For many years, entrepreneurs and engineers looking to begin their startups all flocked to one place: the infamous Silicon Valley in Northern California’s Bay Area. But as more companies and startups are moving, or even founding, their business in the greater Los Angeles area, Silicon Beach is quickly establishing itself as the tech scene to watch.

Below, we’ve outlined some of the key differentiators that are positioning Silicon Beach to overthrow Silicon Valley’s reign as the top startup hub in the nation:

1. We’ve rolled out our welcome mat, and the venture capitalists are cashing in.

While Silicon Valley is closing doors and capping construction of new office space, LA is opening its arms and incentivizing tech companies to do business in LA.

Eric Garcetti, the Mayor of Los Angeles, began pushing for investment in LA tech companies back in 2013, when he launched the Great Business Program, which gives Los Angeles business owners economic assistance to encourage their growth. A year ago, LA opened the new LA Kretz Innovation Campus, a 60,000 square-foot, $47 million dollar accelerator for startups in the cleantech sector.

(Photo by laincubator.org)

Venture capital firms, incubators, and accelerators like Karlin, Amplify, and Idealab, among many others, are upping investments in Silicon Beach-based startups. Even some of the most well known stars on Hollywood’s A-list are betting big on Silicon Beach, with Will Smith, Ashton Kutcher, Kobe Bryant, Jessica Alba, and Jared Leto attached to companies like LegalZoom, Tuition.io, and The Honest Co. Between 2014 and 2015, Companies in LA were able to raise funding for their startups by 40%, pulling in $4.5 billion.

2. LA’s Entrepreneurial Energy.

It’s undeniable that there’s a magical energy in the air in LA. In 2016, we were ranked as the #3 most active city in the entire nation for entrepreneurs, surpassing San Jose and San Francisco in just one year’s time.

3. The great talent migration.

Top talent are experiencing burnout in response to the current culture in Silicon Valley, and Silicon Beach still has a supportive startup community that Silicon Valley has lost over the years. As Silicon Beach based companies like Snapchat and Tesla achieve success, the demand for engineers and top talent also increases, establishing Silicon Beach as a candidate’s market. And while market salaries are increasing at a more rapid pace than in Silicon Valley, it is still a great alternative to the Bay Area for employers because employee salaries and turnover are much lower here in LA.

4. The companies are coming too.

Startup and tech juggernauts like Snapchat, Space X, Dollar Shave Club, and MeUndies founded their businesses here in LA, and even more are making the trek from northern California to open new offices in Playa Vista, Santa Monica, and other LA neighborhoods. We’ve already welcomed Google, Uber, Hulu, YouTube, Facebook, and Netflix to the LA fam.

5. The rent isn’t too damn high.

One of the numerous advantages of living in LA rather than Silicon Valley is the dramatically lower cost of living. Rent for an extremely modest apartment (read: repurposed walk-in closet) in Silicon Valley can run you anywhere between $2,500 to $3,500 per month. Here in LA, it’s still possible to live within 5 miles of your Silicon Beach headquarters and come in under $2K/month, leaving you more money to spend enjoying that sunny Southern California lifestyle we’re famous around the world for.

Forecasting the future…

Only time will tell if Silicon Beach will overtake Silicon Valley as the startup capital of the United States. Judging from Snapchat’s recent IPO of $33 billion, and the fact that we’ve already surpassed Silicon Valley and New York as the #1 High Technology hub in the nation, we’d say LA is in an ideal position to continue its rapid growth.

If you are in the process of launching your startup here in Silicon Beach and would like to learn more about developing your brand within this highly competitive market, we’d love to share some of our insider knowledge. We’ve been in Santa Monica since 2010, and we’ve helped startups from various industries come to market and achieve incredible growth.

Reach out to us at hello@herman-scheer.com!