The city of Las Vegas ranked as the nation’s top spot for business startups, climbing eight spots in the latest ranking report by research firm Crowdfund Capital Advisors. Las Vegas moved past cities such as Austin, Texas, Wilmington, Delaware, and Seattle, Washington, on its way to No. 1. Using data from more than 6,000 companies that have raised funds, the firm’s annual rankings are based on factors such as the amount of funds raised, the number of offerings, average valuations, the number of investors and success rates.
Sherwood Neiss, co-founder of Crowdfund Capital Advisors, attributed Las Vegas’s top position to engaged civic leaders, government-sponsored events, tax incentives, training programs and mentorship initiatives for local entrepreneurs. The city’s low-tax status and affordable living costs add to its appeal.
Las Vegas also offers a high standard of living at a lower cost compared to tech hotspots such as the Bay Area, Southern California, Seattle and Austin. Government support, revitalization efforts and various programs have helped facilitate Las Vegas’s rise as a dynamic tech hub.
In 2023, Las Vegas hosted 625 startups, according to Dealroom.co data. These companies employed more than 11,000 people, a 143.7 percent increase in startup employment since 2020. Startups with between 50 and 200 workers employed the majority of workers. In 2022, Las Vegas attracted more than $4 billion in startup investments, with companies in the fintech industry receiving $126 million. Media companies garnered $96.6 million, followed by gaming ($58 million), travel ($44.8 million) and sports ($43 million).
The industries that reported the largest investment growth in 2022 among Las Vegas’s startups were the real estate industry, which increased 3,160 percent, sports (+1,770 percent) and media (+1,223 percent). In terms of total investment, the city ranked below San Francisco, New York and Austin, which attracted $21 billion, $11 billion and $5 billion, respectively.
Las Vegas’ growth as a small business hub has been supported by various accelerators and incubators, including the Downtown Project, Nevada Workforce Connection, UNLV’s Troesh Center for Entrepreneurship and Innovation and StartUpNV. At the state level, a number of programs and initiatives have also helped entrepreneurship, including Nevada’s Small Business Credit Initiative, which provides $10 billion in funding for post-pandemic small businesses, and the Nevada Knowledge Fund, which recruits specialized faculty for innovation. And at the most recent Legislative Session, Nevada became the first state in the nation to pass “Right to Start” legislation, which simplifies the process of starting and growing businesses. Such legislation typically includes measures like establishing dedicated offices or agencies to support entrepreneurs, reducing regulatory hurdles, making access to capital easier and creating more favorable environment for business creation and growth.
The growth in Las Vegas’s startup community aligned with a rapid national business growth trend since the pandemic. On a national level, new business applications climbed significantly in the latter half of 2020 and remained high through mid-2023, resulting in increased job creation. This shift favored smaller, younger firms, raising the prospect of renewed innovation and productivity growth. In Southern Nevada, the business environment was also thriving. As of the first quarter of 2023, the region was home to more than 60,000 private businesses, a 4.6 percent increase from early 2020. While a significant number of employees worked at large companies with more than 1,000 employees, about three-quarters of Southern Nevada business locations employ fewer than 10 people.
The City’s startup companies include six “unicorn” companies that are valued at $1 billion or more and six “future unicorn” companies that are valued between $200 million and $800 million. These include MP Materials, the owner and operator of Mountain Pass, the sole integrated rare earth mining and processing site in North America that launched in 2017 and was valued at $2.6 billion. Data center operator Switch, founded in 2000 with a team of 696 people, was valued at $11 billion as of July 2023. Other notable unicorns encompass Marathon Digital Holdings, Athletic Greens, Sightline Payments, Motional and Opendoor.
With its commitment to entrepreneurship and new business development, Las Vegas is well positioned to maintain its spot as one of the best places to start and grow a new company in the United States.
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