Editor's note: This article is the first part of a series on Utah’s Silicon Slopes. The second part will run Thursday, July 14.
SALT LAKE CITY—Utah continues to surprise outsiders with the level of innovation and tech ingenuity coming from the state.
National media outlets and business leaders have recently taken notice of Utah’s burgeoning tech community, many aptly naming it Silicon Slopes. While some are puzzled by Utah’s tech success, a review of the past helps reveal the state’s pathway to becoming an entrepreneurial leader.
Homegrown Utah unicorn companies such as Qualtrics, Pluralsight, Domo and InsideSales were created from a perfect storm of cultural, political and historical factors — some as far back as the state’s founding. And the storm keeps building, as smaller and mid-sized tech companies begin to take off; BambooHR, Lucid Software, Solution Reach, Boomsourcing, Avalaunch, Brixio and Boombox are among those that may be very well-known in the not so distant future.
The enterprising pioneer
Utahns are used to being unique. The state, founded in the early years of the The Church of Jesus Christ of Latter-day Saints, was settled by people accustomed to a constant state of commotion and relocation. The pioneers who arrived in Great Basin in 1847 brought with them a strong work ethic and stubborn resilience.
“Beyond the business climate, many businesses are started in Utah because of the Mormon influence in our state. There is a nature of self-sufficiency that lives in the culture and is what has contributed to one of the strongest economies in the country and a thriving tech sector,” Josh James, CEO at DOMO commented.
In the early days of the state, Utahns had to be scrappy. They had to either acclimate to an unfamiliar hostile environment — figuring out how to make a desert habitable — or perish. This drive to both survive and create a sustainable culture forced all settlers to participate in the new society's creation.
Jacob Munns, CEO of Boomsourcing, explained that this scrappy mentality has made Utah entrepreneurs better able to bootstrap — having the ability to get their companies to higher valuations — before taking outside investment dollars.
“Utahns, essentially, know how to do more with less,” Munns elaborated.
Kendall Hulet, vice president of product for Ancestry, also commented on the theory.
“I think Utahns have a natural desire to find a way and make something out a tough situation," he noted. "You have these people in the desert building a city, and I just think of that, and a lot of entrepreneurs think the same way. You have to make the best out of a situation from the resources available to them."
The cultural component
This pioneering spirit has been passed down from generation to generation. Early Utah tech companies such as Novell, WordPerfect and Omniture, as well as the University of Utah graduates who helped found Adobe, Atari, and Pixar, laid the groundwork that is enabling Utah’s current entrepreneurs to succeed.
“You couple the second and third generations of entrepreneurs that have been in Utah for 20-plus years with the enthusiasm of these young entrepreneurs just coming out, and it is a nice blending of passion and talent with experience," said Blake Modersitzki, Pelion Venture Partners' managing partner. "These are some of the reasons why Utah has become such an interesting hotbed for tech companies."
Ryan Smith, CEO of Qualtrics, is an example of the phenomenon Modersitzki described.
“My parents decided they were going to become entrepreneurs once they were over 45-years-old. After watching that, I realized that I didn’t need to wait long to become an entrepreneur,” Smith commented. “I think there is a literal awakening taking place as people watch entrepreneurs, similar to when I watched my parents, that make people say ‘this is doable.’ There are a lot of people saying that in the state.”
Clint Betts, founder of Beehive Startups, also explained that Utahns have a healthy distrust for establishment type figures, which has fueled the state’s entrepreneurial spirit. As the state’s history reveals, Utahns are willing to challenge the status quo and find another way.
“A lot of people in Utah believe that a single person can change the course of history," Betts said. "We are brought up being told you should not trust the way things are being done, you should not trust the establishment."
Gavin Christensen, managing partner at Kickstart Seed Fund, noted that entrepreneurship is the great leveler in society.
“Becoming a successful entrepreneur allows you to change classes and solve problems that couldn't be solved in any other way," Christensen explained. "I think that Utah has kept that immigrant culture, one being that because of its historical association with the Mormon church, we have to make our own way here because nobody wanted them."
Many CEOs and venture capitalists alike have attributed the rise of Silicon Slopes to the emphasis universities have placed on entrepreneurship. In fact, most of the successful tech business and VC funds were started by individuals who graduated from Utah schools.
“The level of depth that we have in terms of tech savviness is higher than it should be in Utah," said Aaron Skonnard, CEO of Pluralsight. “I think that this is a result of the good universities we have here, such as BYU, University of Utah, UVU and the others that have developed good programs around software, IT, and tech over the last several decades. This has really produced a healthy number of tech visionaries here within the state.”
BYU graduates: Josh James (DOMO); Ryan Smith, Stuart Orgill and BYU professor Scott Smith (Qualtrics); Aaron Skonnard (Pluralsight); Blake Modersitzki (Pelion Ventures); Gavin Christensen (Kickstart Seed Fund); Ben Peterson (BambooHR); David Mink Co-Founder Avalaunch); Jacob Munns (Boomsourcing); Jim Higgins (Solutionreach).
University of Utah graduates: James H. Clark (Silicon Graphics); Alan Ashton (co-founder of WordPerfect); Nolan Bushnell (Atari); Edwin Catmull (co-founder of Pixar); John Warnock (co-founder of Adobe Systems).
Utah State University graduates: Gregory Carr (Boston Technology and Prodigy); Ward Parkinson (Micron Technology); USU professor Michael Glauser (My New Enterprise).
Universities in Utah have been encouraging this pioneering spirit for decades as well. Nationally, Utah is starting to become more recognized for its rapid development and success.
“If you go back to the '70s and '80s, you saw a lot of early technology development coming out of the U," said Nick Efstratis, EPIC Ventures' Managing Director. "For example, Shane Robison was the CTO at HP who graduated from University of Utah. And then you add on to that, what gets a lot of companies off the ground is people in Utah willing to invest in startups."