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STARTUP

Why Raleigh Will Be the Next Startup Hub

The Research Triangle has the talent, space and drive to house your business.

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BY Jeff Barrett - 25 Jun 2018

Why Raleigh Will Be the Next Startup Hub

PHOTO CREDIT: Getty Images

Before last month I had never been to Raleigh, North Carolina. I knew the bare minimum about the region.

UNC, Duke, and NC State, which make up the Research Triangle, are all in an hour radius providing top-level talent. Almost every big company has an office in Raleigh.

This finalist for Amazon's HQ2 isn't a cute up-and-comer anymore, but the next logical city to become a destination -- just like Austin, Denver, and Portland have over the last decade.

Raleigh has the space, the expertise, the best train station (Raleigh Union Station) I have ever seen, and more available talent than any other city on Amazon's list. Plus, it's home to Brewery Bhavana, one of Bon Appetit's 10 Best New Restaurants in America. It's a flower shop and bookstore by day. Dim sum brewery by night. It's incredible.

And I didn't even have to bring up cost of living to make that case. Sure, it's cheaper, relatively, to live and work in Raleigh than in other locations. But unlike a lot of cities, it doesn't need to make that its main selling point. It has its own.

The Campus

NC State's Centennial Campus, just west of downtown, looks and feels like Silicon Valley. The Hunt Library is stunning. More importantly, this campus is one-third residential so that Raleigh can always manage for growth and future potential traffic issues with fewer long commutes.

The NSA has offices in this campus. Bandwidth, a publicly traded company that supplies voice and messaging tools for Google, Skype, and Athena, is also on campus.

Another company, Republic Wireless, is launching a new cellular walkie-talkie called Relay for kids and parents. "Being in Raleigh actually gives us an advantage, given how family-centric this area is and how many young children there are here," said Chris Chuang, co-founder and CEO. "Our 'market test lab' is literally all around us."

This access to large companies, talented students, and residential living -- all in one place, five minutes from downtown -- propels growth for the region.

Not to mention, NC State's entrepreneurship programs "provide an early pipeline for students to grow their ideas," said Leah Burton, director of the university's Centennial Campus Partnerships and Industry Alliances. "Our partnerships with both early-stage and global companies enable the creation of new products, companies and jobs."

The entrepreneurial network

Co-working space HQ Raleigh has jumped in to fill the need for an entrepreneurial network and in the process is changing how we should look at community co-working. Instead of a central hub, it has five different locations, each with a different aesthetic and purpose that both fosters diversity and a larger network.

"Putting an idea into action and scaling up a business is really hard. But it's a heck of a lot easier if you have a supportive community, access to some of the best talent in the country, and a relatively low cost of living -- evidenced by the more than 200 companies we have in the HQ Raleigh community alone," said co-founder Christopher Gergen, who also runs Forward Cities, a national network of cities committed to inclusive innovation.

Raleigh is also home to the team behind Burt's Bees, Seventh Generation, and Leesa Sleep. One Better Ventures, a venture capital firm, is also located in HQ Raleigh.

Raleigh's biggest startup, Red Hat, has turned into an 11,000-employee giant in open-source software for enterprise. The first floor of its downtown skyscraper is becoming Red Hat Open Studio -- a place where design-minded associates will showcase work and collaborate with the community.

In terms of getting around, Citrix has recently sponsored a city-wide bike share program. "We recognized the role of strong partnerships and collaboration in Raleigh, and a willingness to work together as a match to our values and our culture," said Ashton Smith, community engagement manager at Citrix.

The collective spirit

It's part of a collective sense of purpose in Raleigh. Nothing exists in a vacuum. For instance, as the city determines how to renovate Dorothea Dix Park, it will leave the process open to the entire community for input. Located between downtown and NC State's Centennial Campus, the park is larger than both Chicago's Millennium Park and Boston Common with sprawling views of Raleigh's skyline.

The success of recent startups like Bandwidth and Pendo should create more success and even greater access to venture capital. "I'm super excited about our leaders here who have taken risks over these 19 years," said David Morken, CEO of Bandwidth. "They are going to take risk capital of their own and go for it. l most excited about what I expect to spawn out of Bandwidth."

Todd Olson, CEO and co-founder of Pendo, said: "When securing investment here was hard, we expanded our bounds and relationships on the West Coast. From the start, we never thought of Pendo as a Raleigh company. We are a global company that happens to be headquartered here."

Behind the scenes, much planning is going on. Kris Larson who ran the downtown resurgence of my hometown, Grand Rapids, Michigan, is now in the same role back in his hometown of Raleigh.

"There are so many big moves on the horizon for Downtown Raleigh -- high speed transit, bike share, a signature game-changing open space and grocery stores -- items that have been on our wish lists for years will soon become a reality," said Larson.

Raleigh has been often viewed as a great place to relocate. Much like Silicon Valley, there are opportunities everywhere. But savvy entrepreneurs will step in to Raleigh and see all the elements for creating the next big startup hub, a community that wants winners and will help them succeed.

Jon Hayes left Wall Street a couple years ago to create the travel app, RewardStock, in Raleigh. "I knew the environment offered a high quality of living with low costs," he said. "What I didn't know was that there was such a vibrant startup scene, including a robust community of companies, incubators, advisors, and talent."

I didn't know that either, but after three days in Raleigh it was impossible to ignore.

 

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