Salt Lake City is rapidly changing. It used to be a traditional city in every sense of the word, and it’s now changing its face – culturally, and economically. It is now a business-oriented city, with an undeniable surge in entrepreneurial activities.
The Salt Lake City Tribune even called Utah the “Startup State”.
Surge in Entrepreneurial Activity
In 2023, Utah saw a significant increase in small business applications, with numbers rising nearly 9% from the previous year to 71,262 applications. Salt Lake County led this growth, jumping from 23,263 to 26,690 applications.
Booming Startup Scene
Recent funding rounds highlight the city’s growing influence in technology and innovation. In April 2022, laundry services marketplace SudShare secured a $10 million seed round, enabling it to expand operations to 500 cities nationwide. Similarly, in March 2023, Lilac Solutions, focusing on lithium extraction from Utah’s Great Salt Lake, raised $145 million in a Series C funding round. Backed by Breakthrough Energy Ventures, the investment supports efforts in sourcing lithium for electric vehicle batteries.
Prominent startups like Pluralsight, an online learning platform valued at over $3.5 billion, and Domo, a data integration cloud platform valued at approximately $2.28 billion, underscore the city’s thriving tech ecosystem. Additionally, Marq (formerly Lucidpress), a significant player in design software, contributes to this dynamic environment.
Robust Venture Capital Support
The startup growth in Salt Lake City is bolstered by a strong venture capital presence. The Kickstart Fund, a seed-stage firm based in the city, has invested in over 150 companies since its inception. Similarly, EPIC Ventures, specializing in early-stage tech investments, provides crucial support to startups in the region.
State initiatives further enhance this support. Utah’s Innovation Fund aims to boost local startups and retain investments within the state, focusing on ventures with long-term potential that might be overlooked by traditional investors. And it’s all governmentally supported. USTAR (Utah Science Technology and Research Initiative) offers competitive grants and entrepreneur support programs to translate ideas and research into marketable products and companies.
Financial Services Sector Growth
The financial activities sector remains a cornerstone of Utah’s economy, significantly contributing to the state’s GDP. In 2021, it was among the top industries driving economic growth. Employment in this sector in the Salt Lake City metropolitan area reached approximately 63,900 individuals as of October 2024, marking a 0.8% increase from the previous year.
Major financial institutions have established a strong presence in the city:
- Goldman Sachs offers services across various financial sectors.
- Wells Fargo provides a wide range of banking, investment, and mortgage products.
- Fidelity Investments offers investment management and brokerage services.
- Zions Bancorporation, headquartered in Salt Lake City, serves over a million customers under multiple brands.
- Varo Bank relocated its headquarters to the city in 2020.
- Morgan Stanley operates a branch offering financial services.
Challenges Amid Growth
Despite the positive trajectory, some businesses have faced economic pressures leading to closures. Small businesses like Les Madeleines, a renowned bakery, closed after 19 years due to factors like inflation and labor shortages. Additionally, Armstrong Teasdale announced the closure of its Salt Lake City office in 2024, and the U.S. Securities and Exchange Commission decided to close its regional office.
Like all American small businesses, interest rates are carrying a heavy burden and is a leading factor in the demise of failing businesses. Bank loans cost about 7-8% a year now, with bad credit business loans costing up to 40% APR.
Cultural Transformation
As a part of the regrowth and rebrand of Salt Lake City, the city is becoming more inclusive, with a growing LGBTQ+ population and a decline in residents identifying with the LDS Church, fostering a diverse social environment. The cultural scene is vibrant, featuring a diverse culinary landscape and an expanding arts community.