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There’s a great irony when you consider that the “Big Three” cities for entrepreneurship — San Francisco/San Jose, Boston, and New York — are some of the most difficult places in the U.S. to live on the sort of shoestring budget that startups demand. Nonetheless, they are home to “about half the VC firms and an equal percentage of the U.S.-based companies that they finance,” according to a paper published by the National Bureau of Economic Research. This gravitational pull has historically given these cities an upper hand, making it difficult for smaller cities to compete, but as the surge in entrepreneurial activity and migration of talent around the country continues, investors and influencers are starting to look elsewhere for great entrepreneurs.

With nearly every metropolis vying to become the next Silicon Valley, New Orleans would rather become a better version of itself: the next New Orleans.

Prior to Hurricane Katrina, in 2005, New Orleans was a place where too many people accepted that the city’s zenith had passed over 150 years ago. After the storm, a group of young entrepreneurs and emerging leaders banded together, first in tragedy, then in rebuilding, and then in reinvention. New Orleanians new and old returned to their city with a newfound sense of urgency, and they began to look at some of those decades-old problems that had dogged the city with fresh eyes, whether in education, transportation, food service, or music. Katrina allowed one of America’s most historic places to reimagine itself as a startup city. This quickly attracted entrepreneurial talent eager to find their place in the Crescent City’s renaissance. Now, New Orleans is being recognized as a hub of innovation, with a rate of business startups 64% higher than the national average.

Considerable ink and air time have been devoted to analyses attempting to pinpoint the driving force behind the positive momentum, with the conclusions falling predictably into one of two categories: resilience or reform. Yes, both have played a role in making the city a less risky base for businesses. But these factors alone do not explain the dramatic turnaround.


Most established startup hubs have image issues. Millennials in particular see them as either prohibitively expensive, culturally devoid, or both. But New Orleans offers both culture and an affordable cost of living. With world-renowned food and live music scenes, New Orleans is a city of rhythms and rituals, all organized around a unique cultural calendar. It’s that lure that brings in eager migrants from all over the country, and when they arrive they find not only the fun-loving and diversity-embracing culture they’ve heard so much about, but also the newfound energy that’s characterized a city determined not to fade into history.

This, coupled with relative affordability, makes it a place people want to call home.

In 2011, demographer Joel Kotkin developed a list of the U.S.’s “biggest brain magnets,” cities where college graduates are flocking, and New Orleans ranked at the top. His analysis revealed that the college-educated were looking for affordability, with “many ending up in places with lower housing prices. Areas with the highest-price housing experienced college-educated growth at a rate only 60% of those with more affordable real estate.” According to a CNN Money cost of living calculator using December 2015 figures from the Council for Community and Economic Research, the cost of housing in San Francisco is 227% higher than in New Orleans, groceries cost 25% more, and transportation costs 33% more. Similarly, housing in New York is 368% higher, and Boston is 95% higher. College graduates looking to move to an established hub may find that they either cannot afford it or do not want to pay the price to live in those places.

New Orleans recently earned its place as one of the “20 Hottest Startup Hubs in America” in a report from the Ewing Marion Kauffman Foundation. The city’s new status is why Lucid, a software company and global data platform that completed more than $100 million of sample transactions in 2015, is in New Orleans, along with Kickboard, a technology company helping to create smarter schools, and Smashing Boxes, a creative technology firm known for creating a lasting experience through bold design and disrupting the status quo.

It doesn’t take too many conversations with locals to realize that New Orleans has no interest in becoming San Francisco — but rather than stymying innovation, it’s that fierce sense of identity that has driven New Orleans in the post-Katrina era. The city developed a new atmosphere of inclusion and collaboration and a sense of unified purpose in those years, and that same drive is now pushing the city to places it’s never been before. It’s resilience, yes, but there is something more. New Orleans is a city with the confidence to remain itself even in an increasingly homogenous country.

Tim Williamson is founder and CEO of The Idea Village, an independent 501c3 nonprofit organization dedicated to fostering entrepreneurship in New Orleans. The organization is producing the 8th annual New Orleans Entrepreneur Week March 11-18, 2016 in downtown New Orleans.