Las Vegas, which has been laboring to attract more entrepreneurs with the help of Zappos CEO Tony Hsieh, just lost one of its most high profile start-ups to the Bay Area.

On Friday, the Las Vegas-based Romotive--creators of a smartphone-operated robot--announced its plans to relocate. Romotive was among the the first few start-ups Hsieh recruited and invested in as part of his plan to remake downtown Las Vegas and establish a sustainable start-up community in the city.

In January, Hsieh told Inc. that his decision to invest in Las Vegas as a community began with an almost-move of his own. Initially, Hsieh had planned to move Zappos headquarters away from the so-called Sin City, but after speaking to local entrepreneurs Hsieh recognized a greater opportunity to transform the community as a whole.

"We're trying to integrate all the different concepts of what makes a city more productive, and crossbreed them into the company. We're creating this alien hybrid that benefits the city and benefits Zappos," he said.

In a letter thanking the Las Vegas Downtown Project for its constant support, Romotive CEO Keller Rinaudo explained that the decision to relocate had been a difficult one.

"I can’t think of a place I would have rather built Romotive over the last two years than downtown Vegas. It’s also been meaningful to be part of something bigger than ourselves, and we believe deeply that Tony will succeed in building the downtown area into a vibrant tech ecosystem," Rinaudo wrote in a fairwell letter to Las Vegas Tech.

In the end, however, the benefits of being part of the the burgeoning tech community in Vegas didn't trump the resources Silicon Valley offers. He cited the company’s need to work in "close proximity to strategic partners" and hire "brilliant senior talent" as the reasons behind Romotive’s move to the Bay Area.

Las Vegas Tech Fund partner Zach Ware told Pando Daily that the Fund supports Keller's decision to relocate, but he also used the occasion to validate Las Vegas as an effective launch pad for new tech companies. "While here they’ve grown from a team of three to 20, closed a huge round with Sequoia, and written their largest order via a connection made in downtown Las Vegas,” he said.

Published on: Mar 18, 2013