I sipped espresso with a fellow entrepreneur yesterday morning as we waded into the ocean to watch the sun rise over the Florida Keys. You’d think this was more of a vacation experience, but this founder has decided to call Key West his home.
I can’t blame him. The beaches are beautiful and the weather is consistently gorgeous. But this entrepreneur isn’t the only one who is growing his company from a traditionally tourist-centric city.
Further West, Thea Chase is challenging the status quo in Telluride, Colorado. This town is well known as a ski destination but has some interesting activity accumulating amidst the mountaintops.
“People love to come to Telluride,” Chase says. Admittedly, Chase is an ambassador for the community, serving as the Director of Telluride Venture Accelerator (TVA), an investment and mentorship program for startup entrepreneurs.
“It’s a very magical place,” Chase says of Telluride. “People come and they pause here. That impacts the entrepreneurs, obviously, because when they’re here they’re in a different frame.”
In our conversation, Chase recounts several successful investor and partner connections made for entrepreneurs thanks to the laid-back atmosphere in Telluride. Because of these connections are often made on the slopes, she calls the interactions “chairlift moments.”
Even further west, Las Vegas has made headlines as a hub for entrepreneurial activity. Thanks in part to large investments into the community from entrepreneurs like Zappos founder, Tony Hsieh, Vegas has branched out from its tourism roots and developed a strong reputation for growing tech startups.
"Tourism-oriented ecosystems (like Las Vegas) have an advantage in that eventually everyone will come through and generally people are more relaxed so you can really connect with them," said Frank Gruber, CEO of Tech.Co, a media company that relocated its headquarters to Las Vegas a few years ago when Hsieh invested $2.5 million to ramp up growth.
Some might call these cities tourist traps. But when I asked the founder in Key West what prompted him to start an office so far south, he said, “It’s very attractive from a hiring standpoint. Nobody is sad about coming to Key West for new employee orientation or a company retreat.”
Matt Gordon initially grew a twelve-person office in Indianapolis, Indiana for his software studio Expected Behavior, which creates tools for software developers including Instrumental, Doc Raptor, and Gauges. But he and three of his team’s partners moved down to Key West in January of this year.
“People in Key West are relaxed, happy, and ready to talk in a way you won’t find in a large city,” Gordon said. “The best benefit is morale. Growing a company can be a bumpy ride. If you’re having a rough time, go stand on the beach for 10 minutes. It’s hard to stay sad.”
But is it all sunshine and smooth sailing?
Despite all of the perks of living in a tourism-centric city, you might not have access to the entrepreneurial resources that you’d find in a more traditional business location.
“Key West doesn’t have a lot of local technologists,” Gordon said. “If you’re used to strong local tech communities that cities like Indianapolis have, you’re going to need to find that online.”
Gruber corroborates the story based on his experience growing his Las Vegas office, saying, “Oftentimes, the reputations of tourism-oriented ecosystems prevent people or businesses from more deeply exploring the opportunities that exist… individuals may miss out on interesting jobs or startups, investors may miss out on new companies, and businesses may miss out on lucrative partnerships."
In more remote locations like Telluride and Key West, even getting in and out of the city can be a challenge.
“Sure it’s hard to get here,” says Thea Chase. “But once you get here you really relax.” —something that can’t be said for churn-and-burn communities like Manhattan or unicorn-obsessed areas like Silicon Valley.
Like any good accelerator, TVA pulls mentors and investors into their city from around the world. “They might be based in New York or the Bay Area,” Chase says. “But when they’re here they’re chill,” giving entrepreneurs an opportunity to truly connect while the mentors have their guard down.
So how do you know if a traditionally “touristy” city is right for your business?
If you have a tourism-oriented startup, it’s probably a no-brainer to at least consider these areas. But even if you have a more traditional SaaS or B2B business, you might want to consider the track record.
With more than 760 Las Vegas startups on Angel List, and many more that remain unlisted, you’d be in good company growing your startup. And Telluride Venture Accelerator has already graduated 3 cohorts of startup, with those companies going on to raise more than $8 million dollars in the first two years.
So you might apply to TVA (their app closes at the end of this week) or another accelerator in a tourism-centric city. But at the very least, I encourage you to try out a different kind of touring.
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