Vancouver cheaper than other cities to launch a tech company, says report

Among 50 U.S. and Canadian markets, the cheapest place to start up a tech company is Vancouver, says a new report.

It costs about $24million US a year to cover employee salaries and rent in Vancouver, says a report by CBRE, a commercial real estate firm. That's less than half the most expensive place cited; the San Francisco Bay area, which costs $57million US, the report noted.

All figuresin the report are in U.S. dollars.

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The main reason for the lower pricesis because the average salary of a tech worker in Metro Vancouver is $79,402.That's $34,000to $44,000lessper year than similar jobs in Seattle and San Francisco, the cities measured with the highest wages.

CBRE Research Director, Colin Yasukochi saidthe lower start-up costs inVancouverare due arepart to the lower Canadian dollar, favourable immigration policies, and lower rental rates, compared to some major U.S. tech centres.

"I think there's a better supply demand balance in Canada with regard to the account workforce and the demand for it," said Yasukochi.

"Yes our salaries are lower, so that's attracting big anchor companies to come here, because A we've got quality talent, and B, it's a reasonable place to set up shop," said Allison Rutherford, Executive Director of HR Tech Group, whichconductsa yearly salary survey of the B.C. tech industry.

Healthy wage ecosystem

Nels Anderson, a game designer in Vancouver, saidthe lower Canadian wages may attractcompanies, but theyalso pushaway senior workers, encouragingabrain drain.

"It's how markets work. The market pays what the market pays, and if nobody else in town is going to increase the wages ... then that's the offer you get here," said Anderson.

"As soon as you want to start a family here in Vancouver, it's like okay, can you do that on $30,000 to $40,000a year less. When the cost of living here is basically the same as San Francisco, that's not really an option."

Both Yasukochi and Rutherford say the currentconditions won't last. AsVancouver's tech sector and reputation grows, salaries will likely increase.

"I believe that as more and more companies discover the high quality of tech talent in Vancouver, then the relative value of the wages will start to go up," said Yasukochi.