Why Midwest is Best (For Startups)

When most people think of startups, Silicon Valley is probably the first location that pops into their minds, and rightfully so. For the past few decades, developers and businesses have flocked to the Mecca of tech companies to be with the likes of Apple, HP, and other tech giants. Not to mention the growing startup community, (supposedly) amazing coffee, and like-minded people.

What many don’t realize, though, is that the Midwest is one of the fastest-growing tech scenes right now and it’s not to be overlooked.

Recently Forbes reported the fastest growing states for tech jobs in 2015. Here’s the top four states in the list, along with their annual growth (Source: Forbes):

  1. Minnesota: 8.36%

  2. Utah: 5.75%

  3. Nebraska: 5.22%

  4. Michigan: 4.47%

Notice something similar about three out of the top four states? That’s right: they are all in the Midwest, and with good reason, too. Why would so many young engineers want to work in these locations, you ask?

Cost of Living

In case you have not heard, living in San Francisco is kind of expensive. Just take a peek at this to get an idea of the average cost of typical items there compared to other locations.

The average cost of living in Midwest states, on the other hand, is among the lowest in the nation according to CNBC.

Michigan came in at 7th cheapest state to live in while Nebraska came in at a close second at the 8th cheapest state. And what about Minnesota? Even though it may not be one of the cheapest places to live (though it’s still in the top 30), Minnesota was named 2015’s Top State for Business, and for good reason too… The Twin Cities are constantly adding more to their technology infrastructure and this helps to attract modern startups looking for an equally modern home.

Climate

Though many may fear the Midwestern states for their frigid winters, some companies embrace it. Businesses with large data-centers, such as Facebook and Google are flocking to the midwest to build warehouses that take advantage of the chilly temps in order to reduce server operation costs and get land for nothing when compared to the cost in and around larger tech-hubs.

But you don’t need to be a huge company to reap the benefits of the Midwest seasons: the beauty alone is staggering and with the changing of the seasons come a slew of events and activities.

Atmosphere

With the recent influx of young techies, other businesses have benefitted as well. Restaurants in cities like Des Moines, IA, Lincoln, NE, and Minneapolis, MN have seen a increase in business and more are popping up all the time. Music scenes are heating up and attracting more (and larger) artists every year. Specialty stores, such as Raygun, have also seen a big boom in sales.

This, in turn, attracts more young engineers, and the vicious cycle of innovation and growth continues, benefiting the businesses, the employees, and the city.

There are also a slew of amazing places to visit, such as the Henry Doorly Zoo and, of course, the Mall of America to occupy your free time.

Existing Companies

A few startups in the Midwest beat the crowd and are now among the nation’s fastest growing, bringing with them the attention of investors and other hopeful startups.

One such example that many high-school football players are familiar with is Hudl: a platform to teams to upload video and scout others. Founded in 2006 in Lincoln, NE, Hudl is now Nebraska’s fastest growing company with 230 employees and counting.

Other early-birds include Flywheel, BuyNow, Igor, and many more.

Talent

With the still relatively-small pool of startups in the Silicon Prairie area, new companies may have an easier time finding qualified, capable employees than a similar-sized startup in San Francisco. This puts less pressure on the employee for finding a job that can support them and helps companies find the right candidates.

Conclusion

The Silicon Prairie could soon be the new go-to place for startups, and we’re already seeing a shift in interest with younger engineers who are looking for a cheaper, more friendly working environment.

I don’t believe that the Silicon Prairie will overcome the famous Silicon Valley hub, but that’s probably for the best: if everyone wanted to live here, the cost of living would go up and younger engineers might look elsewhere for job opportunities.

Having lived in Iowa, Nebraska, Missouri, and Wisconsin, I am a huge advocate for the growing startup scene here (as if you can’t tell by now). Feel free to ping me on Twitter if you want to chat about tech and what it’s like to live in the Midwest.