When we first received funding in 2012 and joined the 500 Startups accelerator in Silicon Valley, we hit what many others would consider the startup jackpot for relocation. But when the program ended we pivoted our company into an Influencer Marketing Platform and began generating revenue immediately, forcing us to make decisions on where to scale out our team.
When it comes time to hire you think about permanency more, lifestyle more, and of course, finances more. We had always been drawn to Austin, the smaller and weirder city that is also known for technology and talent.
There are tech hot spots popping up all over the country — Colorado, Washington DC, Raleigh, NC among others — but the appeal of Austin was too great for us to ignore. We moved our tech startup to Austin, and here’s three reasons why you should too. After all, twice as many people leave California for Texas out of any other state in the country.
Growing tech scene and fresh talent.
It’s no secret that the tech scene has been growing rapidly in Austin over the last several years, but I don’t think people realize just how much. Dell and IBM are two of the city’s largest employers, while Apple has brought more than 5,000 jobs to the city by way of its new 38-acre campus. Stalwarts like Facebook, Amazon, Google, and Rackspace all have offices in Austin too.
The University of Texas at Austin has a lively, large campus of over 51,000 students that are eager to find employment within the city upon graduation. It’s no wonder UT students are in high demand — with the most popular majors being Business and Engineering, over 13,000 qualified graduates enter the job market each year.
And how could you forget SXSW, which has become the go-to conference for innovation each year and has launched platforms like Twitter, Foursquare, and Meerkat? Innovation breeds innovation, and there’s plenty of it in Austin.
Plenty of funding opportunities.
Many think a Silicon Valley address is a requirement in order to gain access to funding that can help grow your company. Austin proves otherwise, as the city had one of its best years ever in 2014 in terms of startup funding secured, bringing in a total of $993M for 115 companies. The city also saw $437M paid from exits, including 29 acquisitions and two IPOs.
Why is this important? It means investors aren’t honed in only on the SV area, and that Austin has built a reputation as a tech hub that breeds successful and innovative companies. As a startup, you want to know that you have access to funds should you need them. Plus, Austin is centrally located between San Francisco and NYC making flights to either coast a breeze.
Cost of living is 50 percent less.
We all remember the story from earlier this year when a Yelp employee wrote a blog post about how she spends 80 percent of her salary paying rent in San Francisco. This is a sad but true reality for many tech workers in Silicon Valley right now — the cost of living is just too high.
A recent study shows that while a software engineer makes more on average in San Francisco than in Austin, when adjusted based on cost of living in San Francisco, the Austin salary ($195K) trumps the SF salary ($132K) by almost 50 percent.
Median home prices in SF ($1.1M) are astronomical compared to Austin ($290,000) and the rental market for one bedroom apartments ($3,500 in SF; $1,200 in Austin) follow suit. As a startup, you want your employees to give you their all, as well as enjoy a comfortable life outside of the office.
For tech startups, Austin should no longer be looked at as an alternative, but instead as a destination. Filled with opportunity, access to other innovators, and incredible talent, it’s the ideal breeding ground for the next great technologies — all while enjoying great tacos and live music.