Why These 8 Startups Chose San Diego as a Headquarters

05/12/2017 09:42 am ET

By Beck Bamberger

I’m from San Diego, a town known for “slow startups.” That is, companies that want to build bombs, beer or biotech and need 10-plus years to perfect products find San Diego a great spot for a headquarters. But two or three years ago, things changed. Startups from fintech to edtech filled new co-working spaces, warehouses and corporate floors. Relative to San Francisco, San Diego has a good cost of living, touts the best weather in the country, has fewer traffic woes, and has a solid stream of eager college grads coming to town. I recently attended The San Diego Venture Group (SDVG) job fair in San Francisco, where 30 San Diego-based companies toured the bay area. Nearly a thousand engineers showed up, resumes in hand. Companies are getting more vocal about coming down to America’s finest city.

And I’m seeing this shift firsthand. For the first time ever, potential startup clients aren’t calling upon my PR team just from San Francisco, New York, and other international cities. These potential startup clients are calling us from half a mile away. Not only is the business coming locally, the talent pool is swelling as well, prompted by local colleges’ communications programs and simply more young PR people visiting San Diego on a whim and deciding to move here. I could easily go on about why I’m a San Diego entrepreneur for life, but I'll let other startups do the talking. Here’s a short roundup of why entrepreneurs are planting a flag in San Deigo.

Alumni Pull Matters 

“San Diego has its many benefits, but to the success of Industry, one of them is access to talent from our local universities,” says Cody Barbo, co-founder of a platform that helps hospitality businesses (restaurants, bars, hotels) find 30,000-plus employees in markets such as San Diego, Seattle, Phoenix, Denver, Las Vegas, and soon to be Chicago and Miami. “My co-founders and I are all San Diego State alums, and of our 22 team members, 11 are Aztecs. The campus experience is unmatched, and fits our culture very well as we look at talent acquisition and employee retention.” I met Cory via another San Diego founder. My agency continues to find stellar communications interns from SDSU as well.

Capital Lasts Much Longer

“We’ve been able to survive significantly longer with the capital we raised here rather than in another startup city like San Francisco or Boston,” says Hayley Brooks, co-founder of Whooo’s Reading, a digital reading program used by more than 40,000 teachers nationwide. “The cost of living in San Diego is so much lower, and there is significantly less competition for talent. So, we have been able to attract quite high-quality talent at a fraction of the cost and retain that talent, extending our runway two-to-three times longer than it would have been in another city.”

A Generous Nonprofit Opened the Floodgates

"OSSIC relocated its headquarters to San Diego in 2015 for the opportunity to join the local nonprofit tech incubator, EvoNexus. EvoNexus provided an immediate entrance into the San Diego startup and investment community,” says Jason Riggs, CEO of a company that produces the world’s first 3D audio headphone that instantly calibrates to the listener. I’ve spoken a few times at EvoNexus, and the incubator has a robust flow of companies “leaving the nest” for larger office space.

Burnout Just Isn’t Feasible

“I’m going on 17 years starting and running tech companies in SD, and I'm as happy as ever, with no burnout in sight.  You can work yourself to the bone during the week but then there's always great weather and a million things to do on the weekends for exercise and fun. From hiking Torrey Pines, to all the beaches to the pool parties to the great restaurants downtown, life never gets stale in San Diego,” enthuses Jon Carter, founder of Empyr and good friend. Empyr offers an online-to-offline (O2O) commerce program for some of the world’s largest tech banks, airlines and hotels and currently has 60 employees.

It’s a Goldmine for Creative Talent

Simon Casuto, another friend of mine in town, remains in San Diego for the hungry, sharp creative talent. He notes, “San Diego has been investing in developing creative schools, honing not only students’ creative abilities but also harnessing their thinking and entrepreneurial possibilities. Our business has continued to grow rapidly, and San Diego has consistently provided us with the talent we need to serve our growing client base." Casuto is the co-founder of ELM, a digital learning company with clients such as Google, GE and Nestle.

It’s a Goldmine for Niche Technical Talent, Too

Mike Ritter’s startup, SlantRange, was noted in Bloomberg this year as one of 50 “most promising startups you’ve never heard of.” He explains, “We’re in San Diego because some of the best talent in the world specific to our industry (airborne remote sensing and analytics of agricultural crops) is here. Scripps Institution of Oceanography is a world leader in remote sensing and analytics related to earth sciences applications. General Atomics, Northrop Grumman, and other defense companies are developing some of the world’s most advanced airborne robotics and intelligence collection/analytics capabilities. Most of our team came out of these institutions so for us there’s no better place to recruit.”

There's Low Talent Turnover

David Tal and his brother Avi are co-founders of Agentology, a real estate tech startup that’s gone from eight employees to 46 in the last two years. We went to high school together, and we’ve seen San Diego balloon into the hot hub that it is. Our agency matches David’s observation: “There’s just far less employee turnover in San Diego. In SF, employees are constantly being recruited from one unicorn to the other. But in San Diego, there’s a different culture and loyalty around this theme.”

You Can Be a Big Fish in a Small (For Now) Pond   

One thing I love about being in San Diego is that most founders know one another. I host a monthly dinner just for founders, and it’s easy to keep tabs on everyone. Derik Barclay, the co-founder and President of LoanHero, came to one of my dinners recently. His co-founder and LoanHero’s COO, Kristin Slink, said, “If you want to be involved in the startup community and get in on the ground floor of a startup movement, then San Diego is a great place to call home. The movement is happening right now.”

Eager and cheaper talent, good vibes, and a still a small town feel are drawing startups to San Deigo. Why isn’t your startup here yet?

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Beck Bamberger founded BAM Communications in 2007 and has since founded three other businesses, Bite San Diego, Nosh Las Vegas and Pangea Pal.

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