The business outlook for entrepreneurs has never looked brighter. Thanks to more intelligent technology, startups are creating millionaires out of enterprising individuals both young and old and it seems that Los Angeles and Orange County are proving to be some of the most important locales for this activity.
According to the nonprofit Ewing Marion Kauffman Foundation, which recently did a study on the most active areas in the nation for startups, the Los Angeles – Orange County area is the fourth most active for startup businesses. Two driving factors behind this strong placement on the list is the area’s recent influx of capital and business-to-business mentorship, which is helping today’s brilliant minds turn their ideas into lucrative and long-sustaining businesses.
“That’s probably about right. It seems like we really are a hotbed of startup activity the last couple of years,” said Gene Alexander, director of technology entrepreneurship at Chapman University’s Leatherby Center Student Incubator and director of the school’s Launch Labs, to The Orange County Register.
The only portion of the study that showed any lacking potential for the Los Angeles – Orange County region was the percentage of businesses who were founded by creators who left other jobs. According to the study only 72 percent of startup founders left their previous jobs to create their new business, which was well below the level of all five other populous California regions that made the list.
This is particularly surprising because many startup founders find the impetus to create a new business out of a great idea or spark of genius. Much fewer do so out of necessity due to unemployment. The study reported a high percentage of startup founders who were unemployed prior to creating their businesses.
Despite the mixed results, the Los Angeles – Orange County region was still able to finish strong and showcase the region’s resolve to create a fostering environment for young and innovative businesses.
California Remains Hottest State for Startups
Other top performers on the list were Miami and Austin, Texas, which took the first and seconds spots respectively. Surprisingly, areas that have been most associated with innovative technology and startups, Silicon Valley and San Francisco both fell in rankings. The Silicon Valley – San Jose metro area fell from it’s number one ranking to the third slot while San Francisco landed in sixth.
Despite a little more widespread distribution of areas in the top spots, California managed to have the most regions in the top 10 and was a strong presence. In addition to Los Angeles – Orange County, Silicon Valley and San Francisco, the Inland Empire also has a respectable amount of startup activity which landed it at 18th.
With all its fluctuations and juxtapositions, the Ewing Marion Kauffman study ultimately underscores a strengthening economy after a serious crisis. As more young businesses are able to stay afloat, more opportunities are being made for workers and a better outlook is being seen for the future of home owners throughout Southern California and the rest of the nation.
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