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When I wrote a guest column in this space back in late November lauding Arizona as a hotbed for tech startups, I never could have anticipated the backlash the story generated.
Among my peers in Arizona, the general sentiment was, “it’s about time we got a little positive attention.” But strangely, there was a good deal of negative energy coming from our neighbors to the west — specifically people in Silicon Valley. Across my social networks and the networks of several of my friends and colleagues, the perception was still that Arizona’s quaint little tech sector was some kind of joke. That negative sentiment even prompted this rebuttal from the Phoenix Business Journal.
Now I’m back to continue this story about why Arizona has become such an attractive place for entrepreneurs — especially those in the tech sector. After all, I’m evidence that this is a great place to start a successful technology business. With SpotlightSales.com, I’m on my third Arizona tech startup.
There are a lot of reasons why Arizona’s tech sector is rising, and here are several for those that disagree:
1) There is more talent here than you realize. The homegrown talent has become exceptional and the universities have a lot to do with that. Arizona State University in particular has become oriented to, and invested in, producing graduates with an entrepreneurial attitude. When you add how attractive Arizona can be for people who are asked to move from other states, the overall talent pool is getting much deeper.
2) The hiring numbers don’t lie. Despite what you might hear in the national news about our sometimes controversial politicians, the state government has fostered an environment that’s conducive to business. As a result, more companies are taking advantage of Arizona’s overall attractiveness. For example, it’s much easier to invest in facilities and operations in Arizona than in many other places. This is evidenced by a large number of hiring announcements in the Phoenix area over the past year, including Zenefits (1,300 jobs to Scottsdale) and Silicon Valley Bank (250 jobs in Tempe). It’s not surprising to see this kind of movement when Inc. Magazine ranked Phoenix among the best cities in the country for startups and Arizona State University was ranked No. 2 in global student entrepreneurs.
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3) Arizona is short on traditional weaknesses. Oddly enough, one of Arizona’s major advantages is that it doesn’t have any significant disadvantages to overcome. Climate and economic stagnation are difficult issues for some states in the midwest, for example. Budget issues in California are a great concern, especially as they relate to investments in education, which is critically important to people with families. And the disparity in cost-of-living between Arizona ( and California (not to mention other heavily populated east coast locales) continues to be staggeringly large.
4) We’ve had big success stories. There’s a misconception that companies can’t start here or make it big here without needing to relocate elsewhere, like the Bay Area. In the past decade, both Arizona-based GoDaddy and Lifelock have turned into industry giants. Others like Infusionsoft, Limelight, 41st Parameter, and WebPT also immediately come to mind when it comes to big-time technology success stories. And those are just ones in my area of focus: software.
If you caught the Taylor Swift reference in the headline, here’s another one for you: To all those in Silicon Valley and elsewhere who still view Arizona as some sort of desert wasteland with little more to the economy than tourism and sprawl, maybe it’s time you shake off that perception.
Don Pierson has been an entrepreneur in Phoenix for over 25 years. After his previous tech startup Flypaper was acquired by Trivantis in 2012, he joined on as CEO of the startup company SpotlightSales, a performance software platform for virtual and geographically-dispersed sales teams.
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