While location does not necessarily have to influence the success of a startup, it can surely help. Why do you think most entrepreneurs are opening new companies in places that already have a reputation of business hubs, like Silicon Valley, London and Seattle. But as these places become saturated, founders and investors are trying to determine which locations have the potential to emerge as full-blown startup ecosystems.
First of all, let's find out what makes a location good for business. "The things that attracts young people the most is other young people. They would be petrified of Cleveland. But if you are moving with 10 of your friends and there are already 25 there it makes more sense. We are creating a cohort, a community. We see them visiting each other in our other cities," says Andrew Yang, founder of Venture for America. For aspiring entrepreneurs, here's a list of the best cities that have the potential to become at least something close to the next Silicon Valley:
1. Pittsburgh, Pennsylvania
It's home to Google, Uber and Amazon among other big companies as well as to some renowned universities and talented workforce.
2. Indianapolis, Indiana
Salesforce has an office in the city, which is also home to Purdue University, which trained one out of every 50 engineers in the U.S. Indianapolis is also considered the 4th best city for women in tech and has the 3rd largest population of foreign students in the nation.
3. Providence, Rhode Island
The state has lured GE Digital, Johnson & Johnson, Virgin and a Cambridge Innovation Center last year and sponsors college tuition incentive programs meant to draw in new talent and existing talent from institutions like Brown and Harvard.
4. Columbus, Ohio
It's home to The Ohio State University, five Fotune 500 companies as well as several major players in the health care industry, such as CoverMyMeds, CrossChx and Cardinal Health. Not to mention that office space in the city is 60 percent cheaper than New York City.
5. Charleston, South Carolina
More than 250 tech companies have offices in Charleston, which ranks 11th in the U.S. for high-tech industry output and the fastest-growing mid-sized metro for IT. It also attracts about 12,700 new people per year, of which two-thirds are educated individuals aged between 18 and 44 years.
6. Chiang Mai, Thailand
It ranked 2nd after Charleston on Travel + Leisure's list of the world's best cities and is "the top destination for digital nomads" partly because you can live with less than $500 per month in it.