A look at why Las Vegas, a city with little history and very few natural resources, is the country's hottest spot for start-ups. It produced over 17,000 new businesses in 1997.
Why here? Why now? What makes Las Vegas the ground zero of the new-business boom?
If Rodney Taylor had his way, he wouldn't be starting a business--not now, not ever. "I was pushed to do this," he says.
Taylor, 34, was working as a full-time personal trainer when last November he suddenly found himself unwelcome in two of the gyms where he regularly worked out his clients. In the next three months, he whipped up a business plan for a new health club, rounded up some partners, and gathered up $200,000 in financing. "I got creative," says the president of Taylor Made Bodies, who was scheduled to open his first facility May 15.
If only every inexperienced hothead could so easily amass the resources to get an enterprise going. But for most entrepreneurs there is always more money to be scraped up, more market research to be compiled, another consultant to be overpaid--on this planet, anyhow. Taylor, though, lives in Las Vegas, the country's start-up capital (see " Start-up Almanac"), where last year his was one of 17,662 businesses to get their legs. Ever a domain unto itself (where else can you find a dry cleaner open at 4 a.m.?), the city has now added another dimension to its otherwordliness: you can start a business here just because you feel like it. Or even if, like Taylor, you don't. "There are people starting businesses here who wouldn't start a business anywhere else," says Mary Jane Wirges, an executive vice-president at Hi Tech Health Care Services Inc., which was founded way back in 1990.
Not everybody succeeds, of course. But then, how long could a rare-reptile store survive anywhere else? In a region blessed with precious little in terms of natural resources--nobody's descending into the neon mines--Las Vegas has transformed itself into a world-class manufacturer: the place stamps out entrepreneurs, one after another. "It just happened," says Ron Canosa, who has opened two car-stereo stores in the past two years, much to his own surprise. "We were growing so fast, I couldn't think about where I was going."
He didn't have to--this is Las Vegas. Business happens. "I've never seen so many shopping centers in all my life, with so many people doing the exact same thing: 1,000 shoe-repair places, 1,000 landscapers, 1,000 dry cleaners," observes Canosa, whose company, Audio Excellence Inc., cranked up sales of more than $900,000 last year. "And they are all busy."
Tucked into a valley more than 200 miles from the nearest major city, Las Vegas rises up like an entrepreneurial oasis. The overdose of opportunity has created a laboratory of sorts: When starting a business is made easy, what kind of people become entrepreneurs? What shape do their businesses take? "There's no business model for what I'm doing," says 31-year-old David Lessnick, who started the Custom Cook Inc. in December 1994. "It's a big blank whiteboard." Lessnick did no formal market research before starting his venture, which enables people to rent the services of a professional chef. The company, he claims, posted sales of $300,000 last year, with after-tax profits exceeding 30%. "We have a very healthy bank balance," he says.
He expects it to stay that way. Not that he--nor anyone else lifted and transported by this powerful boom--has got the time to mull over the kinds of questions that any outsider can't help but ask: What, exactly, is going on here? Why is it happening now? In a city where entrepreneurship may soon upend blackjack as everyone's odds-on favorite route to riches, it's only natural to wonder: What's it like to start a business?
This city, part of a county where natives make up less than 20% of the population, is itself a start-up. In Detroit or Philadelphia, folks grouse about the cost of maintaining the decaying downtown areas. Las Vegas doesn't have any old areas; as recently as 1960, you could hardly find it on a map. True, the architecture of some of the casinos harks back to earlier eras but more out of competition than out of any respect for history. Given its gargantuan size, the pyramid-shaped Luxor looks bent on making those puny Egyptian originals obsolete. Casinos are dynamited before they can shuffle into middle age; most recently, the 31-year-old Aladdin got blown away. It's all so disposable.
Then again, the strip--that sparkling fuse of casinos that line Las Vegas Boulevard--doesn't pretend to subscribe to any mythology but one: quick riches. "Cash Your Paycheck and Win $250,000," scrolls the sign outside the Barbary Coast casino. Even the curbside entertainment, from the pirate-ship battle outside Treasure Island to the Mirage's erupting volcano, lasts just long enough to make you stop and explore the Keno cards or slot-machine carousels inside. To the tune of $6 billion a year, the gamblers come and go.
As have entrepreneurs, historically. In the 1940s the overhyped "Bugsy" (Benjamin to you) Siegel built the high-caliber Flamingo Hotel and was plugged with an ordinary .30-caliber for his effort. During the 1960s the underscrubbed Howard Hughes, that aviator-turned-billionaire-turned-germophobic-recluse, ruled the strip from his hotel bed. During the past decade the high-haired Steve Wynn, chairman of Mirage Resorts, has led the way, ushering in the era of themed resorts when he opened the Mirage, in 1989. "Before that, any way that locals could avoid the strip, they'd do it," recalls 36-year-old native Clark C. Peterson, vice-president and general manager of Nextlink Nevada, a phone-service provider. "But when we heard about the volcano, we flocked down there like tourists to watch it explode."
