March 13, 2024

A first look at the state of Sioux Falls’ startup community reveals early-stage entrepreneurs are gaining traction.

Startup Sioux Falls received 20 responses to its inaugural survey, which will be completed annually. The majority were pre-startup and startup phases of business, but one in four are in growth or scaling mode.

“Our biggest takeaway from the survey results is that the work our organization and many others have done to lay groundwork to support a growth-minded startup ecosystem is working,” executive director Brienne Maner said.

“We will continue to keep our finger on the pulse of the greater Sioux Falls startup community through this annual survey and will also track growth of our program participants through more in-depth quarterly surveys. These results also support our program curriculum and offerings.”

Startup Sioux Falls will track the data annually as it aims to help 100 businesses grow by 2034 and will address three key metrics: revenue, profit and number of employees.

On the revenue side, the 20 reporting businesses showed year-over-year growth. Average revenue in 2023 was $922,651, up from $138,203 in 2022. The median revenue went from $0 in 2022 to $63,231 in 2023, reflecting many new startups. Likewise, median profit grew from $0 to $18,000 in 2023. The average profit was $46,761, up from $20,666.

“We saw some year-over-year increases in profit and revenue,” Maner said.

When asked about their challenges, a majority of startup survey respondents pointed to customer acquisition and retention, followed by market volatility and access to funding and capital.

“Our full suite of core programming addresses most of the findings in the survey; we now have programs available to support the entire founder’s journey, from pre-ideation to growth stage with Bootcamp, Co.Starters accelerator and our new Growco growth cohort,” Maner said. “This pipeline of activity also supports the programs of our ecosystem partners through an increase of referrals.”

The top industries represented in the survey were legal, marketing, technology and consulting. Eight in 10 respondents said they connected with the startup community through an online Facebook group, while 60 percent said programs from Startup Sioux Falls had helped grow their businesses.