Entrepreneurship in West Virginia- Hit ‘em where they aint
“I keep my eye on the ball and I hit ‘em where they ‘aint.”- Willie Keeler (Photo Courtesy of the Baseball Hall of Fame)
A couple of years ago, my wife and took a trip to New York City and stayed on 37th Street in the heart of the Garment District. There were fabric stores and wholesale clothing outlets on every corner. Manhattan is made up of dozens of densely packed “districts” where groups of businesses in similar industries are located. There’s the financial district, the fashion district, the theater district, the meatpacking district, the diamond district, and many more. For an entrepreneur, it makes sense to locate a business in one of these districts. New York has the population and the customer base (consumer and B2B) to support thousands of different organizations. However, it’s extremely hard to compete unless your organization already has strong name recognition (not to mention the rent is astronomical).
West Virginia is worlds apart from the bustling streets of Midtown Manhattan. To be fair, Manhattan is worlds apart from almost everywhere in the US, but the largest city in the Mountain State (Charleston) is a mere 0.6% the size of NYC. With a fraction of the population, does it make sense for an entrepreneur to locate their business in WV? With a handful of exceptions, I believe the answer is a resounding “yes!” Appalachia is not known as a mecca for entrepreneurship, but perhaps it’s time to reconsider that notion.
As I mentioned earlier, rent is much more affordable in WV than most large cities. According to loopnet.com, office lease rates in Charleston range from $4 to $22.25 per square foot. In New York, the lease rates range from $8 to $3600 per square foot! While $8 doesn’t sound bad for NYC, that’s for an office on the southern end of Staten Island, well over an hour from the city’s center of business and tourism in Manhattan. For a more comparable location, let’s look at Columbus, OH. Columbus is well known as an affordable, “livable” city. Office lease rates range from $5 to $50 per square foot. The low end of the range is similar to Charleston, but the average lease is considerably higher.
Not all entrepreneurs need office space, so what else can WV offer to business owners? Registering a business in WV is about as easy as it gets. With the WV One Stop Business Portal, you can register a business in less than a half hour. The Secretary of State, Tax Department, Division of Labor, and Workforce WV are all connected through the business4wv.gov website. If you need extra assistance, you can stop by the WV One Stop Business Center in person. The agencies all share an office building on East Washington St. in Charleston. In most states, business formation requires separate registration with the Secretary of State and the agencies that deal with taxation and unemployment insurance.
The most attractive aspect of becoming an entrepreneur in WV may be the lack of competition. Hall of Fame baseball player Willie Keeler said, “I keep my eye on the ball and I hit ‘em where they ‘aint.” Like baseball, entrepreneurship is easier if you operate where there isn’t any defense. Even though physical location is not as important as it used to be because of the internet, it still matters. If you decide to start business in an area where no one else does what you do, it will be easier to stand out to local and regional customers. Zim’s Bagging grew into a successful packaging manufacturer partially because of this principle. Harry Zimmerman, Sr. began making snack food bags and garbage can liners out of the tiny unincorporated community of Prichard, WV in the 1960’s and 70’s. Their first customers? Hospitals and businesses within 100 miles of Prichard. Today, Zim’s is a major producer of flexible packaging with 100 employees.
Positive press is like gold to an entrepreneur- it’s free advertising. It is much easier to get noticed by the local media in WV than places like Los Angeles or Chicago. If you are a tiny fish in an ocean of competition, the media probably doesn’t care. If you are the only fish in the pond, you’re a big deal. J.Q. Dickenson Salt Works has become one of WV’s most beloved businesses by producing- you guessed it- salt. The Kanawha Valley was one of the nation’s greatest salt-producing regions 200 years ago, but the industry faded over time. When Nancy Burns and her brother Lewis Payne revived their family’s long-lost business, the WV business community was thrilled. J.Q. Dickenson is regularly featured in local print and television stories.
Unfortunately, WV’s business climate has a negative perception. The Mountain State regularly ranks near the bottom of “Best States for Business” rankings by Forbes and USA Today. To be sure, there are issues that need to be addressed. Broadband access is poor in the most rural parts of the state, and there is a lack of highly skilled, educated workers. However, those issues are not insurmountable, nor do they outweigh the benefits of becoming an entrepreneur in WV. In Charleston, Huntington, Morgantown, Beckley, and the other population centers of the state, there is ample access to broadband and educated workers. Schools like West Virginia University, Marshall University, and the University of Charleston have invested heavily in innovation programs, and they provide business assistance to the community.
West Virginia has more than 20 small business incubators to help entrepreneurs with access to inexpensive office space and business resources. There are also several Small Business Development Centers which provide free advice and guidance to entrepreneurs. Despite the negative reputation of WV’s business environment, the overall cost of doing business is quite low. WV ranks #13 in business costs according to Forbes, and #22 in business tax climate according to the Tax Foundation. Recent investments by Macy’s, Proctor & Gamble, Northrup Grumman, and Virgin Hyperloop further dispel the perception that WV is a poor place for doing business.
In summary, there are many reasons to consider WV as a prime entrepreneurial destination. Lease rates are low, the tax climate is good, there is a well-developed network of resources, and the competition is minimal in most industries. Perhaps best of all, WV offers incredible outdoor recreation opportunities and a low-key, slow-pace lifestyle that can’t be found in most major cities. No matter where you are in the state, you are only minutes away from hiking, golf, boating, camping, fishing, and hunting. Rafting, skiing, ziplines, and ATV trails are also a short drive from most places in the state. Put WV on your list if you’re looking for a place to launch a new business.
