An emerging technological industry, a $2 billion port infrastructure upgrade, and the state’s lowest commercial real estate vacancy rates have helped strengthen South Florida’s economy and make it a significant place for new businesses. The Miami-Fort Lauderdale recently ranked second in the nation for startup activity, according a recent Kauffman Foundation study.
The ability to create new businesses is key to a strong economy. A solid entrepreneurial ecosystem can create jobs and wealth. Successful startup communities can also inspire local pride as first-year businesses morph into global corporations. Startup companies tend to self-sustain as veteran entrepreneurs mentor young companies.
A strong, diverse Miami economy will only benefit what is already one of the nation’s most dynamic real estate markets. In the prestigious 2015 Knight Frank Wealth Report, Miami ranked as the sixth most important city in the world to ultra-high-net-worth individuals (UHNWI). Miami and New York were the only North American cities to make the top-10 list of the Wealth Report, which is issued annually by London-based real estate consultancy Knight Frank. London, New York, Hong Kong, Singapore and Shanghai rounded out the top-five most important global cities.
Miami’s ability to attract affluent homebuyers is a significant development particularly for local startups as a wealthier population can better fund new businesses, a fundamental key to a thriving economy. Miami’s recent economic developments are enhancing what has long been one of the nation’s most dynamic real estate markets and a perennial hotspot for foreign buyers looking to purchase property.
Kauffman Foundation Study
The Kansas City-based Kauffman Foundation, which develops and funds global research and programs in entrepreneurship, studied the 40 largest metro areas for its 2015 study. It analyzed the rate of new entrepreneurs, startup density, and other factors.
A look at the top-10 large metro areas of startup activity, according to the 2015 Kauffman Index:
1. Austin, Texas
2. Miami-Fort Lauderdale
3. San Jose, Calif.
4. Los Angeles
6. San Francisco
7. New York
9. San Diego, Calif.
10. San Antonio, Texas
Rate of New Entrepreneurs
South Florida creates 520 new entrepreneurs each month, according to Kauffman. The region had the second-best rate of new entrepreneurs in the nation, behind Austin, Texas which creates 550 new entrepreneurs monthly.
Local groups such as eMerge Americas, Endeavor Miami, Venture and the Knight Foundation are helping South Florida create new businesses.
Miami leads the nation by a significant margin in startup density, according to Kauffman. Startup density tracks new businesses rather than entrepreneurs. Miami registered 247.6 startups per 100,000 people, according to Kauffman. New York (197.3 startups per 100,000 people) and Orlando (196.1) finished second and third, respectively, among the nation’s top-40 metros.
Growing Tech Industry
An increasing number of companies, including Microsoft, are working to turn Miami into America’s next tech hub. Venture capitalists and technology incubators have invested in the community and are encouraging more tech companies such as Miami-based social media startup Everypost. Latin American technological companies see Miami as a more accessible economic entry point for business compared to other American cities such as Silicon Valley.
Miami’s annual eMerge Americas, a large-scale technology conference, is growing each year. It focuses on connecting revolutionary startups, cutting-edge ideas, and global industry leaders and investors across North America, Europe, and Latin America.
Major Center for Business
With its proximity to Latin America and the Caribbean, Miami excels in international trade and finance and serves as the base for transactions between North America and the world.
Miami has the largest concentration of domestic and international banks south of New York City, with approximately 87 financial institutions and 33 foreign bank agencies. “The Gateway to Latin America” also has more than 1,000 multinational corporations. More than 600 Miami companies maintain Latin American headquarters. Greater Miami has the third largest consular corps in the nation with 55 foreign consulates, 30 bi-national chambers of commerce and 18 foreign trade offices.
PortMiami is the top-ranked container cargo port in Florida with 900,000 TEUs handled each year. The port has an opportunity to expand its international business as it is deepening its channel from its current 42-foot depth to 50-52. When the deep dredge project is completed, PortMiami will be the only U.S. port south of Norfolk, Va. that can accommodate the new, mega cargo vessels that will pass through the expanded Panama Canal. Miami officials hope the port’s short distance from the canal, as well as $2 billion of planned infrastructure upgrades, including cranes to unload the ships and a billion dollar tunnel connecting the port to major highways, will make the city a more attractive choice for global shippers looking to distribute goods to the U.S. market.