Moving From San Francisco to San Diego Saved This Startup

How relocating to a second-tier tech hub makes business sense.

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It’s no secret that the Bay Area is getting unreasonably expensive. A recent survey found that 1/3 of Bay Area residents hope to leave the region soon, citing rising housing prices as a major factor.

For startups, the situation is much the same. Companies are suffering under rising office rents, making second-tier tech hubs a more appealing option. For a company called Bizness Apps, packing up and moving down to San Diego was the right call. In a TechCrunch piece published a few months back, founder Andrew Gazdecki explains how his company came to this decision.

Housing and office prices aside, recruitment was a major factor pushing Bizness Apps away from SF. It’s ironic given that the Bay Area is such a tech powerhouse, but the problem lies precisely in the fact that it’s a tech powerhouse. The tech startup job market in the Bay Area is practically a seller’s market—with such a concentration of successful companies, only the biggest and the best are able to attract top talent. Newer startups have trouble paying the salaries demanded of the Bay Area’s best.

This problem can be solved instantly by relocating to a smaller region. If your company is the big fish in a small pond, you’ll attract the best talent the city has to offer without having to fork over a Google-tier salary. As a bootstrapped company, Bizness Apps had trouble attracting talent without the backing of top VCs, so the move helped their recruitment game.

Similarly, the battle for perks and employee retention is easier in a smaller job market. SF startups can’t beat the local tech giants with pure salary or perks, so they have to rely on abstractions like culture and mission—things that aren’t always going to keep employees around forever.

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Secondary tech scenes are blossoming across the country. San Diego’s community is growing, but it’s still small enough that up-and-comers stand a chance at making an impact. Furthermore, because the scene is relatively small compared to SF’s, there’s a noticeable air of collaboration rather than competition. Startups are more inclined to share resources and support one another because the competition isn’t as cutthroat.

If you’re thinking of fleeing to an up-and-coming tech hub, there’s comfort in knowing that you’re not the only one. While New York City and San Francisco continue leaking residents, migration is increasing to cities like Seattle and Austin. Even if you’re not in the center of the tech world, there are plenty of cities with a growing community to offer.