When most people think about software companies in terms of their geography, cities like San Francisco, San Jose, New York City, and Boston likely come to mind. The Bay Area itself has long been synonymous with startup culture in the US, especially for those building software companies.
However, with the continued rise of San Francisco’s cost of living, and the growth of new solutions empowering distributed workforces, many companies are looking elsewhere as a starting location for their firm. In recent research on the 10 best states to launch your startup, Massachusetts and California took the no. 1 and no. 2 spots, respectively, but Colorado, Utah, and Washington state also made the list.
SEE: IT jobs 2018: Hiring priorities, growth areas, and strategies to fill open roles (Tech Pro Research)
Geography is becoming less and less important in the early days of a software firm. Many companies are finding success in the Midwest, and similar regions. Cities including Minneapolis, with its low housing costs and high education levels, are also finding themselves playing host to many successful startups.
Every year, the website Inc releases the Inc. 5000 list of the 5000 fastest-growing companies. While many of those companies are based in the Bay Area, a growing number come from elsewhere. This is due to many reasons, especially new technologies empowering collaboration and government incentives making certain cities more appealing.
Business review site G2 Crowd recently scanned the Inc 5000 list to find the fastest growing firms outside of the Bay Area. Here are the top 15 companies they found, their percentage growth, and their revenue.
- AdRizer – 12501% – $16.7M
- PowerInbox – 7534% – $18.9M
- Pax8 – 4393% – $11.0M
- ConvertKit – 4270% – $9.3M
- ClickFunnels – 4232% – $63.9M
- Snaps – 3733% – $5.6M
- Asset Panda – 3552% – $4.4M
- Seller Labs – 2847% – $6.5M
- CoSchedule – 2771% – $4.8M
- OrthoFi – 2618% – $7.3M
- Ventive – 2489% – $2.9M
- G2 Crowd – 2414% – $11.1M
- CampusLogic – 2375% – $8.8M
- Fishermen Labs – 2345% – $6.1M
- Discuss.io – 2212% – $4.4M
The companies above represent states like Idaho, Georgia, Arizona, and others. So, if you’re an entrepreneur looking to make it big, moving to the Bay Area may not be a requirement to fulfill that dream.
The big takeaways for tech leaders:
- New technologies and company cultural shifts have made it easier to work remotely, and allowed software firms to operate more easily outside of the Bay Area.
- Some of the fastest-growing software firms are based in cities outside of the Bay Area, proving that a good product will win out over competitors, regardless of locale.