Seattle continues to be among the national leaders in startup culture. Long recognized for its innovative spirit and numerous successful young companies, Seattle was given the top spot in Business Insider’s rankings of startup launch cities across the U.S. Those rankings gave the city an impressive 99.20 “entrepreneurship score” (Austin, Texas was in second place with a 93.03), and notably pointed out that 77.5% of people starting businesses are not doing so because they can’t find work elsewhere. These numbers speak to the inherent startup culture that still prevails in Seattle.
Despite the city’s well established startup culture, there are bound to be changes in the coming years. So we decided to do our best to identify a few trends likely to emerge in the city.
More Startups Founded Out of Necessity
One of Seattle’s more impressive assets as a startup hub is that it’s a place where innovation occurs for innovation’s sake. Data shows that 77.5% of people start businesses instead of looking for a job. But that number may well change in light of the economic devastation caused by the pandemic.
The country as a whole has experienced an unemployment crisis that is unprecedented in the modern era, and the state of Washington has not gone untouched. A recent report by The Wenatchee World noted that as of mid-October, unemployment claims had actually reached a new 10-week high. This shows, unfortunately, that the crisis may persist longer than many had hoped, and it will inevitably mean that more people are out of work or unable to find it in Seattle and around the state. This is likely to lead to a spike in new startups that are founded out of necessity.
More Registered Companies
Another change we’re likely to see as a result of the difficult conditions of 2020 is a greater focus on legal protections and tax breaks. Given what has happened to so many unprepared companies in 2020, entrepreneurs will be eager to find ways to save money and protect themselves against future issues.
There are lots of ways for startup founders to explore various safeguards. But in Washington, one of the easiest options will be to register new companies through official means. As is explained in an outline of Washington LLC creation by ZenBusiness, this is something that can be accomplished very quickly, and which can result in a formally registered business. This can protect a founder from certain legal issues, lead to a more favorable tax situation and — most significantly — put the company on the state government’s radar for eligibility for future aid packages. To put it more simply, a legally registered company is in a better position to receive support in the next crisis than an independent operator, which is why we expect to see more startups taking this route.
A Focus on Health & Technology
Health and Technology sectors are already dominant in Seattle. Tech in particular is largely responsible for spawning the startup culture. Businesses in these sectors are thriving even in the midst of the pandemic.
Aspiring entrepreneurs in startup hubs who have done their research will notice that businesses related to health and technology are the ones that are actually thriving. Health and Technology are competitive markets, but they’re very likely to drive a lot of new startups ideas. Entrepreneurs tend to be opportunistic ,thereby capitalizing on the changes brought about by the pandemic.
A Focus on Education
It was just last year — before the pandemic — that we made note of education as “The Ultimate Startup” opportunity. Specifically, it was preschool education we were noting, especially in light of the Helsinki International Schools project. Now in the midst of the pandemic, it may be time to look at education as a field that is ripe for startup innovation.
While there is still hope that children of all ages can go back to actual classes in person, sooner than later, the pandemic has demonstrated just how inflexible (and often inadequate) our systems of education really are. This is a large, widespread problem, and where deficiencies exist, entrepreneurs see opportunity and create startups. Over the next few years, we can expect to see a surge of inventive concepts and technologies related to education