It’s not Silicon Valley, Silicon Alley, or even Silicon Beach, but if a company wants to change the way the country works, there’s not a better place to be than Washington, D.C.
D.C. is focused on politics, and anyone who doesn’t work for the federal government is probably at a lobbying firm, a nonprofit group, or another organization hoping to benefit from the proximity to Capitol Hill. More and more, that includes startups.
“There are a lot of startups in D.C. trying to disrupt how the government operates and how the services of the government can improve with private sector innovation,” says Jonathan Ericksen, project manager and former community manager at WeWork K Street. “Washington might not have something sexy like Snapchat, but people are doing serious stuff.”
At last count, D.C. is home to more than 1,000 technology startups. That includes a wide range of industries.
“For the past five years I have worked here for startups in various stages,” says Andrew Vincent, vice president of product at United Income, a company focusing on retirement services. “It is the hub of technology and policy. Education technology thrives here; so does fintech.”
D.C. is also the first city to host the Creator Awards, a global initiative by WeWork to “recognize and reward the creators of the world.” Over the course of a year, WeWork will be giving out more than $20 million at a series of events taking place in cities spanning the globe. The D.C. event is March 28.
Here are six reasons the region is luring entrepreneurs.
1. A diverse workforce
You hear a lot about the need for diversity in tech, and Washington makes good on that promise.
Anthony Shop, cofounder of the digital agency Social Driver, says that being located in “one of the most diverse and inclusive communities in the entire country” gives tech companies a competitive edge.
“Companies who seek a diverse workforce can find it in D.C., so they locate and open offices here,” says Shop. “A diversity of backgrounds leads to fresh ideas, which make companies more competitive.”
“The range of startups here go from virtual reality to government contractors to filmmakers,” says Merav Yuravlivker, cofounder of Data Society. According to the WeWork Chinatown member, the diversity “encourages collaboration across industries, which has been a boon for our growth as a business.”
D.C. is also a great place for female entrepreneurs, since a third of area businesses are owned by women. Fast Company analyzed data from around the county and named D.C. the best city for women in tech.
“For women of color—black, white, and Latino—D.C. is the best place to be,” says DeShuna Moore Spencer, founder and CEO of kweliTV, an interactive streaming platform for the black community.
2. A focus on social good
A reason many entrepreneurs are drawn to D.C. is the fact that so many organizations are charged with helping people. It started decades ago with nonprofit groups, and has continued with the newer crop of tech-oriented organizations.
“D.C. is full of smart, ambitious people who want to make the world a better place, and isn’t that what an entrepreneur is?” says Vincent.
Spencer agrees, saying the environment is perfect for companies who want to change things on a national or global level.
“Our focus is social justice, which is why this is a good location for us,” says Spencer. “We have independent films and scripted content dedicated to issues and stories from around the world. It’s important for us to have the social impact element.”
One good example is the startup Open Data Nation, which uses public data to predict risks to public health and safety in major cities around the country.
“We aim to do good using data science techniques,” says founder Carey Anne Nadeau. “We want to keep residents of cities healthy, happy, and safe.”
Her platform can help predict everything from food safety problems at restaurants to accidents at construction sites.
3. Plenty of talent
D.C. has one of the nation’s most qualified and diverse population when it comes to tech. More than 185,000 people are employed in the tech sector, including a cybersecurity workforce of 27,000 in the metropolitan area, according to the Washington D.C. Economic Partnership.
“We can find really good talent here,” says Vincent, whose staff works at WeWork K Street. “We started in D.C. because the policy and research insight we received from think tanks helped us to identify this problem. That wouldn’t have been possible in another city.”
D.C. is home to more than 30 incubators, accelerators, and coworking spaces, including many that are focused on building diverse companies.
“There are people here from all across the country and the world that bring unique perspectives and experiences to solving tough problems,” says Matt Monks, catalog operations manager at the on-demand grocery delivery service Instacart. He works out of the company’s local office at WeWork Dupont Circle.
In the past, finding talented staffers in the tech sector was difficult for local businesses. That’s changing as New York City and the San Francisco Bay area become more expensive, encouraging Millennials to seek out more sustainable options.
4. An educated population
The number of universities in the metro area—including American University, Georgetown, and Howard University—means Washington is ranked the second most educated city in America.
“There is a reason why major universities open up satellite campuses here,” says Vincent. “There are a lot of opportunities and lots of competition for the best and brightest.”
The city has among the highest percentage of graduate, bachelor, and professional degree holders in the nation.
“D.C. is a great place, especially for ed tech, because it’s rich with universities, thought leaders, talent, and associations that set policy or inspire innovation,” says Kimberly Moore, founder of Carpool to School. “The entrepreneurs in tech want to be part of a good community and contribute to each other’s success.”
5. An abundance of capital
“There are a lot of VCs and investors,” says Spencer. “You might assume D.C. is all about policy and politics, but it is a really great place to tap into the international community and global funding and accelerators.”
Spencer says kweliTV is one of 10 companies that participated in accelerator TipHub’s 12-week program this past fall. They promote innovation and manage a network of angel investors supporting startups dedicated to making an impact in Africa and Africa’s diaspora.
“I’m a person of color with a niche streaming service,” says Spencer. “In D.C. there are a lot of diverse angel investors who get it faster, since they are part of that diverse community.”
With local efforts underway to reduce the capital gains rate for angel investors, Washington could attract even more investors in the near future.
6. Experts in the private sector
Washington will always be a government town, but the changes in the executive branch have encouraged some of the District’s best and brightest to look toward the private sector.
“One of the things I have been encountering since the election, is that there are these young, smart, driven people who want to continue to make things happen,” says Vincent. “And they don’t feel the government is the best place to do that right now.”