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Council Post: Utah’s Highly Successful Tech Scene Highlights The Importance Of Tech Ecosystems
Davis serves as CEO of Canopy, the award-winning cloud-based practice management platform servicing accounting professionals.
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“What’s going on in Utah?” This is a question that many people who follow tech have been asking for nearly a decade now as they’ve seen the amount of successful large public and emerging tech companies coming out of a small state located in a “flyover country.”
Public tech or tech-adjacent companies from Utah include Qualtrics, Pluralsight, Vivint, Domo, Overstock, Instructure, Weave, Traeger and Owlet, as well as the recently acquired Divvy, now part of Bill.com. Other large companies that could go public in the next few years include Podium, MX, Entrata, Lucid, TaxBit, Nomi Health and Route. Still others in the Series A-D segment include Pattern, Lendio, Awardco, PDQ.com, Zonos, Neighbor, Aumni, GuideCX, Spiff, Rivet Health and my company, Canopy. This list is far from exhaustive.
This steady drumbeat of success out of Utah seems to elicit a single reaction from many tech folks on the coasts: “Utah?” They then want to know why—which is why once a quarter or so, a reporter for a major magazine, newspaper or outlet will fly to Salt Lake City to try to find some answers.
After dwelling on a few of Utah’s cultural quirks (“Dirty soda shops!” “Instagram influencers!” “Fry sauce!”), these stories usually center on a few theories centered on the predominance in Utah of the Church of Jesus Christ of Latter-day Saints (often referred to as the Mormon church). “They’re good at selling because they served missions for their church!” Or, “They get married early and have lots of kids so they buckle down early in life and need high-earning sales careers to maintain their families!”
As fun as these theories are, I don’t believe they explain the emergence of Utah’s tech scene. The answer, in my opinion, is actually much simpler: Utah had a unique blend of the ingredients necessary to build a tech ecosystem and did the work to turn those ingredients into what we see today.
By an ecosystem, I mean a large, interconnected network of people who have access to other people, knowledge and capital. It’s sort of like the old “Six Degrees from Kevin Bacon” game; in an ecosystem, you’re one or two degrees from anything you’d need—a seed investor, a key hire, a reference check for said key hire, an advisor with the specific expertise you lack and so on.
While it’s possible to build a company and a career outside of an ecosystem, it’s much, much easier and faster to do so inside of one—and more fun, too. In fact, anytime I talk to someone early in their career, my number one piece of advice is to embed themselves in an ecosystem. Career-wise, it means there will be lots of opportunities for them, that they’ll be aware of them through their network and that they will have someone who can recommend them. This goes for building a company, too. In an ecosystem, the people and the capital you’ll need to build your company will be present and accessible to you.
Utah’s tech scene is an ecosystem in the best sense of the word. It’s big enough to offer an abundance of the necessary resources—people, capital and expertise—for building companies and careers. However, in spite of its size, it’s still highly interconnected and bound by close personal and professional relationships from working and collaborating together, which makes accessing those resources quick and easy. Finally, there’s a massive commitment to the ecosystem among most people; the vast majority of people in Utah’s tech ecosystem are willing to help someone out without any vested interest other than a desire to help and to create a stronger ecosystem.
What were the ingredients in Utah that resulted in a strong tech ecosystem? The first was a few early wins. Decades ago, Utah-based pioneering tech companies like Evans & Sutherland, Novell, WordPerfect and Omniture achieved scale and success. These companies enabled the people who worked at them to build personal networks and accumulate capital from exits, which they, in turn, leveraged to start a whole host of new companies.
These companies were able to take advantage of an abundance of technical, sales and entrepreneurial talent, Utah’s business-friendly environment and a growing Utah-based venture capital community. All of this was spurred on by the creation of the Silicon Slopes organization, funded and built by community-minded leaders. Utah’s tech leaders and employees worked hard to turn these elements into our current incredible tech ecosystem.
Of course, you can build a company or a career outside of an ecosystem. It’s just easier and faster to do it inside of one, especially for early-career professionals trying to build their careers. Find your way to an ecosystem and embed yourself there. Connect into the networks of that ecosystem and then use those networks to help yourself and others build a career or a company—or both. That’s what’s happened in Utah, and we’re just getting started.
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