How to Open a Business in Miami
The glitzy, buzzy, nightclub LIV is the kind of place that typifies the apex of the Miami business scene. It has a reputation for being elite with its guest list but liberal with enticing celebrities to get through the doors. And its location inside in the Fontainebleau Resort ensures that its attractive design is surrounded by world-class amenities and imbued with the beachy resort vibe.
Even in the saturated Miami nightclub market, LIV opened in 2008 to great acclaim. By this year, it had hosted the Lady Gaga New Year's Eve party and named the second best club in the world in Reuters ranking.
All of that didn't happen by accident: the owners of the hotel had years of experience in the fickle, transient Miami business scene that helped them navigate a serious business enterprise in a bacchanalia-filled tropical playground.
"Here's the thing about Miami: It's one of those key-marketing, jet-setting spots in the world," says Dave Grutman, operating partner of Miami Marketing Group, which operates LIV and other clubs across the country. "Your game better be very on, especially in Miami."
Running a successful business in Miami can be tricky in the city's saucy climate, where a multi-ethnic and multi-national population mixes with a heavy influx of tourists all year long.
But Miami, nicknamed The Magic City for its seemingly overnight growth spurt at the turn of the 20th century, has its appeal, and its current growth is tapping in to some of that magic in new ways 100 years later. Business experts offer these inside tips to riding the wave of the Miami vibe:
Starting a Business in Miami: Understand the City's Allure
Last year, CNN listed Miami as one of the best cities in the country to launch a small business start-up. The small business growth rate between 2004 to 2007 was 6 percent, higher than the national average of 5.3 percent for metro areas. Even though the population growth was relatively small — just 3 percent between 2003 and 2008, compared to a 6 percent average for all metro areas — the city has been fostering small businesses at a high rate. Miami was home to more than 172,000 businesses with fewer than 50 employees in 2007; the national average was only about 78,000. Per-capita income was $43,123 that year, more than $2,000 above the national average.
Part of the reason for that growth, business owners say, is the year-round warm weather that makes a February in Miami as pleasant as a summer day in the Northeast. The climate opens up the doors for any kind of businesses to expand, lure new employees, and keep a steady flow of customers while always showing off the natural allure of Southeast Florida.
"We're not limited in any type of growing environment within the business climate," says David Coddington, vice president of business development for the Greater Fort Lauderdale-Broward Alliance, a public-private economic development partnership. "It's an all-year-round business growing climate."
On top of the weather, the Florida tax rate is considered one of the friendliest to businesses in the country. Compared to places like California, New York, and New Jersey, a decision to move to Miami can be akin to an automatic 10 percent increase in revenue, according to the alliance.
"Taxes aren't taking a big toll," says Ron Drew, the alliance's vice president of marketing and communications.
The industries attracted to Miami lately include clusters of wireless communications companies such as Motorola and Blackberry Research in Motion. And more recently, there's been an early boom in bioscience and medical research. Due to the area's reputation as an international hub with several shipping ports and airports nearby, aviation also has become a top industry.
"Any company that's interested in exporting finds it a benefit to be here," Drew says. "The ability to go international or fly domestic is a real strength."
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Starting a Business in Miami: Know Where to Look
A big benefit of doing business in Miami right now is a wealth of available real estate space for offices and commercial ventures.
A construction boom earlier this decade resulted in a lot of properties that are now being converted to live-work spaces, says Susan Amat, executive director of The Launchpad, which helps foster entrepreneurs and start-up companies out of the University of Miami.
Economically disadvantaged areas such as Liberty City and Overtown have seen success luring businesses with tax breaks and other incentives at the city and county level to start jobs and open new enterprises, Amat says. Developers and property owners are often keen on accepting first-time entrepreneurs, she says.
"People take risks in Miami," she says. "Lots of people get incredibly good deals. There's a lot more opportunities for people to find really competitive prices."
While much of the population still lives out in Miami Beach, Fort Lauderdale or other surrounding areas, the downtown area is starting to become more populated as new mixed used development opens. A two-million square foot University of Miami Life Science and Technology Park is under construction near downtown, with the first building expected to open in early 2011. Business experts expect it will attract a new wave of bioscience, technology and research jobs and workers.
"Everything you need will be centrally located," Amat says.
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Starting a Business in Miami: Embrace the Diversity
Miami is a hot spot for new immigrants coming from Cuba, Haiti, South America, and other places in the Caribbean. The diversity of the city can be a challenge for businesses that have to learn how to communicate across several different languages and cultures. Sometimes a business will want to print its materials in not just English and Spanish but often Haitian or other languages, Amat says.
Businesses hoping to appeal to Miami's diverse population can look for any of the myriad cultural business groups in the region such as the South Florida Hispanic Chamber of Commerce or the Dominican International Chamber of Commerce for help, she says.
Locating in Miami also gives a leg up to any company that wants to do business in South America or the Caribbean, Drew says. "They see it as a strength that their employee base can deal with a diverse customer base," he says.
Many workers in Miami are used to speaking two or three different languages, which helps grow an international company, he says. "We don't see it as an issue," Coddington says of the city's cultural mix. "We see it much more as an advantage."
The region also attracts a mixed bag of student populations. The University of Miami has a reputation as a top private institution (at No. 47, it was the highest ranked Florida school on the 2011 U.S. News and World Report ranking of U.S. colleges), but nearby Miami Dade College is the largest university in the country by student population size. That's led to a lot of growth in the education sector, Amat says, from education materials to student services.
"It doesn't feel like a college town, but at the same time there are a lot of people going to college in Miami," she says.
Jeff Klein, vice president of food and beverage at Fontainebleau, says the resort has been successful by being cognizant of the diversity of its customer base. It reflects that by hiring a multi-ethnic staff and having people available to translate menus if necessary, Klein says.
"Our South American travelers find it very easy to travel to Florida," he says.
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Starting a Business in Miami: Be Stabile Amid the Temporary
One of the added challenges of Miami is the fluid nature of the population — both tourists and residents — that can make it difficult to build up a loyal following right away.
Nightclub owners are perhaps the most aware of this: Tomas Ceddia had experience working with clubs in Chicago and New York before deciding to open the Electric Pickle in the Wynwood Arts District of Miami about two years ago. But spreading the word about the new club was more difficult in Miami than he'd ever experienced before.
"You have to be so aggressive here for people to notice you. Most people are coming in and out, they're on vacation, they're here for a weekend," he says. "Things don't grow organically the way they do in other cities. Here, you kind of have to put it out in a big way."
A lot of nightclubs and other entertainment venues rely heavily on hired promoters or major online campaigns through Facebook and Myspace to build interest, he says. "Because of the transient nature, you have to be constantly reinforcing what you do," he says. "You're always looking for the next generation."
Even through the recession, the tourism industry continued to draw crowds, which local business owners say has been an encouraging sign of the area's appeal.
Two new cruise ships will soon be in operation in nearby Fort Lauderdale, the 6,296-passenger Oasis of the Seas and the similar-sized Allure of the Seas, both which will be the largest cruise ships in the world.
"Where we live is where people come to vacation," said Amy Evancho, president and CEO of the Florida Economic Development Council.
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Starting a Business in Miami: Additional Local Resources
Business experts in Miami say the city is rife with resources that can provide guidance or even venture capital for new businesses, and several that cater to specific niche elements of the marketplace:
The Launch Pad at the University of Miami is the entrepreneur and innovator center at the University of Miami, which offers free workshops open to the community.
The Beacon Council is Miami-Dade County's official economic development partnership, focused on generating investments to the community, while helping businesses expand.
The Neighbors and Neighbors Association provides technical assistance to small businesses in Miami-Dade County and services to businesses in underserved communities.
The Women's Business Development Center provides certification to women-owned businesses in to make them available for corporate procurement opportunities.
The Miami-Dade County Department of Small Business Development works to increase the participation of small businesses on county contracts.
The Miami-Dade Business Site offers resources, guides and links to business forms and operations that can be done online.
The Florida Small Business Development Center Network is a statewide economic development partnership between higher education and other organizations dedicated to providing entrepreneurs and businesses with assistance.
Score Miami Business Plan Consulting offers free business advice and online workshops.
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