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Austin knocks San Fran out of the top spot for best startup hub

downtown austin startup hub

(AUSTIN BUSINESS NEWS) We’re number one! We’re number one! But can Austin sustain being the best startup hub around?

Second time champs, baby

We’re number one! We’re number one! For the second year in a row, Austin has been named the #1 city for start-ups in the US. As the city continues to grow, at times to the dismay of native Austinites, the tech culture has become stronger than ever.


How it’s decided

Each year, the Kaufmann Foundation releases their index of start-up rankings based on various factors, including the percentage of adults who become entrepreneurs within a given month. Though San Francisco and San Jose, aka Silicon Valley, are the home of huge technological hubs like Apple and Google, they have dropped down to a humble #8.

This downward plunge is due to the rise in cost of living, steep taxes, and strict regulations for businesses in California. As real estate prices soar, business newcomers flock to less expensive cities like Austin and Denver to pursue their passions.

Texas is crushing it

Every major city in Texas – Austin, Houston, San Antonio, and Dallas – is on the list as top 15 startup cities. As a state, Texas is considered friendly towards business. In addition, the cost of living is reasonable when compared to California and New York.

In Austin, I have heard starting your own business referred to as “drinking the Austin Kool-aid.” The enthusiasm for new projects is addicting, with events like SXSW and Austin Startup Week bringing the newest and most innovative technology.

It seems like everyone you meet has another project, business, or idea in addition to their full-time job. This is accepted, and to me almost seems expected. Kaufmann links the rise in entrepreneurship to having more opportunities to start something new, especially in cities like Austin.

As more people turn to starting their own businesses, having money is essential.

Though Silicon Valley offers big time connections, affordability remains a painful challenge.

However, the influx of entrepreneurs to that area is a factor in skyrocketing real estate prices. Could the same happen as Austin continues to top the charts?


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  1. Pingback: Delicious stats about the current state of startups - The American Genius

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