To find the city where technology startup businesses are thickest on the ground, look no further than the Valley. Both Chandler and Mesa rank among the Top 10 for cities with the most tech startups — computers, software, medical devices and electronics — per capita.
That is one of the striking findings of a ranking of U.S. cities by technology startups per capita. Another is that none of the Top 10 tech startup hotbeds lies east of the Mississippi River. Silicon Valley boasts three, Southern California has another and the rest scatter across Texas, Arizona, Nevada and Washington.
The data and analysis came from SizeUp, a San Francisco–based provider of free business intelligence for small and mid-sized businesses. SizeUp CEO and cofounder Anatalio Ubalde sifted through millions of records from a plethora of sources to build it. He and his team identified companies less than five years old in the fields of computers, software, medical devices and electronics that were located in the top 100 cities by population.
Here are the top 10 cities for the most tech startups and the number of startups they have per 100,000 population:
1. Fremont, CA, 21.3
2. San Jose, CA, 10.1
3. Irving, TX, 6.5
4. Chandler, AZ, 5.1
5. Austin, TX, 4.5
6. Paradise, NV, 3.9
7. Anaheim, CA, 3.8
8. Mesa, AZ, 3.7
9. Seattle, WA, 3.5
10. Santa Ana, CA, 3.3
Steve Sanghi is the President and Chief Executive Officer of Microchip Technology.
How is being CEO of a technology company different from being CEO of a more traditional manufacturing company?
I used to think it was very different, but I’m not sure I believe that anymore. I understand the technology of a project, why our technology is better than the competition’s and why it is not. I think that makes me more effective. But it can also make CEOs with a technology background more biased; they do not rely on the team as much as they should.
Video by Duane Darling
What has been your most significant challenge as CEO of Microchip?
The first challenge was taking the company and turning it around. We were in so much trouble financially. We had no cash to go forward. Our technology was outmoded. Our employees lacked morale. Our factories were inefficient. So we took all those elements and developed what we call the “aggregate system,” a big-picture approach where we took all the elements of the business and created a better workplace and management culture that allowed us to succeed.
Any plans to expand your product lines?
I call my acquisition strategy “elbow out.” Our products need products from other companies around them to make them work. So we look at companies that make products that we do not make ourselves, then we look at acquiring them so we can “elbow out” the competition.
How does technology fit into Arizona’s economic future?
If you look at the state’s first 75 years, the four Cs that drove the economy were copper, cattle, citrus and climate. If you look at the last 25 years, technology, construction, retail and hospitality have taken a more prominent role. As we look forward, technology is going to play a more dominant role in Arizona’s economy as the world keeps moving toward a knowledge economy. So the four Cs that are driving Arizona today are computers, communications, consumer electronics and climate.
How is Arizona as a place to do business?
We have more than 400 people working here. Our business has grown from a $70 million company into a $1.5 billion company, so it has worked well for us. But there are pros and cons. Many times, to get the right talent, we have to go to other technology centers — California, Oregon, Texas, Colorado. If we had the talent here, it would make things easier. A benefit of being in Arizona is that we have a lower cost of living, the cost of doing business is lower, and our turnover rate is much lower than other tech centers. We have always been proud to call Arizona home.
What three things would make Arizona more tech-business friendly?
No. 1 is to improve the schools. Arizona high schools are near the bottom and if we don’t improve them soon, it’s really going to impact the future. No. 2 is getting a handle on the immigration problem and controlling it. No. 3 is that Arizona has historically lacked risk capital. Having more risk capital available is crucial so entrepreneurs can build companies here instead of having to look elsewhere.
Your biggest accomplishment as CEO?
Taking a company that was hemorrhaging money in 1990 and leading it to 84 consecutive quarters of profitability is something that I could not have imagined and is something that no other semiconductor company has been able to achieve. Right now, we are shipping about a billion units a year. So to see how far we have come and how well our products are accepted makes me very proud. You can only see so far in the future, but when you get there, you can see farther.
[stextbox id="alert" bcolor="ffffff" bgcolor="eaeaea" image="null"]Vital Stats: Steve Sanghi
Named president of Microchip in August 1990, chief executive officer in October 1991, and chairman of the board of directors in October 1993.
Author of the book “Driving Excellence: How the Aggregate System Turned Microchip Technology from a Failing Company to a Market Leader (Wiley).”
Member of the board of directors of Xyratex Ltd., member of the national board of directors of FIRST (For Inspiration and Recognition of Science and Technology) Robotics, and a member of the Board of Trustees of Kettering University.
In 2010, Mr. Sanghi was named EE Times’ — a leading electronics-industry publication — “Executive of the Year.”
Under Sanghi, Microchip’s returns have increased 4,476% since the Company’s IPO in 1993.
Honored with the Arizona Technology Council’s 2010 Lifetime Achievement Award.[/stextbox]