Questions

Should I start a consulting service in a large city, or should I stay in a medium sized city?

I'm learning web development and interested in starting my own consulting business and working for myself. I currently live 20 miles outside Dallas TX. I have no friends or family ties keeping me here. I could leave tomorrow and I would feel fine. I don't know if I should start my consulting service here or move to a mega-city like LA or San Francisco or Silicon Valley area. I'm confident I will start to get some success in a few years because I'm driven and I'm offering a business service that businesses need and I'll get better at it as time goes by. But I dont know if I would be better staying where I am because the cost of living is so much easier, but the people here aren't as driven as you find in the larger cities. When I go to business meetings people don't seem as motivated or sharp as they do in bigger cities. Maybe when living expenses are high it drives people to work harder. I'm just wondering what are the pros and cons of starting a business in a small town vs a large city. ps - Im not interested in moving to Austin at all. I'd rather either Stay in Dallas for low cost of living or move to West Coast for nicer weather and higher potential rewards for hard work.

6answers

Because of the nature of your consulting business (web development) you have the advantage of being able to effectively offer your services remotely. I think more important than deciding between a large or small city, is finding a city where you would enjoy living and building a network. Is there a city where you have a critical mass of friends, family, potential business partners? Is there a city you'd simply be happier in because it fits your lifestyle, whether it's access to outdoors or city living?

Do you have a more specific market segment you'd like as your clients? Do you want to service just tech startups? Health tech startups? Larger companies? Unless you plan to really narrow down into a specific niche, like consulting just for the aerospace industry where the companies are usually found in a specific city or region, web development offers you a lot of geographic flexibility. More and more companies like Automatic or Zapier have completely remote teams and the trend towards that is only accelerating.

Choose a city where you'll be happiest and most likely to be able to participate in the lifestyle the city provides. Not only will you be more productive if you're happy, you'll have more opportunities to grow your network organically by meeting friends through your hobbies or social activities that then turn into clients.

I'd caution against being overly analytical or coldly rational when making this decision. Follow your gut. Choose a city you'd love to live in and grow a business in. I know wildly wealthy and successful entrepreneurs in cities both small and large.


Answered 3 years ago

I've run my agency (Ideaware) from South America for 5+ years now, from a small city. We have worldwide clients and do all of our work remotely. From my experience, it is possible to run a 7-figure consulting business from anywhere. In fact I would recommend it. Factors such as cost of living and talent availability are much more important than being in the center of Silicon Valley (and you can still have all of your clients there if that is your target market).


Answered 3 years ago

Some good answers already.

I have just taken the same step. I was living in London for most of the last 11 years, where I needed to be for regular work / contracting.

But when it came to setting up my own company, I was getting nowhere due to the cost of living, and kept getting tempted back into the contracting market to give my finances a boost so that I could then step back out to give my business a go.

But as a result I never got traction.

A few factors finally collided and came to a head, and decision was made to uproot. I decided to combine family considerations with the business ones; move north where I have family, get away from the London rat-race (I don't need that anymore), and start the business properly, from home, in a new, quiet area.

And.. bingo. Best thing I've ever done.

So I echo one of the above comments - think about your life and where you really want to be. But I would say very much think about living costs. You're going to need time to get traction with your business; the lower your living costs whilst you're doing this, so much the better.

Ideally you want at least 2-3 years of keeping your costs down, so you can keep as much money in the business as possible.

If you can combine your preferred location with the best location for your business (those costs being a factor), then hopefully you'll know where to be.


Answered 3 years ago

What a great question to get on Clarity. Great to see entrepreneurs of all levels on the site. In my 10 years as a financial services consultant I have relied on my "network" of contacts and online resources such as Clarity and LinkedIn for my consulting clients. If "on-sight" is of major importance to you in your business, I would suggest going to an area where you feel your business would have an advantage by being close to where you live. In today's on-line world, many consulting jobs can be completed from anywhere. Just some food for thought. Good luck!


Answered 3 years ago

Hi, I see you've already had some great answers and I will respond along the same lines. These days, it doesn't really matter where you are based - especially with the type of services you offer, you can work remotely from the location of your choice. If you have family or friends in another place, then my suggestion would be to get closer to them - starting up can be tough and when things are not quite going the way you'd like them to, it's nice to be able to meet up with good friends for a drink / meal / movie etc. - strong friendships can help you recharge your batteries... Cost of living is obviously important, especially at start up stage, so don't overstretch your budget by including moving costs etc. which are not 100% necessary at this stage. Hope this helps and good luck in your new venture.


Answered 3 years ago

You bring up a couple of interesting points here.

First, the cost of living. This is absolutely a factor, and keeping your costs down when you’re first starting out with your new consulting practice is definitely a sensible idea. Your business may grow more slowly than you hope, or you may have some unexpected expenses, and minimising your spending in the meantime can only be good for your personal and business finances.

Second, your network. Surrounding yourself with people who understand and appreciate the world of working for yourself, people who are ambitious and who will push you and support you, is a huge enabler when you’re self-employed. Finding that ‘tribe’ can be helpful both in terms of business connections and in terms of that personal support network.

Of course, web development and consulting can be an almost fully virtual business, and you can always travel to conferences and business meetings, so to some extent that means that you can work wherever you want. Then it becomes more of a personal decision, taking into consideration the quality of life, the weather, the activities that you can do in your time off, and so on.

I’d suggest you try to list the elements that are most important to you, and clarify which of your criteria are non-negotiable and which are simply ‘nice to have’ - then you can determine the best options. If having face-to-face contact with people who challenge you is the most important factor for you, then I would start by seeking out groups locally and in the cities that you’re considering moving to, in order to see what there is. On the other hand, if the cost of living is the #1 priority for you, then you might rather want to focus on that.

Bear in mind as well that starting a new business can be a time-consuming endeavour, and moving cities at the same time may be taking on a lot - why not start your business now and then once you’ve got a steady income you can consider making your move?

Good luck, and let me know if you’d like to jump on a call to discuss your options with an objective third party :-)


Answered 3 years ago

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