Entrepreneur magazine recently listed Sacramento among "9 Hot Startup Cities that Aren’t San Francisco or New York." Coming from Silicon Valley myself, I absolutely love the Sacramento region. As an app developer I work with many Bay Area startups, and it’s amazing how the hyper growth of Silicon Valley has inflated everything from rent to traffic. In this light, here’s advice to Silicon Valley startups and five reasons to relocate your startup to the Sacramento region.
5. It’s the seat of power for California, the eighth-largest economy in the world. Being the capital of California, Sacramento is often seen as a government town (which it is). Many think of this as a detriment. I, however, see many advantages:
- If your startup is able to do business with a state agency, your startup will have a reliable source of revenue. Pondera Solutions is an example of a startup that developed a technology whose first client was the California state government.
- If your startup has encountered regulatory issues, being in Sacramento will give you opportunity to develop personal relationships with state legislators and lobbyists who can help your efforts.
- Sacramento also is the home of many associations that lobby the Legislature. Some of these associations may be critical to developing your customer base. For example, if you are developing a medical device and want to be able to reach physicians, a good place to start is developing a relationship with the California Medical Association (which represents 40,000 California physicians) — and the association happens to be headquartered in Sacramento.
4. Sacramento has a highly educated population: 30 percent of the population is college graduates and the city is supported by four major institutions of higher education: UC Davis, Sacramento State, University of Pacific and Los Rios Community College District. (Not to mention the Bay Area transplants like me). Interestingly enough, 80,000 people from the Sacramento region commute to the Bay Area on a weekly basis, which also a good source to draw upon.
3. Your startup will have a longer runway. In general, co-working spaces in Sacramento are about 40 percent cheaper. The average salary in Sacramento is about a third less than in the Bay Area. Overall, real estate is a staggering 61 percent less expensive than in San Francisco. With the Bay Area’s explosive growth, I think the actual number is even greater in favor of the Sacramento region.
2. Sacramento is a stone’s throw from Silicon Valley. If you time it right, you can make it to Silicon Valley for that investor pitch on Sand Hill Road in two hours. All the benefits (and misery) of the Bay Area are within driving distance.
1. The Sacramento Region offers a wonderful quality of life. Sure, you’re making a good salary in the Bay Area. But what’s your quality of life like? How long is your commute? Can you afford a decent home? Sacramento offers affordable, decent housing. The commute is reasonable. We have a great trail system with the American and Sacramento rivers as a back drop. In addition, we’re a foodie town leading the farm-to-fork movement. So, in the end, ask yourself: "What’s it all about?" Sacramento offers an environment that will allow you to smell the flowers.
This story was reprinted from LinkedIn Pulse with permission from the author.