The Silicon Desert: 5 Reasons Startups Love Las Vegas

October 8, 2015

5:00 pm

Every tech entrepreneur wants to work in Silicon Valley, but not everyone has the capital to get started in the most cost-prohibitive area of the country. From California’s corporate taxes to the absurd cost of living, the West Coast poses a daunting challenge for those starting a new tech business.But the solution for tech entrepreneurs can be found just a few hours east of San Jose in a seemingly unlikely place: Las Vegas.

 

Zappos founder Tony Hsieh was one of the first to recognize Vegas’ potential as a new hub for tech entrepreneurs. Hsieh’s $350 million Downtown Project aims to transform downtown Vegas into a place where startups can enjoy a supportive, engaging community in which to grow.

 

For tech entrepreneurs looking to make big waves quickly, no other city can provide the savings and opportunities that Vegas has to offer:

 

Taxes

Entrepreneurs in California have to deal with high business and personal taxes. These costs pose obstacles even to large companies, so startups face a much tougher challenge.

 

Because Nevada does not have a corporate income tax, entrepreneurs can worry more about the products and services they create and less about how much money the state government will want at the end of the year. Hsieh and other entrepreneurs flocking to Las Vegas show Silicon Valley that great minds can meet and create the technology of the future outside of the trendy tech hubs on the coast.

 

Creativity

With Hsieh’s Downtown Project, Las Vegas is attracting more artists and thinkers who want to be part of the culture-rich environment budding in the desert. Thanks to less regulatory oversight, lower licensing fees, and the aforementioned tax structures, Las Vegas is a beacon of second chances for those who faced difficulties during the Great Recession. When creative people live and work in close proximity, good things happen.

 

Growth

Not only have the population and economy of Las Vegas expanded in recent years, but the prospects for future growth also look promising. Multiple factors, including population statistics, median housing prices, and consumer confidence, all point to continued expansion. The sooner new businesses start in or relocate to Las Vegas, the longer they will have to take advantage of tremendous growth opportunities.

 

Audience

Thanks to tax shelters and warm weather, Las Vegas attracts thousands of wealthy homeowners and retirees from California and overseas. Nothing is better for business than a large pool of potential customers with money to spend, and with wealthy retirees spending freely in service industries, anyone who can provide a high-quality service in Las Vegas stands to be handsomely compensated.

 

Climate

It might sound far-fetched, but temperatures and weather patterns make a big difference to businesses — especially those that rely on foot traffic. No one wants to go out for a leisurely shopping trip with ice covering the roads and snow crowding the sidewalks. Las Vegas has a great climate with warm summers, mild winters, and a pleasant lack of natural disasters, so businesses that choose Nevada can rest easy knowing Mother Nature won’t put a premature end to their new headquarters.

 

When you next think about Las Vegas, don’t think about the Strip. Think about the booming startup culture downtown and all the exciting possibilities it holds for entrepreneurs and tech startups.

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John Stevenson is the founder of John Stevenson Consulting, a Las Vegas-based consulting team that specializes in providing local businesses with customer leads and business coaching. John’s expertise in consulting, business planning, and management were developed during his tenure as president and CEO of J&J Window-Wash.

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