In 2016, Austin, Texas was named by CNBC as the number one place in America to start a business. While starting a business in a location such as Silicon Valley typically relies on individual entrepreneurs, venture capital, and large risks, Austin has taken this formula and turned it into a neighborhood activity. Largely inspired by Austin’s strong sense of community driven in part by its music and entertainment scene, business owners and entrepreneurs in this city take the time to help each other succeed, promoting cooperation between businesses. Take, for example, the Small Business Festival that took place in Austin last May, which attracted 70 speakers and nearly 1,200 participants. The American City Business Journal uses 16 different factors to measure how friendly a city is to small businesses, and Austin’s success becomes apparent when looking at these factors. For instance, from 2010 to 2013, the number of small businesses in Austin grew by nearly 10%, and in 2012, 35% of local private-sector employment came through these same businesses.
As larger companies cut jobs, small businesses continue to employ people in ever-higher numbers, creating 8 million new jobs since 1990 versus 4 million lost at larger corporations. The Small Business Association reports that there are 28 million small businesses in the United States, accounting for 66% of all new jobs and 54% of all sales in the country. Mirroring this success, Austin’s strong small business economy demonstrates the ability of small businesses located in inner cities to achieve stellar revenue growth when they pair strong leadership and a cohesive vision with access to investors and other resources.
ICIC’s Inner City 100 list contains its own fair share of Austin businesses, showing the area’s fast-growth potential. 10 businesses have been featured on the Inner City 100 list in its 19-year history, and all show impressive revenues and growth rates. In 2015, OriGen Biomedical, a manufacturer specializing in medical devices, was ranked #65 on the IC100 list with a growth rate of 137.52%. Most recently, OriGen was named by Inc. Magazine as one of the 5,000 fastest-growing privately-held businesses for the sixth year in a row. PetRelocation.com, a business providing pet transport services both domestically and internationally, was featured in 2013, 2014, and again in 2015 with a 101% five-year growth rate. Another IC100 winner from 2010 through 2014, Aztec Promotional Group, a promotional and apparel manufacturer specialized in branding, was started in a dorm room at the University of Texas in 1995 and is certified as a Woman Owned Small Business (WOSB) by the U.S. Small Business Administration. Aztec’s five-year growth rate in 2014 was 96.6%, and it had revenues of over $3.5 million. Another Austin small-business star, Home Trends & Design, was started in 2005 as an eco-friendly furniture manufacturer, making furniture entirely out of wood for wholesale and storefront sales. Aside from being the founding member of the Sustainable Furnishings Council, they were featured in 2016 on the IC100 List with a five-year growth rate of 186.48% and 2015 revenues of $19.93 million.
Austin’s commitment to creating a sense of community around its inner city small businesses is reflected in its continual success in rankings as a great city for entrepreneurship. Business owners helping each other obtain the resources and expertise they need is a page out of ICIC’s playbook for strong business growth; businesses can and will succeed when barriers to business knowledge and capital are overcome. A community-based small business ecosystem is what’s helping Austin grow its economy through employing local people and creating thriving industries.