Park City is known for its annual Sundance Film Festival and great skiing. But for its entrepreneurs, it's the place where you can build a fast-growing business and live an outdoors lifestyle.
The city's population of about 8,000 is 100 times smaller than that of San Francisco, but it's also home to businesses whose annual revenue exceeds six figures. Two Park City startup success stories include action-sports audio-equipment maker Skullcandy and recreational equipment retailer Backcountry.com. Both have made the annual Inc. 5000 fastest-growing private U.S. companies list in recent years--five and four times, respectively.
How did Park City become a startup hotspot? Locals point to its proximity to the tech hubs of Salt Lake City and Provo, both less than an hour's drive away, and its large number of angel investors with deep pockets. What's more, its concentration of skiing, snowboarding, and adventure sports enthusiasts have made Park City a hub for this growing business niche.
Events like Sundance are a boon to Park City, because they attract aspiring entrepreneurs who might never have thought of the location, says Ted McAleer, a co-founder of Park City Angels, an angel-investor network. "We have a 'work hard, play hard' mentality, and a really interesting, vibrant, entrepreneurial community," McAleer says.
For Skullcandy, the company's Park City location is an integral part of its identity, says CEO Hoby Darling. One of Darling's first moves as CEO in 2013 was to close the company's Los Angeles office to focus operations back to Park City. Skullcandy, which went public in 2011, now has about 175 full-time employees at its headquarters.
"We had to be really aligned to our consumer, and to do that we really had to have product, marketing, and sales altogether in one building," Darling says. "When you go, 'Who is the customer that I just love wearing Skullcandy?'...I think a lot of that goes right back to our heritage. It's people who are on the mountain. They're in the park. They're in the gym, pushing what they love to do."
Salt Lake City and Provo both boast growing startup scenes and a ready population of programmers. "Park City is unique because it has a really large talent base of engineers located nearby," says Eric Cylvick, co-founder of ZipRider, a company that installs zip lines, mostly at ski resorts.
For ZipRider, the city offers the best of both worlds. The business, founded in 2002, has more than $1 million in annual revenue. Park City is home to both a ski resort that was large enough to support a Zip Rider zip line (Park City Mountain Resort, which was Zip Rider's first customer), but is also close enough to a talent pool of developers and engineers that Zip Rider needs.
One downside, says Park City Angels Chairman Paul Wozniak, is that when companies reach a certain size, they tend to outgrow the tiny local labor market and have to move. Take WAVE, a startup that's helping cities develop wireless electric buses. WAVE moved to Salt Lake City in 2013 after it outgrew its Park City facilities.
Park City does have one advantage over Salt Lake City and Provo: It's home to Park City Angels, the largest angel-investment network in Utah with 45 dues-paying members who invested $6.55 million in Utah startups in 2015.
Further evidence of the mountain town's robust startup scene is its new business incubator and accelerator, PandoLabs, which launched with the help of Park City Angels. PandoLabs now works with 50 startups in the area.
"We're seeing a number of entrepreneurs who were already in Park City, but who now want to be part of a larger community," says McAleer.
Ready test market.
For companies like ZipRider and Skullcandy, Park City is home to their ideal product testers.
Eric and his wife and co-founder, Sarah Cylvick, got the idea for ZipRider after returning from a trip from Costa Rica where they went zip lining. Their home--located in the mountains--was high up enough that they built a 550-foot zip-line prototype, which allowed them to perfect their product before pitching it to ski resorts.
The idea for Skullcandy's first set of headphones was also born on Park City slopes. Darling says that it's important that Skullcandy's products are able to withstand use while snowboarding and skiing. With the headquarters of the U.S. Ski Team in Park City, Skullcandy can get input from athletes like two-time Olympic skier Emily Cook. Cook joined the company after ending her athletic career, becoming a manager of Skullcandy's Sport and Human Potential Program.
Park City's seasonal events also provide an ideal way for aspiring entrepreneurs to recruit out-of-town customers without leaving the state. Friends Josh Mahoney and Jake Jones founded the transportation company Chariot Enterprises in 2010, after chauffeuring at the Sundance Film Festival for four years. As Mahoney explains, working at Sundance for so long allowed them to start a business with customers who were already loyal.
"I had a really good relationship with one of the clients I was assigned to--their coordinator really liked me," Mahoney said. "I mentioned that they could just hire me directly. From there, we just kept getting new clients."
Mahoney says that when he was working as a chauffeur for Sundance, he would earn about $2,000 a week. Last year, Chariot did about $100,000 in sales--all while Mahoney and Jones kept their day jobs as a restaurant manager and a nurse, respectively. Not bad for a side hustle.