What’s Working: “Enough is enough!” Local tech and business leaders feel Colorado is losing its competitive edge ...Middle East

Tamara Chuang

Business/Technology Reporter

Quick links: 230+ frustrated tech leaders | State’s strong points | Mixed messages | CSU’s economic impact | More+

A new relocation report from the Colorado Chamber of Commerce wasn’t promoting the reasons companies should move to the state. It wasn’t an appeal for new members. And it certainly wasn’t about the weather.

The 2025 Relocation Tracker report focused on how challenging it has become for businesses in Colorado. It named 98 companies that have left Colorado since 2019 or bypassed the state for opportunities elsewhere. That totaled 13,607 jobs “lost to other states.”

The latest report is part of the chamber’s 10-year plan launched a few years ago to use data and research to figure out how to improve the business climate in Colorado, said Rachel Beck, executive director of the Colorado Chamber Foundation.

The organization hired two economists to help track data. They also looked at other reports like CNBC’s annual ranking of “America’s Top States for Business,” which started in 2007. Colorado was in the top 10 states for 15 years (often in the top 5) until 2023, when it fell to 11th. Then to 16th in 2024. Last year, Colorado was back up to 11th.

From 2022’s finding that “state-level policies have driven some companies to look to other states for expansions,” Colorado today is “lagging behind other states when it comes to key business metrics, from the cost of doing business to cost of living,” according to the report.

“We are the sixth-most regulated state in the country and the rate of regulations is growing at a faster rate than the rest of the country,” Beck said. “We continually hear from our businesses that it’s the volume (of proposed laws). Just keeping up is a big part of the problem.”

230+ tech leaders and investors chime in

The chamber wasn’t the only business group to speak up this week. On Thursday, an unrelated group of 230 local business and tech leaders, wrote an open letter to Colorado’s lawmakers about their concerns that the technology and business foundation built over several decades is deteriorating.

They, too, said the current business climate has founders, CEOs and investors locally and nationwide viewing Colorado as “less predictable and less competitive” so they’re looking elsewhere to expand. The letter mentions the recent departure of Palantir, known for mass surveillance technology aided by artificial intelligence. It moved to Miami in February.

“Enough is enough,” said Dan Caruso as he shared the letter online and a plea to political leaders to “course correct” before Colorado’s reputation becomes a state to avoid. In an interview Friday, Caruso, who cofounded telecom Zayo Group in Boulder and is a investor in local startups and tech companies, isn’t sure he could have done all that today.

Many who signed the letter also opposed the state’s artificial intelligence law, which is set to go into effect June 30. The law was delayed twice and changes could still be made this legislative session. Tech industry opponents say the controversial law, which aims to put guard rails on AI to protect consumers, hurts business by creating a regulatory environment where innovation cannot thrive. On Thursday, the world’s richest person, Elon Musk, sued Colorado over the AI law.

But it’s not just the AI law. Land use and developer restrictions need to be modernized and streamlined to increase housing supply. Municipal and state leaders should work together to attract new companies and headquarters relocations. And there needs to be more public and civil dialog between opposing views to better understand benefits and harms of proposed legislation, Caruso said. 

“The cumulative effect of all of that rhetoric and all of those signals through legislation, the action and inaction, and even how the state and cities are being run, that is really sending a loud message to those who invest that they should be looking to more friendly geographies and Colorado should be classified with the unfriendly geographies,” Caruso said.

Gov. Jared Polis also signed the letter.

Caruso is often the spokesperson for the informal group of dismayed tech executives, investors and founders who are increasingly speaking out against policies and regulations they say hurt innovation. They want to “remove barriers and reestablish Colorado as a preferred geography” for startups, expansions and venture investment.

The thing is, Caruso said, many don’t want to leave Colorado. He has no plans to.

“We love Colorado, and that’s why we’re doing this,” he said. “We’re just hoping to get the right type of attention with our leaders and we keep emphasizing that we want to work with you guys on this.”

What’s working still

Beck said that while the chamber’s multiple reports point to the state losing its competitive edge, it’s not too late to improve with friendlier business policies.

“They’ve identified not just where we need to improve, like this report highlights, but also places where Colorado is doing really well and how we can make sure that we maintain those advantages,” Beck said.

“Some key industries, the technology sector and the aerospace and defense sector are two of those,” she said. “We have a really high concentration of tech jobs in Colorado, which you might not expect given the size of our state or its location. We also have the highest per capita aerospace and defense employment in the country, which you also might not expect.”

She also pointed to a bill moving through the statehouse with bipartisan support. Senate Bill 137 would require state agencies to review existing regulations regularly and determine when rules are outdated, duplicative or create “administrative burdens on the agency, consumers or businesses without a corresponding public benefit.” The bill passed its second committee hearing on Friday.

Closer look at the data

Success stories weren’t mentioned in the recent chamber report. And that seemed to frustrate the Colorado Office of Economic Development and International Trade, which is the state’s economic development arm. OEDIT has a team to mine and attract business prospects.

The chamber’s list of 98 companies were not all straightforward departures.

Some with Colorado headquarters moved existing out-of-state facilities to another state, such as cheesemaker Leprino Foods Company, which started in Denver in 1950. The company closed a plant in central California in November and switched capacity to a new one in Lubbock, Texas, two months later. The reason for the closure? The aging facility, costs to improve it and “high operating costs in California,” The Fresno Bee reported.

Others faced different economic challenges. In 2024, Meyer Burger Technology scrapped plans to open a solar cell plant in Colorado Springs with 350 employees after a key customer went bankrupt. At the time, the European company switched focus to a different product built in Arizona. But a year later, it closed its entire U.S. operation and later filed for insolvency.

And while companies like Techstars, the Boulder-based tech accelerator and investment firm that Polis cofounded, moved its headquarters to New York in 2024 “to be in one of the epicenters of the startup world with more funding, connectedness, talent, knowledge, and market reach,” an outcry by the local tech community resulted in cofounder David Cohen, who lives in Boulder, returning as CEO. The Boulder accelerator is also restarting.

In an email, Eve Lieberman, OEDIT’s executive director, said Colorado has assets that few states have, like top talent, a collaborative ecosystem, research institutions and access to capital. Last year, Kansas City startup Raven Space Systems moved its headquarters to Broomfield and has plans to add 392 new jobs. Aerospace and defense company ITS LLC opted to expand at its Colorado Springs headquarters and add 500 jobs.

And this month, construction-services manufacturer RK Industries moved its headquarters to Aurora, after leaving Denver. The Aurora facility is much larger and the company expects to add 1,200 new jobs this year, according to OEDIT.

“Since 2019, nearly 43,000 jobs are projected to be created by 160 companies that have actively chosen Colorado over other global and domestic markets as a result of our primary state incentive, the Job Growth Growth Incentive Tax Credit. This is in addition to organic growth, relocations, expansions, job creation and investment that occur without state support,” she said. “While Colorado is not immune to national and global headwinds, we are always looking for ways to foster a strong business environment.”

Broomfield economist Gary Horvath, who wasn’t involved in any of the chamber reports, said it’s important to take a look at what the business community is seeing and sharing. Chamber members are local businesses who pay dues and are part of the economy. Their concerns are just as valid as state’s.

In an Office of State Planning and Budgeting report, Horvath noticed state budgets “show minimal job and economic growth through 2028,” he said. Colorado lost jobs last year for the first time since the 2020 pandemic, and before that, 2010.

“They are being transparent, which is good. But if a site selection team reviewed those budgets and the basic economic assumptions used to derive them, they might reconsider,” he said in an email. “Many legislators do not understand the business world. Others do not understand agriculture, or tourism. Lots of people do not understand economic development. Chamber information is valuable.”

Sun economy stories you may have missed

➔ Nexstar asks states, including Colorado, for $150M bond to cover damages from order slowing merger with Tegna. The antitrust case argues the merger of the parents of 9News and Fox31 in Denver gives too much market control to Nexstar, which academics describe as a “news duplicator” >> Read story

➔ BNSF, state reach tentative deal to end 22-year wait for rail service to northern Colorado. One-time payment of around $333M will allow daily round trips between Westminster and Fort Collins, with stops in Broomfield, Louisville, Boulder, Longmont and Loveland >> Read story

➔ Colorado lost jobs and saw its labor force decline last year. Local economists had projected meager job growth in 2025. The state lost 11,700 jobs instead — the first decline since 2010 outside the pandemic losses. >> Read story

➔ This wealthy Colorado community is fighting wildfires with robo-mowers and 1,000 sensors on trees. Can communities beyond resource-rich Cordillera use similar tools in a drought-driven wildfire season? >> Read story

➔ Denver’s lawn-watering costs are going up for the drought. Here’s how much. Chances of “Miracle May” snowstorms are evaporating, leading water agency says >> Read story

➔ With cuts coming to Proposition 123, Colorado’s budget crisis is about to make its housing crisis worse. Colorado’s state budget proposal would cut $130 million from Proposition 123, with most of the money coming from programs that develop affordable rental housing for low-income families >> Read story

➔ You’ve got questions about Colorado’s budget and the state’s $1.5B shortfall. We’ve got answers. From state spending on highways to Medicaid expenditures, we break down the state budget AMA-style >> Read story

Other working bits

➔ CSU’s says its economic benefit is 5.8 times more than its state funding. Job creation, taxes paid and all the spending that goes on to support the Colorado State University System amounted to $1.233 billion to the state economy in fiscal year 2024, according to a new report from the school system. That includes 12,000 jobs, $90 million in tax revenue and more than 50,000 students among CSU Fort Collins, CSU Pueblo and CSU Global (the online option).

State funding was 11% of CSU System’s total revenue of $1.9 billion. But take that $1.2 billion in estimated economic output, that puts the school system’s contribution to the state economy at 5.8 times what it received in state funding, which was $211.6 million, according to the school. Lots more to unpack in CSU System’s impact report. >> Check out the report

➔ JBS meatpackers halt strike to resume negotiations. After three weeks, the 3,800 union members at the JBS meatpacking plant in Greeley paused their walkout over unfair labor practices and planned to return to work Tuesday, as United Food and Commercial Workers Local 7 resumed negotiations with the company. But JBS said a return to work could not be instant and provided a staggered schedule as the plant ramped back up to full capacity. Several members of Congress, including Democratic U.S. Sen. Bernie Sanders, asked JBS management to address worker concerns and find resolution on a fair contract. As of Friday evening, there was no movement on a new contract, according to the union.

➔ UPDATE: 526 workers at beverage distributor expected to retain employment. After our deadline last week, What’s Working heard from Southern Glazer’s Wine & Spirits, which acquired Eagle Rock Distributing Company in Colorado. Eagle Rock had notified the state labor department last week that it would lay off all 526 employees at its facilities in Monument, Grand Junction, Loveland, Pueblo, Commerce City and Durango. Eagle Rock distributed Anheuser-Busch products, including Budweiser, Beat Box Beverages and Phorm Energy.

In an email this week, Southern Glazer’s chief human resources officer Amy Kickham, said this: “We are aware of reports regarding the status of Eagle Rock Distributing Co. of Colorado. As part of Southern Glazer’s announced acquisition, our intention is to retain employees and continue operations. The reports suggesting widespread job losses or closures are not reflective of our plans.”

➔ New office for engineers and tech builders opens in Centennial. Step One 2 Launch unveiled a 22,000-square-foot “innovation hub” Thursday that isn’t your typical coworking space. But it’s also not your legacy office format. Instead, the facility, at 7060 S. Tucson Way, is meant for those innovators who need a place to “design, prototype and scale complex products in one place” but prefer the professional polish an industrial warehouse can’t provide.

It will “bridge the gap,” said cofounder Kenneth Geyer in a news release. Geyer and cofounder Tom Scott also founded Liteye Systems, a Denver developer and manufacturer of unmanned defense systems. Liteye, also in Centennial, was acquired in 2022 by a private investment firm. The new SO2L space, near the Centennial Airport, has engineering suites, antistatic flooring, server infrastructure and shared assembly space to build prototypes. >> Details

➔ 2 fraudsters sentenced for stealing pandemic unemployment from Colorado. The U.S. attorney for the District of Colorado said Wednesday that a federal judge sentenced Ikponmwosa Erhinmwinrose, 39, and Nyerhovwo Presley Agbure, 34, both from Georgia, for stealing millions of government benefits offered during the pandemic. Erhinmwinrose, accused of stealing $7.6 million from the pandemic Paycheck Protection Program as well as Colorado’s unemployment program, was sentenced to 17 years in federal prison. Agbure, a coconspirator, was sentenced to 57 months.

The two men and other conspirators operated a fraud ring that used the stolen identities of more than 1,000 victims. Victims received letters in the mail that they had to start repaying the loans even though they had not received any money, according to the U.S. Attorney’s Office. >> Details

Got some economic news or business bits Coloradans should know? Tell us: cosun.co/heyww

Thanks for sticking with me for this week’s report. Got a tip? Let me know at cosun.co/heyww. ~ tamara

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What’s Working is a Colorado Sun column about surviving in today’s economy. Email [email protected] with stories, tips or questions. Read the archive, ask a question at cosun.co/heyww and don’t miss the next one by signing up at coloradosun.com/getww.

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