We’re no longer constrained by location when it comes to setting up a new business. With today’s millennials getting the entrepreneurial bug in greater numbers than ever before, many are looking further afield when they decide where to set up their base.
While it’s much easier to set up a business, for many people finding the location that offers a good standard of living and plenty of support for their new venture is vital.
Now comparison website Go Compare have collected all the important data to find out which places around the world are more entrepreneur-friendly than others.
And it might surprise you to discover that Tallinn in Estonia is a much better option than many North American cities.
The fact that millennials are prepared to look further afield when setting up their businesses comes down to a couple of factors. First, in many traditional cities, particularly those with a tech start-up history, the cost of living is often high.
Second, millennials have more of a global focus than the generations that came before them and it’s no wonder that setting down roots in a new location isn’t necessarily a big hurdle to overcome.
The Go Compare team looked at a number of factors that contribute to new start-up success, including how easy it is to trade across borders, the cost of setting up a business and the financial support that’s on offer.
Tallinn is the Best City for Start-Ups
The surprise winner, once the data had been analyzed, was Tallinn, a city in Estonia that hardly anyone had heard of.
What makes it such an excellent choice?
With a young, digitally literate population, there’s plenty of key talent to choose from. The city also scores highly on most of the metrics Go Compare looked at. It’s easy to start a business, and there aren’t as many regulations in place to get in the way of growth and development.
Registering a property and getting credit or financing for your business is also a lot simpler than in many other places around the globe. Estonia has a pretty reasonable cost of living index too which means it’s cheaper than places like London and New York by a big margin.
Canada is the Best Country Overall
While Estonia might be an outlier when it comes to start-up choices, one country managed to get no less than four cities in the top ten. Canada featured with Toronto, Montreal, Vancouver, and Ottawa.
The cost of living is relatively high in a place like Toronto but the ease of business set up, and access to credit combine to put the city second on the list. The tax situation is also a motivating factor, and a score of 9.5 out of 10 puts it way ahead of many of its competitors.
Silicon Valley is Still a Major Player
While you may think that Silicon Valley has had its day, the region still hits the mark when it comes to attracting new ventures. Especially in the early stages of business development, it rates top in the Go Compare listing. Ease of doing business is as you might expect for an area that is at the forefront of tech development but the relatively high cost of living means that it only makes the 8th place on the list.
Diversity in New Businesses
Many start-ups also measure the diversity level of the location they are likely to set up in. This can be a difficult one to gauge but a workforce that better reflects general society is desirable. When it comes to diversity, Silicon Valley is way out in front ahead of New York, Paris, and Chicago. Cities like Seoul in Asia and Cape Town in South Africa have a higher number of businesses created by ethnic minorities.
The Cost of Living
Most of the top ten in the Go Compare listings are expensive places to live. The comparison team used a couple of parameters to measure what impact each city might have on your pocket, one of them being the cost of a cup of coffee. You might be surprised to learn that areas like London are not as expensive as up and coming start-up hubs like New Zealand and Singapore where the cost of living can be prohibitive.
It is this factor that can often put entrepreneurs off when they are first looking to start a business. Moving to an entirely new location is a daunting prospect but it’s something that millennials seem to embrace more than any other group.
Early stage funding can be a big draw also, mainly if you choose the right location. Of course, this can vary from city to city. For example, the average early-stage funding for a start-up in Shanghai is $762,000, and in New York, it’s $682,000. Head to New Zealand, and you might be lucky to land just over $7,000 in investment for your new start-up.
If your tech business depends on digital connections, you may find some of the download speeds in major cities around the world a little troubling. Even in Silicon Valley, you might be looking at just 3.7 Mbps while in Helsinki you can look forward to 17.4 Mbps.
A lot comes down to weighing up the different benefits of each city and deciding which city is likely to give your new business the best of starts. If you’re an entrepreneur wondering whether you should pack your bags before starting a new venture, you can see the full interactive tool on the Go Compare website.
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