Does Startup Location Matter?

Location with a capital L matters. Anyone who has started a tech company in Colorado will likely tell you that in some ways you will be handicapped a bit by your location. Of course there are advantages to starting something in Colorado, Boulder specifically, but I think anyone who would say it's no different is kidding themselves. Sometimes it's just better to be where the action is and the action is in the Valley.

I had a meeting a few weeks back that got me thinking about location with a small L however. I was visiting a startup whose office was in a neighboring community in a light industrial park. I have several friends who match that description so if you're reading this, you have a startup in a remote industrial park, and you know me - I'm probably NOT talking about you, so don't get bent out of shape.

When I walked into the startups office it was like a morgue. No energy, no light, no excitement, no phone calls, no screaming, no coffee shops, nothing, nothing outside, 90 degree pavement in every direction, someone welding in the "office" next door. I had a nice meeting and when I left I had that shiver you get when you drive through an intersection in your car – look in the rear view mirror and see the horrible twisted carnage of a 3 car collision that you "almost "participated in. The smell of death was in the air and I hated it. The company is dying, they are all alone, and they are on the virtual moon by themselves.

All this got me thinking. Where should your startup be located? I used to be a huge advocate of the cheap office space off in the middle of nowhere. I mean it made sense, you have to be scrappy, don't spend money on the location spend money on the people –right?

When Lijit moved to Boulder over a year ago, it was hard to rationalize (for me). The office space was more expensive, a lot more distractions in town, the parking is expensive. Why would you do that? Now after another year of Lijit under my belt and exposure to Boulder I get it and would never go back to remote model. What changed?

Moving to Boulder has been the best cultural thing we ever did. We are constantly surrounded by smart successful people, with smart successful business that we can and do leverage everyday. These relationships depend on our ability to "capture" these moments a little at a time. Meetings where interactions become scheduled events destroy the entire effect. Today alone I talked with a Lijit board member in the coffee shop, ate lunch with a successful entrepreneur from the Foundry Group offices, talked with one of my investors in the street by the office, and met with the founder of an interactive ad agency and never got in my car. In fact, none of those were planned meetings.

My conclusion is that the closer you can get to smart people, the more likely some of it will rub off on your company, your staff, and yourself.

Comments

[jvaleski]

well scribed my friend. location location location! where have I heard that before?

[Tara Anderson]

I am grateful every day for Lijit's move to Boulder. In addition to the fantastic culture, our office is now only a one-mile bike ride down the bike path from my house. If that doesn't make for a happy employee, I don't know what does.

[rando]

Yes! but I would transform it to a different aspect: attitude of the company as set by the execs. I have worked with too many execs who see employees as interchangeable parts and workspace as a place with a roof where the employees crank out stuff. And fortunately I have been to places like lijit where walking in the front door hits you in the face with a blast of quirky, creative, human energy. You think "hmmm... something cool could happen here." If the culture is one of creating and respect for the talents of the people, it shows in a way that can be seen by every employee and customer (and potential employee and customer). I'm not sure the location matters as much as the fact that the CEO *cares* about the location.

[Brad Wisler]

Boulder's physical environment and vibrant culture promotes connectivity. This is a critical component to the success of startups. Success is where preparation meets opportunity, right? Well, you're screwed if you're physically isolated from opportunity. Bloomington, IN has the same kind of environment, even though our startup scene is younger than Boulder's. Being downtown where you can walk or bike wherever you need to go creates countless random run-ins with opportunity. If you've never been here, check out http://sproutbox.com/what/bloomington for a peek.

[Chris]

This is a VERY intersting topic Todd. I would argue that here in the Front Range of Colorado, there are four areas where seasoned senior executives live: Boulder/Longmont, Central Denver, Evergreen/Genesee, and Cherry Hills/Greenwood Village.

I agree that Boulder is a great place for a company to be located. No argument there. That said, if the goal is to make the company (reasonably) accessible to as much senior talent as possible, the Company should be located close to downtown Denver. It's the one place where you can attract employees from all four pools of talent.

Not questioning how great it is to be in Boulder. Merely sugguesting a different axis upong which to view the question.