Not Just for Layovers: 10 Off-the-Radar Tech Hubs

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“This article is a joke, isnt it?” an eWEEK reader asked in response to our story, “Beyond the Valley: 10 Blooming U.S. Cities for Tech.” “You didnt mention Austin, Houston or Denver, all home to major players and startups, but you give New Jersey an honorable mention?”

This was just the beginning of the feedback. Comments such as “you guys have no clue” and “this article is misleading garbage” were flung into our e-mail inboxes and across our phone lines. Representatives from chambers of commerce of cities not on the list called us through the morning, eager to tell us where our logic had strayed.

The majority of the responses boiled down to the same concern: Nobody really knows if Silicon Valley could be re-created elsewhere, but there are no shortages of locales boasting potential.

Guy Kawasaki, CEO of Palo Alto, Calif.-based Garage Technology Ventures and an original Apple Computer employee, reminds people that Silicon Valley emerged without having any central strategy.

“There has never been any master plan for the creation of Silicon Valley. What stands before you is an amalgamation of hard work, luck, greed, and serendipity but not planning. Indeed, Silicon Valley has probably worked because there was no plan,” Kawasaki wrote in his blog.

Kawasaki argues that for any town or region to compete against the Valley, it has to go one step further than “beating” it.

“Aim higher than merely trying to re-create Silicon Valley. You should try to kick our butt instead. Thats true entrepreneurship.”

In this report, we round up cities that few may have anticipated five or 10 years ago would sustain thriving tech markets. Each is carving out a unique niche for itself, and all have the potential to hone the right combination of ingredients for the next tech epicenter.

Best of all, this is great news for IT professionals, who no longer have to pack up their families and move to a tech hub to find the best opportunities for career advancement—most already live in one.

Next Page: 10 emerging tech markets.

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1. Austin, Texas •City population: 690,252 •Companies that call it home: Dell, WidowPC, Vignette •The details: Paul Graham, in his essay about how to be the next Silicon Valley, applauded Austin for yielding a high-tech community from its top computer science department at the University of Texas at Austin. Meanwhile, in May, Hewlett-Packard announced that it would build two data centers in Austin, where data centers for Dell, Oracle, Sun Microsystems and Home Depot are housed already. In April, Samsung announced plans to build a $220M semiconductor plant in Austin, bringing at least 1,000 jobs to the area.
2. Denver and Boulder, Colo. •Combined population: 676,628 •Companies that call it home: Qwest, Ciber, Intrado, Webroot •The details: The Denver metropolitan area, which includes Boulder, has long been known for its vibrant high-tech scene, with approximately 3,700 software companies. The American Electronics Association, in its Cyberstates annual survey, has ranked Colorado ranked first in concentration of tech workers for the past six years, with 89 of every 1,000 private-sector workers in high-tech. Indeed.com ranks Denver No. 15 in number of tech jobs per capita, with 8 jobs per 1,000 people. IBM, while based in New York, is Colorados largest tech employer, with 4,500 employees and a payroll of more than $360 million in Boulder alone.
3. Sacramento, Calif. •City population: 456,441 •Companies that call it home: Unify, Synectic, Hansen •The details: Indeed.com ranks Sacramento No. 20 in number of available tech jobs per capita, with 7 per 1,000 people. In its “California Cybercities 2006” study, the AeA found that Greater Sacramento added more tech jobs than any other California city in 2004. Inc. magazine, in its Boomtowns 06 report, listed Sacramento as the No. 1 U.S. place to do business.
4. Salt Lake City •City population: 181,743 •Companies that call it home: iBahn, LANDesk, Burton Group •The details: Inc. Magazine writes, “Utah has become the epicenter of the Inc. 500 Fastest-Growing Private Companies in recent years.” According to the Utah Department of Workforce Services, Utahs IT industry grew more than 13 percent with 2,984 companies in 2005. ACCRAs Cost of Living Index ranked Salt Lake City 92.5 compared with 156 for San Jose, Calif., in 2005.
5. Raleigh, N.C. •City population: 276,093 •Companies that call it home: Red Hat, Siemens Power Transmission & Distribution •The details: Considered part of the “Research Triangle,” which includes Durham and Chapel Hill, Raleigh was ranked in the Top 10 cities for creative class talent by Fast Company magazine in 2005. Lenovo maintains its principal operations in Raleigh. NPRC Press, a division of the National Policy Research Council, ranked Raleigh-Durham third on its list of the best large metro areas for new businesses and entrepreneurs in October 2005.
6. Portland, Ore. •City population: 556,370 •Companies that call it home: Pixelworks, Tektronix, Electro Scientific Industries •The details: You cant talk about Portland without talking about Linux, namely because Linux founder Linus Torvalds works there. Indeed.com ranks Portland No. 19 in number of tech jobs per capita, with 7 jobs per 1,000 people. Paul Graham felt that Portland had the right combination of geeks and money to become the next Silicon Valley.
7. Milwaukee •City population: 583,624 •Companies that call it home: Metavante, Miles Data, Alien, Open Ratings •The details: Merge Healthcare was ranked No. 1 for hiring among the fastest-growing techs by Business 2.0 magazine, with a 185 percent change in headcount in 2005. Indeed.com ranked Milwaukee No. 11 in number of available tech jobs per capita, with 9 jobs per 1,000 people.
8. Phoenix •City population: 1,418,041 •Companies that call it home: Avnet, Insight Enterprises, On Semiconductor, Microchip Technology •The details: Arizona is home to nearly 111,000 high-tech workers, ranking the state at No. 18 among all states, according to the AeAs Cyberstates report. In terms of semiconductor jobs, Arizona ranked fourth with 22,500 industry employees. Entrepreneur Magazine called the Phoenix/Mesa metro area the No. 1 “Hot City” for entrepreneurs, based on its growth of new businesses.
9. Houston •City population: 2,016,582 •Companies that call it home: BMC Software, Universal Computer Systems, Landmark Graphics •The details: Rated No. 3 of 10 by Forbes Magazine on its Best Places for Business and Careers list. Hewlett-Packard employs more people in its Houston operations than any other HP facility in the world.
10. Richmond, Va. •City population: 333,040 •Companies that call it home: Circuit City, Amentra, AMC Technology •The details: A growing center of biotechnology, in 2005 Forbes ranked the Richmond area as the No. 14 Best Place for Business and Careers, primarily due to its highly educated labor force and relatively low business costs. Indeed.com ranks Richmond No. 6 in number of tech jobs per capita, with 11 jobs per 1,000 people.

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