Phoenix had the highest rate of entrepreneurial activity of any state last year—beating out the traditional “Big Three”, (Silicon Valley, New York, and Boston), and the “Up-and-Coming Three” (Denver, Austin, Los Angeles). The Start-Up boom is attributable to the culmination of vision, patience, and commitment.
Unlike start-up mecca’s, like Silicon Valley, the Phoenix area desert is not historically rich with venture capitalist dollars. The shift toward promoting new business has resulted from entrepreneurs who have the vision to recognize the value in the Phoenix area’s lower operating costs and drastically lower cost of living—including lower cost housing, food, sales and income tax. Indeed, living and business expenses in the Phoenix area can be as low as 40% of the Big Three cities. This financial freedom helps to reduce the stress of creating a Start-Up. In addition, less competition, the healthy work/life balance and the lower cost of living all help Start-Ups recruit the talent that is vital to their success.
Growing anything in the desert also requires patience. It took time for Arizona government to shift their business growth strategy away from tax breaks (which only benefit billion dollar corporations). They are now focused on directly engaging in and supporting entrepreneur friendly programs that help fund innovation at all stages.
Finally, the boom has required commitment and active partnership between more than entrepreneurs and government. The need is to create a culture that promotes risk and innovation.
The Phoenix area offers the ability to build a business while still enjoying great quality of life—quickly turning the Valley of the Sun into the new Valley of the Start-Ups