Techie.com’s Ten Most Unexpected Cities for High-Tech Innovation
There are a handful of cities we think of, when we think of high-tech innovation and startups: San Francisco, New York, London, Bangalore, Tel Aviv . . . but today, high-tech development has been democratized. Easy and cheap availability of cloud-based resources, sophisticated telecommunications tools, platforms-as-a-service and lean models that accelerate the development and deployment process, and – sorry, California – a net outmigration from traditional tech centers, has already started to shift high-tech development to the most unlikely places.
It’s a fact: You no longer have to be in Silicon Valley to run a successful Internet company. But where will tomorrow’s dotcom boom come from? This may be the Rust Belt’s year to shine. We asked innovators, entrepreneurs, and city leaders this question: “What are the most unexpected cities that are leading the high-tech revolution”?
Chattanooga started luring techies to the city aggressively in 2012. Sponsored by the Lyndhurst Foundation and administered by Chattanooga Neighborhood Enterprise, the Geek Move program offers a $10,000 forgivable mortgage and $1,250 for relocation expenses. Eligible, “professional geeks” must live 50 miles outside of the region and purchase a home within one of 10 neighborhoods in the city.
Among other amenities, the city offers high-speed Internet service of up to one gigabit/second. This is 200 times faster than the average broadband speed in America. Only a few other cities in the world offer this speed of service, and Chattanooga is the first in the United States. The effort is the byproduct of an aggressive high-tech economic development plan in recent years, boosted by funds from the federal economic stimulus program. The highest-speed service costs $350/month.
Another selling point for techies is the Titan supercomputer at Oak Ridge National Laboratory, which was named the fastest computer on Earth in 2012. Titan has a peak performance of more than 27 petaflops, or 27 thousand trillion calculations per second. It can do more work in one hour than a personal computer can do in 20 years. Additionally, the machine is five-times more energy efficient than its predecessor, when running compute-intensive, large-scale scientific research. Perhaps most importantly, the machine possesses potentially world-changing applications. The supercomputer allows the laboratory to simulate what goes on in the climate, what goes on in building engines, and what goes on in nuclear reactors.
» Chris McKim
Cincinnati has been recognized as an increasingly innovative city, though its growth in the technology sector has been largely overlooked. In 2011, Bloomberg Businessweek listed Cincinnati as the No. 3 city in the country with the biggest growth in tech jobs (a gain of 65%). Booming businesses in India, such as Tata Consultancy Services (TCS) have chosen to make Cincinnati their home. This company is amongst the most respected of brands and chose the city of Cincinnati to establish its first US branch of the company, enticed by the low cost of conducting business and the client prospects, among other things.
Former Governor of Ohio, Ted Strickland, adds, “(TCS’s) investment brings promise to our state’s economy by advancing the jobs and services that will carry us into the future.” The number one bank, Citigroup, the number one wealth management firm, Fidelity, the number one grocery store chain, Kroger, the number one general and consumer goods company, Proctor & Gamble, the number one automotive company, Toyota, and the number one manufacturing company, AK Steel, call Cincinnati home, so its easy to see that the groundwork is here for great technological growth.
Toyota is one of Cincinnati’s largest employers, according to statistics compiled by city-data.com. Toyota chose the greater Cincinnati area for its North American manufacturing plant. “The area has an excellent transportation system, a world-class airport, an excellent quality of life and a positive business climate,” said Dennis C. Cuneo, Toyota’s Senior Vice President of Corporate Affairs, regarding the company’s choice to build in Cincinnati.
What makes this choice an unexpected one is because the industry is in the rugged Midwest. In actuality, this city is in the heart of the Midwest. It is central to major cities in Ohio, Indiana, and Kentucky. It acts as a center and connecting point for cities like Chicago, Nashville, Pittsburgh, and even Charlotte.
» Rodney Smith
When considering some of the counter intuitive, or otherwise surprising nominations for unexpected tech cities of innovation, Des Moines certainly fit the description. Upon mention, many imagine a popular perception of rich farmland. However, the city offers several business incubators, a wide range of notable start-ups and a prime environment for young professionals.
“Des Moines is proving that Iowa is fertile ground for more than just crops,” said Ini Augustine, CEO of SocialWise Media Group, a Des Moines-based marketing firm that works with small businesses. “We have had several startups of note, such as Dwolla, an online payment network that allows anyone to send, request and accept money, which Ashton Kutcher invested in. Tikly is also dominating, taking market shares from established companies like Ticketmaster. They were also featured on Bloomberg for launching the first integrated Facebook/ticket purchasing app. The thing that strikes me the most is that established businesses, academia, and non-profits coordinate together to reach entrepreneurs at all stages of development.”
Last year Forbes ranked Des Moines number one on the list of Best Cities For Young Professionals. The city is home to a number of business incubators that are cultivating new tech growth, such as the Iowa Startup Alliance, Startup City, Foundry Co-working, and the West Des Moines Startup Incubator.
With business costs 16% below the national average, Des Moines has been attracting young, scrappy technology startups and companies relocating from the coasts. Additionally, a number of established companies in the area are expanding. As a result, Des Moines boasts a low unemployment rate and healthy projected growth rates.
» Chris McKim
In 2012, a blogger for TechCrunch challenged Detroit, aka The Motor City, aka Motown, to rebrand itself as a tech hub, citing the ample amount of open (albeit dilapidated) office space and low cost of living, which makes it a seemingly prime location for cultivating cloud-based tech companies, and, as a Detroiter, I say, “Bring it.”
Of course, what the well-intentioned blogger fails to see is the amount of challenges the city faces from politics to corruption, the looming bankruptcy issue, and a number of poor management decisions over the course of 30 odd years that are catching up to the city day by day.
Detroiters are used to being misunderstood. Incidentally, Detroit is also known as one of the birthplaces of techno music, has a world-class jazz scene, and is consistently known for innovation.
In 2013, Detroit became the only two-time winner on the top five list of fastest growing tech cities, according to Dice.com, a New York City tech job site. The city was No. 1 on the list in 2011 and came in fifth on the list in 2013, with year-over-year growth of 10 percent in tech job listings. Automation Alley, Michigan’s largest technology association, ranked the greater Detroit region among the best for its strong record of students completing science, technology, engineering and math (STEM) degrees, Dice noted in 2011.
In 2013, annual salaries for Detroit-based tech pros rose at above average rates, up seven percent from 2012 to $76,515 on average, putting it closer to the national average for tech jobs and making it a more competitive overall contender in the tech marketplace.
The auto makers started looking for experts in cloud computing, mobile software applications, and energy management to replace car stereos with Internet radio and gasoline engines with motors powered by lithium-ion batteries when the trend began.
Now, the city embraces a Silicon valley-esque startup culture, where CEOs wear jeans and the company walls are tagged with graffiti, a far cry from the corporate culture my father worked in at Ford Motor Co for 30 years, and just the thing to attract companies like MOG, Inc., a Berkeley-based company that specializes in streaming radio, that set up an office in Detroit a few years ago.
The U.S. patent office also moved to Detroit in 2012 because of the region’s high percentage of scientists and engineers, as well as its patent output (4,000 patents were granted to Michigan in 2010, making it seventh among U.S. states), according to Paul Fucito, a patent office spokesman.
Some other tech standouts include www.techtowndetroit.org and
www.detroitventurepartners.com. Business incubators, accelerators, and venture capitalists are infusing a great deal of money into the development of high-tech companies that will stay invested in the city.
» Sharon Emeigh
Though the expression, “What happens in Vegas, stays in Vegas”, should be reserved for something special, business startups in Vegas do not fit into this category. The entertainment industry tends to overshadow the tech start-up scene, which has gained a foothold in recent years with the success of startups, such as Zappos.com, which has exploded into a $1.2 billion dollar business in recent years. Tony Hsieh, CEO of Zappos, created a business model that is allowing the online retailer to expand in many different directions under the Zappos Family umbrella, including the cultivation of a community of tech startups along with a handful of other passionate investors, The Vegas Tech Fund.
The Vegas Tech Fund is a tech incubator that has enabled several startups to succeed by creating a collaborative business community conducive to developing unique services. Zirtual is a distinctive startup venture backed by the Vegas Tech Fund. Zirtual is a virtual assistant service that pairs a busy person with a personal ZA (“Zirtual Assistant”), who handles event coordination and planning for them. TicketCake.com is another great example of a Vegas startup. It’s a platform for buying and selling tickets to various special events and concerts that is essentially a better version of Ticketmaster or Live Nation.
» Nick Epson
A five-year-old prediction proves correct as Milwaukee retains and even surpasses its ranking on Forbes’ list of top 10 Up-and-Coming Tech Cities by landing itself on techie.com’s unexpected tech cities list. Milwaukee boasts more than just brewing and drinking culture in Wisconsin suburbia. The city hosts one third of Wisconsin’s technology industry. It is used to being a utopia for technologies pertaining to manufacturing; however, Covenant Healthcare Systems is working with some state-of-the-art technologies that are diversifying Milwaukee’s technology presence in the country.
People generally don’t expect much booming technology from a city such as Milwaukee because many experts claim manufacturing and industrial focused jobs to be obsolete or on the way out. In many ways, this is true. South Bend, IN, for instance used to boast the Studebaker plant, and that has since gone under and some people still cling to the past views, as in clinging on to an industry that has used up its potential. Milwaukee, on the other hand, has maintained a strong presence in the manufacturing industry by partnering it with high tech facets.
Quad/Graphics and Wisconsin Energy are booming, and can thank the talents of the Milwaukee schools and residents who benefit from that education for its unexpected, yet much deserved ranking in techie.com’s Top 10 Most Unexpected Cities for High Tech Growth.
» Rodney Smith
Everybody loves a comeback, and New Orleans represents an unmatched variation of this ideal. While an infamous disaster may forever be associated with the city in the minds of people everywhere, the city has emerged as a great destination for tech entrepreneurs.
“The rebirth of our city has brought with it a new goal: To Become the world’s greatest destination for tech entrepreneurs,” said Flynn Zaiger, CEO of Online Optimism, a New Orleans-based digital marketing agency that specializes in working with young entrepreneurs. “We have everything you need: World-class universities, tax-incentives for digital media production, and a growing scene dedicated to helping entrepreneurs, hackers, and startups thrive.”
Ultimately the Katrina disaster triggered a large influx of people who wanted to help rebuild. Because of this, companies like Idea Village, a non-profit that supports local entrepreneurs, gained some traction. The rebuilding process allowed Idea Village to introduce Entrepreneur Week, a full-blown week of events, including workshops taught by local business leaders as well as by executives from Google, Salesforce.com, and Cisco.
The New Orleans BioInnovation Center is dedicated to innovating and developing sophistications in life science technologies. The Center‘s team develops programming and applications for promoting and realizing ideas that will improve the quality of life for millions.
The Center resides in a community of hospitals, medical universities, research centers, and biotech businesses. The location itself provides the infrastructure necessary to support the day-to-day functions of dozens of businesses and is designed to nurture a close network of the region‘s leading researchers and innovators within the life science community.
» Chris McKim
As the largest city in Maine, the greater Portland area harbors about a third of the state’s total population. Ship stocked seaports, iconic lighthouses shrouded in fog, and historic New England architecture are the typical things Maine calls to mind. However, cities like Portland are working hard to create a new image for the state of Maine as a place known for high tech innovation.
The Top Gun Accelerated Entrepreneurship Program, part of the Maine Center for Entrepreneurial Development, is one of several efforts that are succeeding in developing technology-based entrepreneurs in the community. Top Gun is a three-tiered program (Top Gun Prep, Top Gun, and Top Gun Next) that provides participants with curriculum, mentors, and services to develop skills and empower entrepreneurs to succeed at growing their business in Maine. More than 50% of the businesses to graduate from the Top Gun program are technology based, according to the Maine Center for Entrepreneurial Development.
At the Casco Bay Technology Hub (CBTH), no one pays dues, but all of the dozen or so businesses that share space in the CBTH building do so with a pledge to J.B. Brown, landlord and partner in CBTH, that their business will stay focused on building a technology hub in Maine, growing startups in the community, and staying in the community. The businesses at CBTH are working toward their shared goals by building partnerships with other groups in the community that are focused on improving the quality of life in Portland, Maine, such as educational institutions, government entities and funding sources, such as the Maine Technology Institute, Maine Angels, and the Small Enterprise Growth Fund.
» Nick Epson
“While Kodak seemingly put Rochester on the map, it’s the talent that remains there that makes it one of the most unexpected cities for high-tech innovation,” said Mark Lucas, Co-founder and VP of Sales for Sudo, a Rochester-based company that has developed an app for consolidating deals, coupons, and savings. “Young fresh minds from the University of Rochester (UR) and the Rochester Institute of Technology (RIT) are sticking around post-graduation to finish what they started.”
Roughly half a billion dollars worth of research is conducted annually at RIT and UR. A portion of the healthy $749,994 grant from the National Science Foundation’s Robert Noyce Scholarship Program awarded to UR in 2012 is allocated to addressing the shortage of highly qualified math and science teachers in the area by providing full-tuition scholarships to undergraduates pursuing these educational careers.
Cerion Energy is a producer of a nanotechnology-based diesel fuel additive that decreases fuel consumption and emissions. EnergyHarvesters.com created the Walking Charger, a device embedded in footwear that charges mobile devices on the go.
Aquavation.org created a 3D software app and digital press for complete customization of unique water bottles. LocalizedTherapeutics.com is developing laser-controlled gene switches for gene therapy drugs. Innovocracy.com connects supporters of academic research with on-campus innovators.
With 65,650 techies in the workforce, Rochester rivals San Francisco and San Diego and was recently ranked 5th for patents per capita by Forbes. Rochester is successful in harnessing tech-savvy appeal into a defining characteristic.
» Chris McKim
Once a flourishing manufacturing town and home of Studebaker, the old auto manufacturing section of south downtown is now home to an emerging high-tech Renaissance. This region now boasts a new high-tech industrial park called “Ignition Park”; a high-speed dark fiber ring; and a major colocation and “Big Data” facility. And, of course, this same district is where techie.com calls home.
From the commercialization efforts coming out of University of Notre Dame’s Innovation Park, to the presence of dynamic events like Start-Up Weekend, South Bend is a midsize city that is attracting attention from the tech world typically reserved for larger destinations.
South Bend has been preparing itself for the information age since before anybody knew what was coming. In the days when Studebaker was the dominant employer in this city, manufacturers flocked to South Bend because of its convenient location as a shipping crossroads, along with an enhanced power infrastructure and low costs. Today, South Bend, sitting at the center of six national fiber routes, is at the center of the information superhighway.
Rich Carlton, President and COO of Ignition Park’s anchor tenant Data Realty, says the biggest factors in building a major tech hub are looking for the highest quality and lowest price. Factors include the cost of building infrastructure, the cost of power and fiber, and the cost of ongoing management, and South Bend wins hands-down on all fronts. Carlton said, “As more things go to the cloud, you can go anywhere. So if we can be anywhere, why not here?”
Data Realty chose South Bend over several other markets, and is leading the way in making South Bend the “big data” capital of the world. More than a state-of-the-art colocation facility, Data Realty answers the question, “Once you store your data, what do you do with it?”
“We think we can make South Bend one of the data analytics capitals of the world,” said Carlton. Data Realty, as a “big data” leader, is expected to attract many other tech startups eager to enter the dynamic big data analytics market.
» Dan Blacharski