Thanks to a strong economy, it’s a good time to grow and scale a tech company. The U.S. economy grew 2.9 percent last year, its highest growth rate since 2015. Plus, unemployment is low at 3.6 percent<\/a>. Favorable tax climates and a growing, educated workforce are also driving business growth in cities across the country. Denver is a prime example<\/a>. <\/p>\n\n\n\n In a state where the tech industry is growing rapidly\u2014Colorado added more than 7,000 tech jobs in 2018, a 2.5 percent year-over-year increase<\/a>\u2014Denver is developing a thriving, tech ecosystem buoyed by state and local resources that embrace business.<\/p>\n\n\n\n \u201cDenver has always had a very intentional strategy about what we call our \u2018start up, scale up, grow up\u2019 ecosystem when it comes to entrepreneurship,\u201d says Deborah Cameron, the chief business development officer for Denver\u2019s Office of Economic Development. \u201cIt began by scanning our environment to see what was really needed and studying other successful locations.\u201d<\/p>\n\n\n\n A low corporate tax rate, an educated workforce, and a plethora of resources make Denver business-friendly. But it\u2019s also the intangibles, like a collaborative culture and a better work-life balance, that make the city work so well for business.<\/p>\n\n\n\n Denver\u2014and the entire state of Colorado\u2014still has its challenges, particularly competition for skilled talent amid ever-increasing job growth. But the city is forging a path for business that other cities may want to follow.<\/p>\n\n\n\n Fortune 500 companies like Amazon, Facebook, and Arrow Electronics all have offices in Denver\u2014and the city has also welcomed homegrown companies like SendGrid, an email delivery service recently acquired by the cloud communications company Twilio for $3 billion.<\/a><\/p>\n\n\n\n Denver is just one of several cities in Colorado\u2014including Boulder, Fort Collins, and Colorado Springs\u2014with a growing tech community. But, says Jeff Wilkins, CEO of Motili, a property management technology platform, \u201cDenver is differentiated by its quality of life, pool of young tech talent, and infrastructure. The area also isn\u2019t dominated by tech the way the San Francisco Bay Area is. You\u2019ll meet just as many people who want to open a microbrewery as those who want to create the next great app.\u201d<\/p>\n\n\n\n \u201cWe felt that to build a really strong company culture, you’ve got to have diversity and some kind of stimulation around,” says Kyle Sherman, CEO of Flowhub, a WeWork Triangle Building<\/a> member company that creates compliance and point-of-sale software for cannabis dispensaries. \u201cWhen you walk outside, there are restaurants, things are accessible, there are parks\u2014you get all of that downtown. There’s life.\u201d<\/p>\n\n\n\n Several things have fueled Denver\u2019s business growth, including tax incentives, growing infrastructure, and a collaborative environment. Colorado offers a job growth incentive tax program that gives businesses income tax credits for creating jobs the state wouldn\u2019t have otherwise. There are tax credits for new business development, business expansion, relocation, and for job creation in enterprise zones or economically disadvantaged areas. Companies also benefit from sales and use tax refunds for investments in the manufacturing, biotechnology, renewable energy, and medical and clean technology industries.<\/p>\n\n\n\n Sherman says his company took advantage of the state\u2019s research and development tax credit. This is a 3 percent credit for taxpayers and companies who increase research and spending on product development or new lines of business within enterprise zones.<\/p>\n\n\n\n Though Denver charges a head tax ranging from $4 to $5.75 per employee per month, businesses benefit from the state\u2019s low 4.63 percent corporate tax rate. As of the 2016 fiscal year, for every $1,000 of corporate income, Colorado effectively taxed $2.17<\/a>, according to the Colorado Fiscal Institute. The rate can be as high as $9.38 in some states. Colorado is also one of nine states with a flat income tax, also 4.63 percent (the fourth lowest rate in the country).<\/p>\n\n\n\n Denver has a robust transportation infrastructure. Along with a rapid transit light rail and bus system, and free transportation in parts of downtown, the city is home to Denver International Airport, which has nonstop service to most U.S. cities, Europe, and Asia for easy executive travel. <\/p>\n\n\n\n \u201cThe local government has invested considerably in mass transportation and cultural amenities like public parks,\u201d says Josh Reeves, CEO and founder of Gusto<\/a>, a human resources, payroll, and benefits solutions provider that has grown its Denver team to more than 500 employees in the past three years. \u201cThe investment in public infrastructure gave us confidence the city would be able to scale along with us.\u201d <\/p>\n\n\n\n The city and business community also have invested in building the business ecosystem. WeWork has opened 10 locations in Denver <\/a>to support the growing business needs in the area.<\/p>\n\n\n\n The city partnered with the Colorado Technology Association and the Downtown Denver Partnership in 2015 to create the \u201cCommons on Champa.\u201d<\/a> The public space, which hosts more than 200 annual events, is \u201cthe crossroads for entrepreneurship and innovation in Denver,\u201d Cameron says.<\/p>\n\n\n\n Kristin Russell, president of global services at Arrow Electronics and the state\u2019s former secretary of technology and chief information officer, says that collaboration is what differentiates the area from other tech hubs. <\/p>\n\n\n\n \u201cIn many other cities and communities in which I have work and lived, there just isn\u2019t the level, interest, and intent around collaboration,\u201d Russell says. \u201cThe concept of \u2018the high tide rising all boats\u2019 is never more true than in Colorado.\u201d<\/p>\n\n\n\n Patrick Quinlan, CEO of the ethics and cloud compliance platform Convercent, says that as more technology companies come to Denver, the level of collaboration grows.<\/p>\n\n\n\n \u201cOne of the real benefits of starting and building Convercent here is the CEOs are very supportive of each other,\u201d Quinlan says. \u201cWhen I have a question, thought, or concern, I can drop somebody a note or jump on a five-minute call. It’s a helping culture, not a competitive culture.\u201d<\/p>\n\n\n\n That extends to how people work. With easy access to the outdoors, Denver combines urban living with a relaxed culture. As part of that culture, WeWork provides wellness programming to members across all of its 10 Denver locations<\/a>, including regular yoga classes, meditation sessions, massage and spa pop-ups, various Denver-based wellness brand highlights, and more. Other companies offer employee perks ranging from Yoga Wednesdays to dog-friendly workplaces<\/a>. Gusto even gives employees a free round-trip ticket to anywhere they choose after their one-year anniversary.<\/a><\/p>\n\n\n\n Frannie Matthews, president and CEO of the Colorado Technology Association, says that even with this laid-back environment, the tech community is very productive.<\/p>\n\n\n\n \u201cWe’ve got a great ecosystem here, but it doesn’t mean that we’re out mountain biking on Thursday afternoons,\u201d Matthews says. \u201cIt means we love where we live and we love the recreational aspects of it. But this is a work-hard community.\u201d<\/p>\n\n\n\n Even amid all this success, one of the main challenges that Denver faces is competition for talent. <\/p>\n\n\n\n The city has an educated workforce: Forty-one percent of residents have at least a bachelor\u2019s degree, compared to 25 percent of the workforce nationally. But with Denver\u2019s 2.9 percent unemployment rate, competition for talent is fierce. <\/p>\n\n\n\n \u201cIt\u2019s harder to scale in a small city because the bigger you get, the harder it is because you have to poach people from other companies,\u201d Sherman says. <\/p>\n\n\n\n The key to addressing this challenge, business leaders say, is to create a talent pipeline across the state. The Office of Economic Development has focused on building sector partnerships to bring together higher education and business groups to address the pipeline problem. Cameron says some local schools with two- or four-year degree programs now offer short-term credentials to accelerate upskilling the local workforce.<\/p>\n\n\n\nDenver boasts a business environment tailor-made for tech<\/strong><\/h2>\n\n\n\n
![\"\"](\"https:\/\/www.wework.com\/ideas\/wp-content\/uploads\/sites\/4\/2020\/02\/538wework-bus-friendly-1-1.png\")
<\/figure>\n\n\n\nUnpacking Denver’s appeal<\/strong><\/h2>\n\n\n\n
Business incentives and low taxes <\/strong><\/h2>\n\n\n\n
A strong infrastructure and business resources<\/strong><\/h2>\n\n\n\n
A collaborative, balanced work culture <\/strong><\/h2>\n\n\n\n
![\"\"](\"https:\/\/www.wework.com\/ideas\/wp-content\/uploads\/sites\/4\/2020\/02\/538-wework-Denver1200.png?resize=579%2C1208\")
<\/figure><\/div>\n\n\n\nConfronting challenges to business growth<\/strong><\/h2>\n\n\n\n