Business Startups

In 2015, Forbes pitted Austin and Silicon Valley against each other as the best hub for startups. Though Silicon Valley is home to notable companies like Google and Apple, it’s an expensive place for a business to establish its roots. Meanwhile, Austin offers many of the same tech and business benefits as Silicon Valley — without the high price tag.

Could Austin Become the Next Silicon Valley?

Between 2001 and 2013, Austin saw a 41% increase in tech-industry employment. It’s expected that Austin will provide more than 11,000 new tech-related jobs within the next five years. While Silicon valley has become one of the most expensive housing markets in the United States (with the median home price hovering around $2.3 million), Austin has remained relatively cheap (where the median home price is around $310,000).

Among these benefits, experts have seen numerous advantages to the Austin startup scene. Some of these include:

  • Lack of a personal income tax
  • A strong tech community
  • Thriving downtown scene
  • Few land-use and zoning restrictions
  • Better traffic/fewer traffic jams
  • 120 Austin newcomers every day
  • Unemployment rate of 3.2%
  • Anti-regulation and pro-business legislature
  • Texas incentive programs near $19 billion per year
  • Easy public transportation

While the Forbes article concluded that Austin is “unlikely to ever become a serious contender to the Bay Area’s throne,” it’s clear that it should rank high on the list for any entrepreneur or startup. Whether or not Austin could become the next Silicon Valley, it’s been pegged as a “smaller, friendlier place to do business.” With its emphasis on smart growth, it doesn’t look like that will be changing anytime soon.

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Austin: The National Leader in Startups

In 2015, Austin was recognized as the national leader in startups by the Kauffman Index Report. Houston and San Antonio made the top ten cut as well, ranking eighth and tenth, respectively. The Kauffman Index Report reported the following statistics on Austin startups for 2015:

  • Austin had 180 total startup businesses.
  • Austin had the highest rate of new entrepreneurs at 0.55% (an average of 550 new entrepreneurs per 100,000 people per month).
  • Since 2011, Austin’s technology job base has grown 17.8%.
  • The Austin unemployment rate was lower than state and national averages.

In this report, Austin beat out Miami, Florida (#2); San Jose, CA (#3); Los Angeles, California (#4); and Denver, Colorado (#5). It also noted the strong job growth rate in Texas, which remained positive for five consecutive years.

It’s clear that Austin is a strong contender for startups. No matter where a business begins, those first few years set the foundation for its long-term success. If you’ve launched a startup or you’re in the planning stages of doing so, work with an experienced attorney to give your business the best chance of success.

Business Startup Attorney in Austin, TX

Natalie R. Lynch is committed to helping owners of private companies, including startups and small to mid-sized companies, navigate the lifecycle of change. She helps business owners create the right structures, contracts, and employment agreements to minimize business and employment risk factors. From entity formation to small business growth to expansion into the middle market, Natalie can help your business flourish. Contact Lynch Law Firm today.