6 places you can find the next Silicon Valley

Posted September 25

The race to find the next Silicon Valley continues to meander in all sorts of directions across the country. The latest leader in potential cities? St. Louis. (Deseret Photo)

The race to find the next Silicon Valley continues to meander in all sorts of directions across the country.

The latest leader in potential cities? St. Louis.

As Ben Casselman of FiveThirtyEight reported this week, the Midwestern city has seen a heavy increase in startup businesses, despite the fact that the country as a whole has seen a dip in the trend. In 2014, the national startup rate fell 8 percent. In fact, that same year, Gallup noted that there was a decline in new businesses, as startups struggled to find financing for their ventures.

“The rate at which Americans start businesses has been falling for more than three decades, and while the decline has slowed in recent years, it has shown no sign of reversing,” Casselman wrote.

But data from the Census Bureau show something different for St. Louis. About 9.7 percent of the businesses in the city are startups, which is 3 percent higher than in 2009. The only other city that could claim a similar statistic is Elizabethtown, Kentucky.

Still, St. Louis has some pretty high numbers, as do some cities in the Missouri area. Among the top 20 cities with the fastest-growing startups, four are in Missouri — St. Louis, Springfield, St. Joseph and Kansas City.

St. Louis’ rise actually says something about the greater growth in business across the country.

“On the one hand, it isn’t surprising to see Missouri making progress,” Casselman wrote. “Both the state’s public and private sectors have been unusually aggressive in promoting entrepreneurship. The state has its own investment fund, the Missouri Technology Corporation, which invests in local businesses; the fund, together with newly formed private investment groups, have helped the state emerge as a regional leader in startup financing.”

But the Midwest, or specifically St. Louis and the state of Missouri, aren’t the only locations to see such a jump in startups and successful businesses. Here’s a look at a few other cities that have been identified as the potential new Silicon Valley.

Salt Lake City (and Utah)

In a piece written in February 2015, The New Yorker reported that Salt Lake City and its surrounding cities have the potential to become the next Silicon Valley. Utah has seen a number of different firms pop up in places like Lehi and Provo, especially ones that deal with medical devices and aerospace products, according to The New Yorker.

Salt Lake City’s time as a new tech hub may already be underway. Tech organizations in the Beehive State have united under the banner Silicon Slopes, after all.

This comes as a surprise to some, since Utah is generally ignored by the nation at large when it comes to new businesses.

“We don’t pay attention to Utah much, and Utah clearly sticks to its own affairs,” Mark Muro, a fellow at the Brookings Institution, told The New Yorker. “There’s a sense that they’re not like some metros, selling themselves externally, and yet, they do seem to be executing.”

But the reasons make sense. As CNBC reported, the Mormon population, which makes up the bulk of those who live in Utah, tends to have an entrepreneurial spirit that inspires them to start their own companies.

And, unlike some other cities across the nation, the Salt Lake Valley is relatively cheap for new business owners.

“Low taxes; cheap real estate; a pool of young engineering talent from the University of Utah, Utah State and Brigham Young; and a business-friendly environment have all converged to make Utah the top location for tech start-ups, right up there with founding teams in Boston and New York in the East or Seattle and Silicon Valley in the West,” according to CNBC.


The humble city of Pittsburgh — a Silicon Valley for steel back in its heyday — may be on track for a return to the national spotlight. The city, according to The Atlantic’s John Tierney, serves as an example for how to create a new startup hub.

The city has a wide range of popular colleges and universities — there are more than 40 in the metro area alone, which includes the University of Pittsburgh and Carnegie Mellon University, both of which are ranked highly among industry leaders for their tech and science programs.

There are also a lot of local financing companies in the Pittsburgh area that help new business owners start up their new projects, Tierney wrote. It’s also a small enough city that it becomes manageable for business owners because the community looks to help out.

“People here want to help,” Ilana Diamond, the managing director of AlphaLab Gear, told The Atlantic. “When I moved here, I was struck from literally the first visit by how friendly, open and welcoming people are here. If you’re stuck with a problem, people will say, ‘Oh, I know somebody who can help you solve that.’ That seemed to be the attitude. And that’s why my husband wanted to come to CMU rather than accept offers in Boston or Palo Alto. The people here are so collegial and so supportive. And we hear that from entrepreneurs who come to town. They comment on it, too.”

San Diego

The next Silicon Valley may lay just a few hundred miles to the south in San Diego.

As CNBC reported, San Diego has a number of factors helping it become the latest version of Silicon Valley. It’s got a beautiful eco system that draws people to live there, but is also known for “the fact it has developed itself as a center of excellence in biotech and life sciences, mobile technology and aerospace research,” CNBC reported.

The city is also home to a number of venture financing firms, which invested $1.28 billion in San Diego businesses back in 2015, according to CNBC.

The city often looks at its local talent and provides them the funds to create businesses. In fact, according to CNBC, the city is home to a number of startup incubators — like The Nest and iHive — that push local entrepreneurs to create their own businesses.

"What we bring is an amazing digital workforce, a population of young millennials, mid-career and even older people in the workforce who have built technical solutions and products in San Diego — it's where we tackle the hard problems,” Darin Andersen, a serial start-up entrepreneur, told CNBC.


Orlando may be up next to receive Silicon Valley’s reputation.

Jerry Engel, a tech entrepreneur who works at I-Corps, a tech accelerator for students at the University of Central Florida, feels such. He said, according to the Orlando Business Journal, that the city has a chance to become the next Silicon Valley.

Not only does the city have a fully active university that inspires students to embrace tech, but it also has a culture that looks for innovative creations, he said.

“A community that celebrates and profits from innovation is within their grasp. There is so much more to Orlando than meets the eye,” he said. “When I come here with a Silicon Valley eye, what I see is the potential for a great innovation center, and that's not what Orlando is known for, but that's what people here can create. It doesn't have the potential to become the next Silicon Valley — it has the potential to become the next great Orlando, and that's much more important than becoming the next Silicon Valley. Every tech scene has its own image.”


We could go on and on with potential new successful startup cities. For example, Nav Athwal of Forbes said that Austin, Texas, Dallas, Seattle, Miami and Chicago all have the potential to become new tech hubs, mostly because the cities all have a high amount of working investors as well as recent population gains.

Boston has also been tapped as a potential new Silicon Valley. In fact, a study released earlier this year said that the Massachusetts capital has more innovative companies than the northern California valley.


There’s also the possibility that there won’t be a new Silicon Valley, as Richey Piiparinen, the director of the Center for Population Dynamics at Cleveland State University, wrote for The Huffington Post back in March 2016.

Since so many cities can potentially become the next Silicon Valley, in reality, there won’t be a next Silicon Valley since the area itself was an outlier.

“When it comes to tech, nobody can simply create the next Silicon Valley,” Aaron Renn, a senior fellow at the Manhattan Institute, explained to The Huffington Post. “Just because a place has a number of startups doesn’t mean it’s destined to be a Silicon Valley. By all means celebrate a growing tech industry, but don’t get carried away.”

Herb Scribner is a writer for Deseret Digital Media.


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