4 Reasons Your Startup Doesn’t Belong in Suburbia

March 1, 2015

10:00 am

Suburban office park or urban core?  That is the question startups often wrestle with as they consider signing a new lease.  Too often the decision is made purely on short-term financial grounds — they managed to score a mediocre suburban space at a super cheap discount. What startups fail to realize is that there are some far-reaching disadvantages to being headquartered apart from an urban core. These drawbacks can jeopardize the health of a company in the long run.

As someone who has years of experience working in both urban downtown and suburban office settings, I can relate four differentiators that impact the lifeblood of a startup.

1. Talent Pool

By being in close proximity to dozens of other companies big and small, a startup has regular access to talent in neighboring organizations. From getting coffee to attending seminars and other functions, being in close physical proximity allows for numerous opportunities to interact in social settings. Personally, I lost count of how many people I have seen apply for a job at my company because they happen to ride the train with an existing employee. Job applicants are also more likely to consider interviewing at a company if they could do so during an extended lunch break — something made possible by being in close proximity to their current employer.

2. Restaurants

Often overlooked, restaurants play a vital role in the success of a business. From lunches with clients to executive dining, restaurant quality and selection can make or break a deal. Being in the heart of a city means having numerous alternatives to choose from when searching for the perfect dining venue. Employee birthday celebrations, happy hours, catering options for meetings, and farewell lunches are all enhanced by being located in an area with a high concentration of restaurants.

3. Public Transportation

Easy access to public transportation is essential for drawing in top talent. This is especially true when trying to attract foreign workers who may be accustomed to high-speed transit in dense urban centers. Local governments also tend to partner with downtown companies to encourage public transit ridership by offering subsidized passes. And for companies fortunate enough to reside in a city with convenient downtown-to-airport public transportation, there is a savings in travel costs for both visitors and traveling employees.

4. Cultural Amenities

The central business districts of metropolitan areas offer cultural amenities that cannot be matched by the suburbs. Treating guests and employees to a midday sporting event is entirely feasible when one’s office building is within walking distance to the stadium. Taking an afternoon stroll along a waterfront trail, enjoying lunch in the sunshine at a city park, spending some quiet time in the public library . . . these are all amenities that come for free when working in downtown. All of this adds to employee satisfaction and contributes to reducing turnover.

Now Make the Move . . .

There is a reason the city is what it is today — a highly dense hub of commerce. The infrastructure has already been built, and startups simply need to move in and take advantage of the economies of scale creating by existing companies. This migration trend is currently take place in Silicon Valley where tech companies are flocking north to urban San Francisco.

So what are you waiting for? Go get your startup out of suburbia and join the movement to revitalize our cities. Your employees, customers, investors, and new neighbors will thank you.

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Raymond Tse is a social researcher who enjoys writing about technology and startups.

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