Four Low-Cost Business Hubs To Launch Your Startup In

Every day, it is estimated that around 137,000 business startup dreams take flight, many hoping to reach the dizzying heights of the world’s largest contenders. However, of those 137,000, around 120,000 are doomed to fail; their dreams forever grounded.

The competition for startup businesses is undeniably fierce, and getting your startup up and running is not just about your good idea, it’s also about determination, grit and survival. There are many things out there that can derail a startup before it really gets going, a lack of funding being public enemy number one in startup land.

People may be the beating heart of an organisation, but the fuel that keeps that heart beating is money. Money keeps the startup’s blood flowing, the ideas moving and the business developing. Those doomed 120,000 startups, however, will know that money can run out all too quickly, leaving you to simply wonder, what if? There are some things you can do though, to help your funding go further and potentially keep your startup going long enough to start being self-sustaining.

Many startups choose to try set up in large business hubs like London or Silicon Valley, yet these locations are known for being all-consuming money sinks, sapping the funding out of your startup faster than you can blink. The reasons for starting a business in these hubs are obvious. The community, the infrastructure, the business opportunities; yet none of these are going to matter if your business can’t survive its first year. There are, however, other options available when it comes to hubs of business, cities with great infrastructure and opportunities that come at a much lower price tag:

Warsaw, Poland

Warszawa wieczorna panorama miasta

VAT: 23%

Corporation Tax: 19%

Staff: £12,000

Rent: £385

Utilities: £119

Coffee: £2

The capital of Poland, this historic city is a up-and-coming startup haven, featuring a rapidly growing community of domestic and international small businesses. Interest in the city has been steadily increasing over the years, thanks to its thriving universities and the low costs of operating business in the city. While tax may not be significantly different from the likes of London, the cost of living, working and hiring definitely is — office rent is notably cheaper than London, at around 25% of the price.

An international hub, Warsaw is in a prime location to trade and communicate with the rest of Europe, with a central location only a stone’s throw away from major economic powerhouses. Home to a vast array of banks, big businesses and interest from foreign investors, there are also a huge amount of opportunities to gain investment as a startup in Warsaw.

With a strong economic infrastructure, an army of talent available, strong links with other countries and cheap operating cost, Warsaw is the perfect hub for European business.

Kuala Lumpur, Malaysia

Kuala Lumpur, Malaysia city skyline.

Kuala Lumpur, Malaysia city skyline.

VAT: 6%

Corporation Tax: 23%

Rent: £430

Staff: £8000

Utilities: £63

Coffee: £2

The gateway to Asia, Kuala Lumpur sits in prime position, not only for business with Japan, Singapore, China, Korea and India, but also Australia to the south as well. The cost of living here is very low, as is the cost of doing business, playing right into the hands of any startup looking to drastically reduce costs.

Kuala Lumpur is known for having a diverse culture made up of a range of nationalities, making it the perfect place to test new startup ideas. The startup community here is also surrounded by a lot of buzz and excitement, and has been especially active within the last few years.

One of the biggest draws to Kuala Lumpur is the opportunity for expansion once a startup takes off. With so many other hubs of business on your doorstep, packed full of their own markets and investment opportunities, startups are able to easily branch out and expand once their business begins to pick up steam.

Beijing, China

Central Business District is located in east of Beijing, it is very buse place.

Central Business District is located in east of Beijing, it is very buse place.

VAT: 17%

Corporation Tax: 25%

Staff: £7,500

Rent: £750

Utilities: £50

Coffee: £3

To say Beijing is a city only just starting to find its feet may seem a bit strange, considering it’s the capital of one of the wealthiest nations on Earth, but when it comes to startups and entrepreneurship, it’s relatively new to the game. The Chinese culture of traditional work is starting to fall to the wayside as the country evolves and changes. Startups are on the rise in the city, and with a rise in popularity comes a rise in interest and investment opportunities.

While all of China may be accepting the new startup culture, with the government offering a number of financing and support opportunities – Beijing is where the action really is. A thriving financial hub, with a business infrastructure to rival even New York, Beijing is the place to be in China when looking for business community and investment. The stats really do speak for themselves, and Beijing is beaten only by Silicon Valley when it comes to the volume, and value, of startups in a single area.

The benefits are clear, few places in the world can rival the opportunities available in the world’s third largest city, and with low operating costs to boot, Beijing truly is a viable alternative for startups.

Melbourne, Australia

Melbourne skyline looking towards Flinders Street Station. Australia.

Melbourne skyline looking towards Flinders Street Station. Australia.

VAT: 10%

Corporation Tax: 30%

Staff: £29,000

Monthly Rent: £850

Utilities: £125

Coffee: £2

Melbourne is not the cheapest city in the world to start a business in — even if it does come out lower than Silicon Valley, London and New York, etc, on price. What it does have in its favour though, is a list of benefits that outweigh its slightly increased cost over the other cities on this list.

First off the bat, you have the cultural similarities. British entrepreneurs heading to Australia to start their business are going to find they face little in the way of changes when it comes to settling in and understanding the people they are doing business with. Melbourne itself is also a young city, full of young talent and new businesses. As a result, there are plenty of incubators, business networks and investment opportunities to help a business evolve.

The economy in Australia is also considered very strong, with a constant upward-trend defying all expectations. Let’s not forget that while Melbourne a good city for young business, it is also a beautiful one to live in too. With a lively culture, a stunning location, and a famously laid-back atmosphere, there are plenty of reasons to relocate to Australia. A strong and cheap(ish) place to do business and an enviable place to live.

Note: Rent is an average, per month, for a city center with one bedroom. Utilises include water, heating, gas, electricity, and internet and is costed per month for a one bedroom property. Staff costs are measured in average wage packet per annum for the city, and coffee is a real, black coffee, no fancy lattes.