Mainsail conducted the Bootstrapped Sentiment Survey for the 7th consecutive year at the end of 2017. This year Mainsail surveyed entrepreneurs on the role that geography plays in the success of their company. From the results, we have selected the ten best metropolitan areas in the country to bootstrap a company based on entrepreneur sentiment and third-party census data, such as the cost of living, mean developer salary and population growth.
Hover over the chart to see how each city we assessed ranks and read about our nominees for the best places to bootstrap a company below.
In addition to providing perspective into geography, entrepreneurs also provided insights into the strategies and approach they’ve taken to bootstrap their business. These results will be published in Part II in mid-March.
Affordable talent is Raleigh’s secret weapon, with an average developer salary of $98K (vs. $132K in Seattle), thanks to the nearby Research Triangle of Duke, North Carolina University, and UNC-Chapel Hill. Only 29% of respondents cited finding good hires as a top challenge (vs. 51% overall).
"The Research Triangle Park area is full of colleges and universities for access to tech talent."
Nashville is a smaller and younger market (67% of responding companies were founded since 2010), but a strong one for healthcare software and services. 56% of respondents reported being in healthcare (vs. 20% overall). It’s no surprise, with 18 publicly traded healthcare companies anchoring the ecosystem.
"Nashville is the Healthcare capital of the U.S."
Of the cities we evaluated, Dallas is one of the most affordable to live in, and one of the most convenient to travel from. The median home price in Dallas is the lowest, at $129K (compared to $700K in San Francisco), and respondents noted that its central location makes it easy to work with customers around the country.
"Low cost of living, no income tax, lots of good talent."
The Atlanta companies we surveyed were among the fastest growing, with 50% reporting revenue growth over 40% (vs. 28% overall). They’re also managing to achieve that growth profitably, with 90% reporting breakeven or positive EBITDA (vs. 79% overall).
“Atlanta is becoming a tech hub, with more talent and investors coming in.”
Salt Lake City entrepreneurs have high expectations, with 100% of respondents predicting faster growth and more hiring for their companies in 2018 (vs. 76% and 66% respectively). They also view their location as an asset, with 25% giving the highest possible rating for how much their geography contributes to their success (vs. 7% overall).
“Lots of access to affordable, hard-working talent in a business-friendly environment.”
No other city can quite match Austin’s growth rate, with a 20% surge in population since 2010. Bootstrapped businesses are growing too, with 88% of Austin respondents expecting faster growth in 2018. When asked why their city is a great place to bootstrap, two different respondents replied simply: “It’s Austin!”.
"It's Austin!"
Denver’s economy is humming, giving it one of the lowest unemployment rates in the country at just over 2%. That can mean fewer local candidates for open jobs (64% of Denver respondents said that finding good hires was a top challenge), but it also draws in qualified transplants. Denver boasts one of the highest population growth rates in the country (more than 12% since 2010), and respondents agreed that their businesses benefit from Denver’s desirability.
“Great energy in Denver/Boulder with lots of talented people moving here.”
For the third largest city in the U.S., Chicago is a surprisingly affordable place to grow a business. Respondents noted that Chicago has the benefits of a big city, like strong business community and access to customers, without the cost of living price tag. Chicago entrepreneurs are optimistic about that combination in the coming year; 100% predict faster growth in 2018.
“Chicago has tons of enterprises to sell to. Strong community, easier to build trust.”
Beltway respondents reported benefiting from the strong community of entrepreneurs in their area, and almost half of respondents participated in formal peer mentorship groups for tech leaders or CEOs. That knowledge sharing must be working because D.C. companies were among the most profitable; 94% have positive or break-even EBITDA.
“Excellent quality of life, local entrepreneurial community, and easy access to great growth markets for our offering.”
More than in any other city, Philadelphia bootstrappers are excelling in enterprise sales; 83% have an average deal size over $50K (vs. 35% overall). Their strategy is also a good one for profitability, with 100% of respondents reporting positive EBITDA (vs. 61% overall).
"Lower cost of real estate and great universities."
The survey was conducted between November 15 – December 28, 2017, and resulted in 329 completed responses. This is the seventh annual Mainsail survey and is intended to help us continue to understand the needs and perspectives of companies that Mainsail invests in and helps to grow. The survey was conducted via an online survey sent to entrepreneurs and senior executives at U.S.-based companies.
For the purposes of this survey, “bootstrapped companies” are defined as businesses which have taken no previous capital from venture capital firms, or other institutional investors. Qualification as a bootstrapped company was verified through a qualifying question.
Mainsail Partners is a leading growth equity firm that has raised over $750 in committed capital. Mainsail invests exclusively in profitable and growing software companies in the United States and Canada. We work in partnership with management to build our portfolio companies into market leaders. Our exclusive focus on bootstrapped companies has generated expertise and resources specifically relevant to helping companies like yours grow.