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Why Boulder Is America's Best Town for Startups

The Colorado hotspot is the top U.S. destination for new tech companies largely because of a bottom-up revolution led by entrepreneurs

On a recent morning, a half-dozen young software engineers hunched over laptops at The Cup, a café on bustling Pearl Street in downtown Boulder. They were holding an informal meeting about a social networking app they're developing and seemed to be on a first-name basis with the parade of techies walking through the door.

An influx of entrepreneurs like these has changed the face of this Colorado city of 98,000, making it a destination for Internet startups. With the University of Colorado as an anchor and a backyard full of mountains as lifestyle bait, Boulder now has the highest concentration of software engineers per capita in the nation. It's second only to Silicon Valley in percentage of workers employed in tech, according to the American Electronics Assn. Best-selling author and urban development expert Richard Florida says it has the greatest concentration of the "creative class"—scientists, artists, engineers, and the like—in the U.S.