners to help businesses in the region.
There is also a Capital Committee focused on supporting development in the innovation zone, providing additional capital, and supporting recruitment.
2. Austin is Attractive to Employees
Austin is working hard to ensure business development does not come at a cost to local residents. Since startups rely on labor to grow their businesses, the City of Austin has put measures in place to protect employees from unscrupulous employers hoping to take advantage of the thriving job market. This includes a fair wage guarantee for Austinites employed by businesses given employment incentives.
In a statement to the press, Rebecca Giello from Austin’s Economic Development Department says the policy is intended to address gaps in service and the needs of the community.
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3. Austin Offers Diversity
Austin isn’t just a tech hub, although technology companies certainly find a lot to be grateful for. Technology is an important part of the local economy and business environment, but it isn’t the dominant sector. There is plenty of room for other businesses in the city, which means the city has greater resilience to economic strife, and if one sector experiences a downturn, it won’t have too much of an effect overall.
4. Coworking Spaces
There is a huge number of co-working spaces in Austin, around 720k square feet, in fact. This is perfect for bootstrapped startups hoping to get going in the city.
If you are ready to start a new business, Austin is the place to be. Whether you have an idea for a tech startup or you are hoping to crack the service sector, Austin has so much to offer right now. What are you waiting for!
5. Startup-Friendly Demographics
Perhaps the most important reason why Austin, Texas is one of the best cities for startups is its people. Why do we say this? Well, in recent years the U.S. Chamber of Commerce found that over 40% of Austin’s population is of prime working age. With such a large amount of people between the ages of 18-44, any startup in the area should have an easier time finding ready, motivated employees.
Something else that might help Austin’s reputation in the startup-verse is that its people are among some of the most educated in the United States. First of all, it’s a college town, with many of the students being residents as well. There are lots of graduates with degrees ready to put them to use. If you’re starting up a company and need to find some good talent, you might be able to have your pick!
6. Favorable Tax Structure
One thing you might like to know as a future startup entrepreneur is that Austin, TX has one of the most favorable tax structures for new businesses. In fact, it has one of the lowest tax rates in the U.S. when it comes to startups. With no state income tax, Austin is absolutely one of the best cities for startups if you’re looking to save money to invest back into your business. It’s no wonder that Austin was ranked as the best area to start a business in 2018.
The Bottom Line:
We hope that this article helped you! Clearly, Austin is one of the best cities for startups due to its super business-friendly environment. It doesn’t get better than this! If you have any other reasons that Austin is so great, leave them in the comments and we’ll include your suggestions in the next update.
Thanks for reading and best of luck!
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