When launching a business, not all startup hubs are created equal. For those entering Silicon Valley, New York City, or other notable startup hubs, finding a location that fits your company’s specific needs can mean the difference between swimming and sinking. To succeed — particularly for those developing breakthrough technologies — entrepreneurs must have a keen eye for costs of doing business, entrepreneurial resources, talent availability, and network options. Without these key ingredients, you might as well get out of the kitchen.
When starting my business, I found a smaller business climate was integral to success and expansion. Here’s why I chose Vermont — a place that may be known for its cows and maple syrup, but in actuality, is a successful place to scale early-stage tech companies.
You get easier access to state and local resources
In many large tech hubs, the majority of companies are “small fish,” and access to the government officials who influence the local business climate is next to impossible. As my company grew in Vermont, we found organizations like the State Securities Regulators and Department of Financial Regulation to be very open and accessible sounding boards during our development process. Access to state resources has given us great insight into the current position and the future perspective on the many evolving securities regulations that guide our business. Other homegrown companies that have experienced this advantage include Dealer.com, which utilizes assistance from programs like Vermont HITEC to help identify and train employees from a pool of Vermont locals. Logic Supply uses the Vermont Employment Growth Incentive (VEGI), a program that helps companies to hire locals through cash incentives.
Another helpful program that has resulted from these close company/state relationships is the Vermont Training Program, a fund that reimburses businesses for up to 50 percent of the wages of trainees until they are fully productive in their role.
Additionally, the Talent Pipeline Management Project, a program adopted from the U.S. Chamber of Commerce Foundation, plays a critical role in developing talent in the state. By engaging employers from around the state, Vermont is able to determine specific talent needs and relay that information to education providers.
You become truly an integral part of the startup community
When building a new business — specifically for early-stage technologies — network is crucial. Places like Vermont, where the community is committed to building businesses and supporting local entrepreneurs, already have a strong network in place. Entrepreneurs can efficiently find other people in their space and quickly receive feedback. Local incubators like VCET and Burlington Generator can also help to build these networks and explain the local investor landscape to you.
Knowing who’s who in a smaller environment provides the first steps for breaking down the barriers associated with being a new business. That luxury isn’t available in more saturated markets, where the only way to succeed is to eliminate the competition. With a tighter and more collaborative environment, the ability to access others, get meetings, and develop nimbly ultimately speeds up development.
Lower cost of operations eases financial burden
Early-stage companies can sink when faced with many minor business costs that quickly add up. Vermont’s cost of operations is minimal in comparison to major markets like New York City. Vermont — and other lesser-known employment hubs — offers competitive numbers for office space, cost of living, and average compensation.
However, Vermont, like anywhere, has room for growth. State and city leaders are actively working to improve its talent recruitment, distribution capabilities, and travel options to ensure it continues to assist its rapidly growing companies. I’ve found that the areas where my company saves outweigh the areas where we spend a little more. As such, the net cost is far less when compared to major tech hubs.
The quality of life can be pretty superb
Similar to company perks, location perks can have just as much of an impact on talent attraction. With a thriving outdoors scene — from dirt biking, hiking, skiing and more — there is no shortage of things to do in Vermont. In fact, the state was recently ranked the No. 3 best state to live by CNBC, which is no surprise since the state has about 13 million visitors every year.
Vermont also offers great universities with programs in science, engineering, entrepreneurship, finance, and medicine, along with top-notch medical centers. Vermont is also the safest state in the nation, reporting just 118 violent crimes per 100,000 state residents in 2015.
While many startups may find their sweet spots in major tech hubs like Silicon Valley, not all startups require the same resources and can find what they need to succeed outside of large tech hubs. For those developing early-stage technologies, finding a network that will support their ideas is critical for market penetration.
Aaron Pollak is a serial tech entrepreneur in Vermont. He is currently the CEO of a Burlington, Vermont-based business called Venture.co, with customers in 20+ states. He develops and maintains web applications used in the non-exchange listed securities industry. Prior to cofounding Venture.co, Pollak worked at Dynapower, overseeing product development and sales.