Your hands are full, breaking through as a startup entrepreneur. Orchestrating a successful business launch spans concerns ranging from funding to product development, so there are a lot of things to think about, before setting out to make your first sale. Among the widespread considerations influencing your startup direction, the location you choose can have a significant impact on your commercial success and lasting power in a competitive marketplace.

You’ve probably heard the perennial mantra, “location, location, location.” While the notion is often associated with residential real estate, describing the importance of choosing the right neighborhood, it also applies to small business. A recent article by Entrepreneur guest writer, Glendowlyn Thames, explored some of the angles to consider, when selecting a spot for your startup venture.

Beat the Odds in the Right Locale

Startups face intimidating odds. Tech-oriented ventures, in particular, are vulnerable to market forces that often win out, ultimately causing many to prematurely fail. It is thought approximately 70 percent of tech startups fail – often around 20 months after first raising capital to launch. Money isn’t always the problem causing new companies to drop out; small businesses have access to capital, representing tens of billions in annual startup investment.

Staffing, competition, consumer preferences, and a host of additional variables contribute to startup outcomes, so identifying a precise winning formula can be challenging for a fledgling business. Your due diligence can tip the scales, so it’s in your best interest to cover all the bases – including thoroughly vetting prospective locations. To hit the ground running in a location that can grow with your business, consider the following startup concerns.

Sprout Funding logoAvailable Talent – Drawing top talent is a prime concern for startups. No matter which stage of development your organization is forging through, skilled collaborators are among your most important non-capital assets.

Though you may be operating in a global marketplace, the site you choose defines the available talent pool; you’ll need local access to experienced managers and ideally, entrepreneurial partners with direct experience running ventures like yours.

Author, Thames, points out that your forward-looking ideas, innovative concepts, and intellectual strength can only take you so far. In order to succeed in business, you’ll also need help crafting a scalable business model, making effective pitches, and growing your enterprise over time. Access to talent, proximate to your startup site, bridges these requirements, giving you a competitive edge in your niche.

The Right Ecosystem – Each upstart business has different requirements, so it’s important to choose a location with an ecosystem matching your commercial needs. Defining your unique business requirements before setting out enables you to situate where the talent and infrastructure already exist. Launching a biotech business? Boston may provide scalable solutions. Starting up in a digital technology field? Austin has emerged as a hub with tools in place to propel growth in that area.

Launching without a favorable ecosystem behind you means you’ll have to build it yourself, which may be an insurmountable task – particularly for an emerging operation, with limited startup resources. Not only does framing the proper infrastructure require you to lure your own experts from other locations, but you may also run short of supporting entities needed to lift your venture.

Networking Opportunities – It is the consistent cross-pollination of ideas that keeps innovation moving forward. Without networking potential near your startup site, it’s easy to grow stagnant and fall behind competitors. Prime business locations have a strong networking foundation you can use to move your business plan forward, from day one.

According to the Entrepreneur piece, the social capital startups need is not only present, but pronounced in hub regions such as Silicon Valley and Boulder. From informal meet-ups to full-blown networking events, a burgeoning body of collaborators related to your business can be a source of:

  • Mentors
  • Board Members
  • Partnerships
  • Investors
  • Sales Opportunities

Nearby Colleges – Startups rely on progressive practices, so a strong higher education presence, producing a steady supply of intellectual capital, ensures you’re always operating on the cutting edge – or at least aware of what that represents in your industry. Having the right mix of influences sets apart cities with high levels of entrepreneurism. A history of close interaction between progressive companies, research universities, and the venture community is one such important feature to look for when vetting prospective startup sites.

Absent colleges and research institutions, a city may not carry your business to the next level. Pittsburgh, for instance, was not a hotbed of startup activity, but now ranks among the top five regions for attracting and developing standout tech talent. It is thought the efforts of Carnegie Mellon University and other institutions are largely responsible for Pittsburgh’s emerging designation as a startup hub. In another example of the way higher education supports startup success, Yale University is a clear source of momentum, propelling the region’s bioscience sector.

Real Estate Spending – Physical space to conduct business is an indispensable resource, so real estate costs should figure prominently in your decision to locate your startup. High prices may be driving away business ventures from expensive regions such as Silicon Valley, providing lessons to help you avoid overspending.


Rather than stretch yourself thin buying or leasing office space, it makes sense to consider alternatives within the increasing number of viable sites. To attract industry, policymakers are proactive in some areas, subsidizing real estate and offering affordable options. And if you meet particular criteria, incubators and accelerators may provide suitable space, at a fraction of the cost of competitive market rates.

Among the many considerations driving startup success, location is a prime concern for business entrepreneurs. Before selecting a site, it’s important to vet potential business locations, evaluating talent availability, networking opportunities, property costs, and the presence of a supportive ecosystem.

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