Opinion: Silicon Valley is looking at Charlotte, but can’t find a leader

By Sam Smith of Start Charlotte

A group of 10 Charlotte-based founders and investors, an Ohio congressman and four investors from Silicon Valley and New York sat around a large table at Napa on Providence late October 16. A party you might only experience in San Francisco was brought to our backyard through a tweet.

Before Roy Bahat, head of Bloomberg Beta, headed out on a three-city tour of the South, he asked his Twitter followers for advice on whom he should meet to get an authentic view of startup life in the Queen City. I’ve met some of the best founders in Charlotte through Collective Hustle, making it easy to offer introductions.

The trip was part of the “Comeback Cities Tour,” an investor pilgrimage of sorts conceived to show Silicon Valley investors the kinds of companies born and raised in parts outside the country’s major startup hubs. Earlier this year, the tour headed to several cities throughout the Midwest. Last week, that same group of investors hit up Charlotte, Columbia, S.C., and Atlanta.

A few emails and two weeks after that tweet went out, I was sitting next to Bahat as he explained his group’s goal to better understand our ecosystem, as well as learn how Silicon Valley investors can better connect with founders and investors in the South.

The following day an additional 11 investors gathered with Charlotte politicians, local educators and a handful of Charlotte founders to continue the conversation.

Even though the two different groups had separate conversations, the commentary revolved around three central questions: How can new startups gain access to capital? How can the local government better assist? And which local investor will lead the way? And the end result was a common realization: Startups are struggling to find support in the Charlotte ecosystem.

Access to capital in Charlotte

Almost every founder that spoke voiced frustration over their experience with risk-averse investors in the Queen City, leading to difficulty getting new ventures off the ground.

“Other [venture capitalists] don’t understand the hurdles we face,” said Patrick Hill, founder of a Cultivated Mindset, a mobile app and web development firm in Charlotte. “In Silicon Valley, they accept six out of 10 checked boxes as far as ‘what they need’ from a startup. Maybe you don’t have the employees or traction; those investors will help you check those last four boxes. In Charlotte, you have to have all 10 boxes checked without any help from outside capital.”

Some investors argued that a lack of resources forces the founder to focus on making money, creating a powerful exercise to generate revenue more quickly. But a lack of capital and shift to conservative business practices can lead startup leaders to take fewer risks in the long run.

“I see a loop where founders with conservative investors will begin to make more conservative business decisions,” said Charles Hudson, managing partner and founder of Precursor Ventures. “When I speak to companies that don’t have a big vision and stop taking risks, I don’t get excited about investing in their startups.”

Obstacles faced by founders in the Queen City aren’t unique, but a few investors noted their surprise over the lack of angel investment activity in such a thriving metropolis.

“There is a reason there isn’t risk aversion in San Francisco. It’s because the founders and the investors in the area started out as misfits,” said Representative Ro Khanna, a Democrat who represents the Silicon Valley region. “They didn’t have the right look. They didn’t quite fit in. That fueled them and gave them a willingness to take risks.”

Bahat interjected, “But before the misfits, the government stepped up to help.”

The role of government

Congressman Tim Ryan, a Democrat that represents northeastern Ohio, may seem like an odd addition to the group, but he and Bahat organized the group’s inaugural trip in the Midwest last spring.

Ryan brought to the meeting the perspective of a local government official who is doing big things for the entrepreneurial ecosystem. A few hours before landing in Charlotte, Ryan announced that original tour led to the creation of the $2.25 million Comeback Capital Fund, created to bridge the divide between Silicon Valley investors and Midwestern startups. Investors in the fund included HighRidge Venture Partners, Bloomberg Beta, Gener8tor and 30 individual investors.

In Charlotte, Ryan focused in on how local officials could do something similar in the Queen City.

“With banking jobs becoming more automated, how can the local government prepare Charlotte for the disruptive companies that will continue to bring jobs to the region?” Ryan asked the group.

Tariq Bokhari, a representative on the Charlotte City Council and a spokesman for the Carolina Fintech Hub, was vocal in speaking for the cities fintech focus and the investment opportunity in Charlotte.

“One-third of banking jobs will be extinct over the next decade,” Bokhari said. ”No one wants to think about it, but it’s coming. If we just sit around, there will be a point of no return.”

At our dinner the night before, we couldn’t think of a prominent government official that actively advocates for Charlotte startups, or who creates incentives or opportunities to keep us excited about the region. The frustration also circled around the fact that capital is available but isn’t being deployed.

We discussed actionable items government officials could take to invigorate the ecosystem, including courting startups from San Francisco, New York and Boston to open second offices in Charlotte, deploying existing capital to assist early-stage organizations and providing tax incentives for research and development.

Who will lead the way?

The group of founders, investors and city officials sat in Johnson C. Smith University’s new science building in a circle on Oct. 17, sharing a profile of the typical Charlotte investor.

“I think there is something Charlotte is obviously missing, which is an active angel network,” said Patrick McKenna, founder of the Silicon Valley-based HighRidge Venture Partners. “There are three types of angels: A collective group of angels that pool money together, which tend to be the least valuable for the ecosystem; An institutional angel, who is a person focused on funding with an analytical eye; And a super angel, who is usually a sophisticated investor with some skin in the game. The super angel is the most important of the three.”

While discussing his fundraising experience, Hill mentioned working with Atlanta angel investor and entrepreneur Paul Judge.

“Who is the Paul Judge here? Who is the angel that can educate the wealthy people of Charlotte to become the next investors in the ecosystem?” said Tyson Clark, general partner at GV (previously known as Google Ventures).

Courting and educating more wealthy and diverse locals to invest in Charlotte is an achievable short-term action item. A big difference between Charlotte and the regions represented by the visiting congressmen: Our investors are more likely to invest elsewhere.

“Investors in Southern cities are not only the least likely to invest inside their own metro areas, they are also the least likely to invest in startups based in the same state,” according to Jason Rowley at Crunchbase.

When there is a lack of resources in a region, founders will agree to unattractive terms that weigh heavily in the investors’ favor and make it challenging for outside investors to jump in. The visiting investors mentioned multiple times that this is a big reason they have walked away from a deal outside of Silicon Valley.

What happens next

The final statement of the meeting was made by Bokhari, who challenged the visiting investors to get more involved in the Charlotte ecosystem.

I would instead challenge local founders, investors and politicians to consider the ideas discussed among the group. We need a leader to inspire and educate new players to become angel investors. We need to find a “startup czar” who will be a liaison between the government and entrepreneurs, advocating for incentives that assist new businesses and large corporations.

As the founder of Vishion and the local entrepreneurship group Collective Hustle, I am continuing an effort to build the bridge between Charlotte and Silicon Valley. Bahat extended an invitation to bring a group of founders to San Francisco to continue the conversation, which I intend to make happen.

If you are a founder, investor or government official looking to become more active in the startup community, come to the next Collective Hustle event on November 7.

And for those who are wondering how I was able to get a seat at the table, I’ll tell you the recipe: a truckload of effort, a smidge of luck and a pinch of Twitter.

The views and opinions expressed in this article are those of the authors and do not necessarily reflect those of StartCharlotte.

Sam Smith is the founder and CEO of Vishion, a mobile application that allows shoppers to search by color for décor. She created Collective Hustle with two other female founders, Mary Johnson and Aru Anavekar. The group brings investors and founders together to improve the Charlotte ecosystem.

For more stories like this, subscribe to StartCharlotte’s free weekly startup newsletter.

Startups, Accelerators, Investment Funds...oh my!

We are beyond excited to announce the launch of Velocity Labs. Aimed at supercharging startups in our region, this program will help young companies grow faster by building connections with investors, other founders, and mentors that have had seen success in their own right.

But hold up...startup companies? Investors? Founders? This all sounds like something that belongs in downtown Durham with the techies and hipsters - not in Boone. Economically speaking this region has been driven by tourism - and let’s be real - it is not perceived as a hotbed of innovation. However, it is an area where starting a business is not unusual, it’s even a right of passage. But to scale and grow a company beyond the craggy granite boulders of Blowing Rock, or the more gentle slopes west of Boone, is not common.

If you look a little closer, there’s currently a new wave of (startup) companies being birthed here and they’re driven by creative, industrious and technically skilled locals that are fueled by laptops, smartphones, gigabit internet and copious amounts of caffeine. Having access to all of these ingredients, along with a newly minted Angel Investment Fund (High Country Impact Fund) and close proximity to Appalachian State University makes Boone an exciting place to start a company.

The 5 county area surrounding Boone and it’s groundswell of ambitious entrepreneurs have the potential to make a splash in the economy of WNC and fill a much needed gap in a high-tech corridor that starts in Raleigh, extends to Winston-Salem, passes through Boone and south to Asheville.

In order to support a thriving startup ecosystem, entrepreneurs need support in the form of capital, connections and education. Over the last 4 years, Startup High Country has been a key player in the work to transform the economic trajectory of the area by forming the High Country Impact Fund as well as connecting coders, entrepreneurs, and investors via it’s Silicon Hollar events. The next phase of growth for the ecosystem is the birth of a locally based Startup Accelerator.

What the heck is an Accelerator?

In our case, it’s a 3-month intensive program that places local startup companies into a peer-based cohort. It’s designed to force founders to critically think about their customers, iterate on products faster, test and learn, make deeper peer connections and really get a grasp of the foundational aspects of operating a high growth company.

Another critical element of an accelerator program is to help facilitate opportunities quickly through a mentor driven support network. Experienced mentors help the founders avoid the typical pathways to mistakes and poor decisions that fledgling business owners often take. They can also pave the way for valuable introductions to key hires, investors, or new business opportunities.

Key data point - startups that go through an accelerator program, significantly increase their chances of surviving the first few critical years. One accelerator program, GAN Accelerator, shows that 85% of the 9,400 startups that went through their program, are still operating today.

Being a founder of a company can be a lonely journey on a very lonely road. The camaraderie built in an accelerator program can’t be replicated in traditional incubators, co-working spaces or business classes. When a founder interacts and builds friendships with other founders that are on a similar journey, magic can happen and the chances of surviving and thriving, go way up.

So Boone has an Accelerator now - What’s next?

First off, let me explain what Startup High country has created. Velocity Labs, the High Country’s first accelerator program, launched its pioneer cohort on Tuesday, September 11, 2018 and it will finish up in late November 2018.

“Startups face a number of challenges while building a viable business,” says Jeffrey Scott, Velocity Labs Director. “At Velocity Labs we help founders understand that they are really a temporary organization in search of repeatable, scalable and profitable business models. What is the big problem they trying to solve and for whom? Is the opportunity worth the investment of millions of dollars and years of work? We help them put first things first and validate their business model early on to increase their likelihood of success as a high growth company in the High Country.”

We received and reviewed about 20 applications from various companies in the area and ultimately narrowed the group down to seven. We felt these seven local companies had the right mix of growth potential (over $5MM revenue in 5 years), product, and desire to stretch their thinking about their companies:

Hatchet Coffee, The Insulators, Silver Barre, Thriftsy, ChurchLearn, High Country Food Hub, and Smart Gaming Systems

(summary of each company at the bottom of this post)

A key piece of the puzzle has always been about teaming the companies up with mentors who have their own battle scars as well as invaluable stories of success, and failure, in their own journeys.

Our mentors are experienced, proven and knowledgeable business leaders that have been sought out by the Startup High Country partners for their expertise. These folks have lived through the highs and lows, and have personally experienced the anxiety, exhilaration and stress of starting a company, or have worked in large enterprises and high-growth startups. Our mentors are also well connected, so their personal networks are extremely valuable to the program and participants.

How long will this program be available?

For the next 3 years. Recently, Startup High Country was the recipient of a $100,000 grant from the NC IDEA FOUNDATION. Given through the NC IDEA ECOSYSTEM grant program, this investment is huge for our entrepreneurial ecosystem and is a signal of the potential and momentum building in the Boone and Blowing Rock area.

“Our partnership with Startup High Country allows us to create greater opportunity for the statewide exchange of ideas, experiences and connections between the mountains and the coast of North Carolina,” said Thom Ruhe, President and CEO of NC IDEA. "We look forward to our collaboration.”

SHC will use the grant to further Velocity Labs and promote our mission to create more high-tech (high-paying) jobs and more growth investment opportunities for the residents of the high country. With the support NC IDEA and local partners like Watauga Economic Development Commission and ECRS, Startup High Country has the fuel it needs to make a tangible impact in the economic outlook of the our region.

Want to learn more about Velocity Labs and Startup High Country? Visit us at:

www.startuphc.com


Or, connect with us on Facebook and Instagram.


Companies in Velocity Labs Cohort 1:

ChurchLEARN, a software company that helps churches recruit, equip and develop volunteers.

Hatchet Coffee, a roasting lab, slow bar, and coffee lounge.

High Country Food Hub, an online market for local food and artisan goods. It features over 500 products from 50+ small-family farms and food entrepreneurs from Watauga and 9 other surrounding counties.

Smart Game Systems, provides scenario-based learning development and a digital coaching platform for people and organizations needing greater risk agility, change of behavior, cultural alignment, improved performance, and innovation in an ever-changing environment.

SilverBarre, a fitness training technique that focuses on the training and support of the aging body. Age Graceful. Stay Active.  

The Insulators, use artificial intelligence to build models and generate accurate quotes for insulation and building world.

Thriftsy, the new way to save on your favorite brands while having fun in augmented reality!

Velocity Labs would not be possible without our amazing partners: Watauga EDC, NCIF, High Country Impact Fund, and ECRS.

October Startup Social Recap

On Thursday, October 18th, 60+ student entrepreneurs, local business owners, aspiring startups, and community members gathered at the HOW Space for the monthly Silicon Hollar Startup Social. This collaborative networking event brought together three local organizations and their followers; Startup High Country, High Country Local First, and Appalachian State University’s Association of Student Entrepreneurs (ASE).

The ASE provided snacks from Carolina Pizza Co. and Appalachia Cookie Co. for all to enjoy. Tim Herdklotz from Booneshine Brewing Co. was in attendance serving local beers along with Jeremy Bollman & team members from Hatchet Coffee serving cold brew and hot coffee!

Several Student Entrepreneurs presented their startup businesses to the crowd. Erich Schlenker, from Appstate’s Transportation Insight Center for Entrepreneurship announced the upcoming 15th Annual Carol Moore McLeod Entrepreneur Summit. This event is happening Friday, November 2 on the campus of Appalachian State University. No matter where you are on your entrepreneurial journey, this Summit has something for you. LEARN MORE AND REGISTER.

Other pitches were made by members of the Silicon Hollar/Startup High Country Team including Madelyn Hjertmann, Chris Grasinger and Sam Glover. The team announced and unveiled new branding, logo and t-shirt designs for the organization. They also announced that Startup High Country recently received a $100,000 grant from NC IDEA. With this grant funding Startup HC will be able to host the Velocity Labs 12-week Accelerator Course for the next 3 years!

John Austin from NC IDEA was in attendance and pitched to the crowd about the recent grant and other great entrepreneurship opportunities through his organization.

Angela Heavner from 180 Float Spa pitched her startup company to the room and announced her Local Public Offering. 180 Float Spa is offering you the opportunity to invest in your wellness and our community through a Local Public Offering (LPO). Local Public Offerings became effective in 2017 under the North Carolina PACES Act to help provide access to capital for new and early stage businesses. 180 Float Spa is only the second LPO to be approved for Investment crowdfunding in NC. Investment crowdfunding has been growing significantly around the nation, with over 100 million dollars raised. Now it's our turn North Carolina! Learn more and invest here!

Everyone enjoyed this collaborative event at the HOW Space and many solid connections were made! Special thanks to all those who attended and helped plan this event!

Stay tuned for information about our next Startup Social happening in November!

Click below to view photos from October’s Startup Social!

Velocity Labs Kickoff Celebration Recap

Velocity Labs, a Startup High Country led accelerator for high growth companies launched its first session of the 12-week course on September 11, 2018. The inaugural Cohort consists of 7 local startup companies in search of a repeatable, scalable and profitable business model.

The participants include:

ChurchLEARN, a software company that helps churches recruit, equip and develop volunteers.

Hatchet Coffee, a roasting lab, slow bar, and coffee lounge.

High Country Food Hub, an online market for local food and artisan goods. It features over 500 products from 50+ small-family farms and food entrepreneurs from Watauga and 9 other surrounding counties.

SGS, provides scenario-based learning development and a digital coaching platform for people and organizations needing greater risk agility, change of behavior, cultural alignment, improved performance, and innovation in an ever-changing environment.

SilverBarre, a fitness training technique that focuses on the training and support of the aging body. Age Graceful. Stay Active.  

The Insulators, use artificial intelligence to build models and generate accurate quotes for insulation and building world.

Thriftsy, the new way to save on your favorite brands while having fun in augmented reality!

Velocity Labs would not be possible without our amazing partners: NCIDEA, Watauga EDC, NCIF, High Country Impact Fund, and ECRS.

On Thursday, September 27th, the companies in Cohort 1 and community leaders gathered for a Velocity Labs Kickoff Celebration at the Hatchet Coffee Roasting Facility. Jeffrey Scott, founder and director of Velocity Labs  outlined the importance bucking the old way of getting a business started (huge business plan and traditional financing) and focusing heavily on problem/solution fit and customer discovery.

"Startups face a number of challenges while building a viable business. At Velocity Labs we help founders understand that they are really a temporary organization in search of repeatable, scalable and profitable business model. What is the big problem they are trying to solve and for whom? Is the opportunity worth the investment of millions of dollars and years of work? These are tough questions founders must answer first before the business plan is written, money raised and the business grown. We help them put first things first and validate their business model early on to increase their likelihood of success as a high growth company in the High Country." -Jeffrey Scott

Founders/CEO’s then gave 3 minute pitches to the room. Many great connections were made between the startups, local investors and potential mentors.

With 7 weeks remaining in the course, the companies will push to test their business models, interview and learn from their customers and will force to examine their processes and ask themselves tough questions in order to move forward successfully. The program will wrap up in early December with a community event to celebrate and motivate the founders to take what they’ve learned about themselves and their business and to go apply it in the real world.

Special thanks to our local brewery sponsors, Appalachian Mountain Brewery, Booneshine Brewing Co, & Blowing Rock Brewing Co. for providing beer for this event. Everyone enjoyed great pizza from Carolina Pizza Co. and delicious cookies from Appalachia Cookie Co. as well!

As always, a huge thank you to our event sponsors and host-Hatchet Coffee, and all of those that attended and contributed to the Kickoff Celebration!

The Places With the Youngest Entrepreneurs

ELYSSA KIRKHAM

Entrepreneurs may spend years gaining experience and resources as they wait for the right time to finally take the leap and start a company. As it turns out, entrepreneurial hopefuls might be able to achieve their aim of founding a business years sooner — if they live in the right place.

A new study from LendingTree reveals which 10 major cities in the U.S. have the youngest business founders. Using anonymized data from business owners seeking funding through the LendingTree small business marketplace, the study compared ages of business founders on their companies’ dates of origination in the 50 largest U.S. cities.

Average founder’s ages when starting their business ranged from 37 to 42 years old, the study found. This five-year gap in average ages might seem small, but it can represent many factors that work for — or against — entrepreneurs in each city.

Here are the 10 cities where young entrepreneurs are making their mark and forming the next wave of million- and even billion-dollar businesses.

Key findings

  • Salt Lake City, Buffalo, N.Y. and New Orleans have the youngest business founders, on average. Entrepreneurs in these cities, along with Oklahoma City, were younger than 38 years old on average at the time they started their businesses.

  • Providence, R.I., San Jose, Calif. and Hartford, Conn., fell on the other end of the spectrum — business founders were 42 years old on average when starting their companies.

  • Gen Xers helmed nearly 42% of new businesses founded in the last five years, followed by millennials who founded almost 38%.

  • Louisville, Ky. had the highest proportion of millennial founders, at 44.8%.

  • Providence, R.I. and Philadelphia had the highest proportion of Gen X founders, at 48.7%.

  • Baby boomers founded more businesses in Silicon Valley (San Jose, Calif.) than anywhere else, at 24.1%. As one of the most expensive communities in the country, it may take budding entrepreneurs longer to save up starting capital.

The 10 cities with the youngest entrepreneurs

The 10 cities with the youngest entrepreneurs are likely to have some of the lowest barriers to enter entrepreneurship.

A closer look reveals that booming local economies, along with low local costs and taxes, may be fueling startup growth. These cities also have strong support systems in place to help founders and their startups succeed, from business incubators and accelerators to networking events and opportunities to apply for small business grants or attract venture capital.

In short, these are the cities where young entrepreneurs are more quickly reaching their goal to form a business of their own.

1. Salt Lake City

The youngest business founders in the country can be found in Salt Lake City, Utah. Entrepreneurs here achieve their dreams of starting a business at just 37.8 years old.

The area known as “Silicon Slopes” encompasses the Salt Lake City metropolitan area and nearby cities; it is home to billion-dollar tech companies such as Overstock.com, PluralSight and Qualtrics.

These big players have helped established a steady, growing economy in Salt Lake City and throughout Utah. The area also has an established (and growing) pool of qualified talent. Combined with the relatively low cost of living, and entrepreneurs in Utah have few obstacles — and plenty of opportunities.

2. Buffalo, New York

In Buffalo, the typical business founder is just 37.9 years old, and a decent portion of the city’s entrepreneurs belong to Generation Z (3.6%).

Buffalo’s business climate has improved in recent years, thanks in part to a billion-dollar economic development package proposed by Gov. Andrew Cuomo in 2012. This money has since flowed into the state’s second-largest city, and Buffalo has seen some gains from the program, even in the wake of some false starts and scandals.

On top of the “Buffalo billions” initiative, this city offers a relatively affordable cost of living and a strong support system for budding entrepreneurs. This includes business education and support through the Center for Entrepreneurial Leadership at The State University of New York at Buffalo, and local business incubators like Launch NY and 43North.

3. New Orleans

The dream of entrepreneurship is within reach for many New Orleans founders — the average age of founders is just under 38.

Not only is New Orleans a cultural giant, it’s also a standout when it comes to cultivating the next generation of entrepreneurs and startups.

A hallmark of New Orleans’ business landscape is the annual New Orleans Entrepreneur Week. Started by entrepreneurship-focused nonprofit Idea Village, this major event gives would-be founders a chance to learn, grow and even pitch their business ideas.

On top of strong community initiatives to support new businesses, New Orleans also provides twin benefits of affordable local costs and business tax incentives that can help lower the economic barriers to starting a business.

4. Oklahoma City

Oklahoma is the last city that can boast an average founder age under 38 years old, and it’s also the city among the top 10 with the largest share of millennial founders, at 43.7%.

These young entrepreneurs can thank the solid network of support found in Oklahoma City and throughout the state, too — for instance, a business incentive act offers a tax break to Oklahoma businesses participating in certified business incubators.

Lastly, a low cost of living will help ensure founders can put their capital toward starting and growing their Oklahoma City startups — and not just keeping the lights on.

5. Charlotte, North Carolina

The average age of founders in this rapidly growing city is 38.21. In 2017, most of the $1 billion in venture capital raised by North Carolina entrepreneurs went to Charlotte-based companies. The flow of money into new Charlotte businesses is just one sign of the city’s healthy startup ecosystem.

Another is Charlotte’s large cohort of Generation Z entrepreneurs: a full 5.0% of Charlotte’s business founders fell into this college-aged (or younger) group. This could be thanks to the support and influence of UNC Charlotte’s Ventureprise entrepreneurship program, which provides business resources, trainings and certifications to students and Charlotte community members alike.

6. Minneapolis

Entrepreneurs are able to get a headstart on their startup goals in Minneapolis, where the average age of a business founder is 38.7 years old. The costs of starting a business here are kept low, thanks to the competitive living costs in the area and attractive tax incentives such as “angel tax credits,” which provide up to $1 million in for new, tech-centered businesses.

Minneapolis-based events, like Twin Cities Startup Week, can also give local entrepreneurs and businesses the perfect venue to network, promote and pitch themselves, and even raise capital. Another local initiative is the MN Cup, a statewide startup competition sponsored by the University of Minnesota — since its establishment, it’s seeded $2.4 million to local businesses.

Female entrepreneurs should also check out Women Venture, a local small-business nonprofit that helps women start and grow businesses in Minneapolis.

7. St. Louis

For young entrepreneurs, St. Louis provides a fertile environment in which business ideas and entrepreneurial ambition can grow — that’s thanks to a strong local startup scene and robust support network for new companies.

Local business investment foundations such as the Missouri Technology Corporation, Arch Grants and St. Louis Accelerator provide vital investment and grant dollars to attract and grow leading young businesses.

These are just a few of the incubators, accelerators and initiatives that provide enough support to young entrepreneurs to allow a typical founder to start a business as young as 38.8 years old.

8. Portland, Ore.

When inspiration strikes, young entrepreneurs in Portland, Ore. aren’t afraid to strike out on their own. But they don’t have to go it alone, thanks to incubators and accelerators such as Prosper PortlandPortland Incubator Experiment (PIE) and Portland Seed Fund.

The average founder in Portland is just under 39 years old. Home to campuses for leading brands such as Nike, Columbia Sportswear and Intel, Portland and the state of Oregon offer business-friendly corporate tax structures. New entrepreneurs should investigate tax incentives that can help lower their new business’ property and income taxes.

9. Milwaukee

The secret for Milwaukee’s young entrepreneurs, just under 39 years on average, could be the city’s low costs for businesses. Milwaukee’s lower cost of living combines with attractive tax incentives, exemptions and credits to make it more affordable for founders to start and ramp up a new business.

Entrepreneurial hopefuls can find plenty of backing in the Milwaukee area. Startup Milwaukee, for example, provides education and networking through Milwaukee Startup Week and similar initiatives. BizStarts offers further resources for local entrepreneurs, while other incubators like Milwaukee 7 can provide capital and funding for young companies.

10. Austin, Texas

Last on the list is Austin, the only city on this list in which the average new business founder is over age 39. From hosting innovation-centric conference South by Southwest (SXSW) to a booming local economy, this fast-growing city is a hub of entrepreneurship in Texas.

Several startup accelerators and incubators in Austin can help local founders grow a business at an stage. A bevy of newer venture capital firms in the area, like ATX Seed Ventures and LiveOak Venture Partners, could be spell good news for young businesses hoping to attract funding.

For young entrepreneurs, the right location can help a new business thrive

If you’re hoping to become a full-time entrepreneur, you’re not alone. Nearly a third of Americans have thought about starting their own businesses in the past year, according to a recent LendingTree survey.

Before launching a business, however, it’s worthwhile to consider your location and how friendly it would be to a new and growing company. The better the location you choose, the faster you can work toward founding and building your business.

Based on the top 10 cities above, here are some trends to watch for when researching where to start your startup:

  • Growing local economy: A startup will need a healthy economy and other businesses to survive. Check key economic indicators in cities you’re interest in — low unemployment and high consumer confidence in your area are positive indicators of a healthy economy with room for new companies to take root.

  • Business-friendly tax policies: Among the top 10 cities, a common thread is business-friendly tax policies. Many of these cities charged lower taxes to local businesses, and some even provided tax incentives to attract new and expanding companies.

  • Low cost of living: With lower expenses, you’ll need less capital to get your business up and running. These low costs can also keep your bottom line growing faster and keep your new business lean and competitive.

  • Strong startup network: Most of the cities with the youngest entrepreneurs were also home to robust support systems and networks for new entrepreneurs and startups. Research your area of interest to see if it’s home to business incubators or accelerators, entrepreneurial networks or events or even a coworking space. Your local Chamber of Commerce or Small Business Administration office can be a great starting point to find business resources and organizations.

  • Availability of business funding: Lastly, research opportunities you might have to access or raise funds for your business. See if your city of interest is home to venture capital firms or programs that offer small business grants or other funding. Check out potential sources you could turn to for small business loans, too.

 

Being picky about finding the best place to start your business can really pay off later. This study shows that a good balance of low costs and a strong startup ecosystem can help young entrepreneurs found a business years earlier. Even better, these factors can set a new business up for continued success in the quarters and years to come.

Methodology:
Anonymized data of borrowers seeking business loans on the LendingTree platform was limited analyzed to determine the average age of business founder in the 50 largest metropolitan statistical areas (MSAs). The data was limited to businesses founded within the last five years, and founders’ ages are from the date they founded their businesses. Generations are defined by the Pew Research Center as follows: members of the Silent Generation were born between 1928 and 1945; the Baby Boom generation between 1946 and 1964; Generation X between 1965 and 1980; the millennial generation between 1981 and 1996; and Generation Z after 1996.