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In compiling Kiplinger's latest search for the nation's top cities we focused on places that specialize in out-of-the-box thinking.
"New ideas generate new businesses," explains Kevin Stolarick, the research director at Martin Prosperity Institute and our numbers guru, who evaluated U.S. cities for growth and growth potential. "In the places where innovation works, it really works," he says.
In researching our 2010 Best Cities, it became clear that there are three elements to the innovation factor. Mark Emmert, the new president of the NCAA, put his finger on two of them: smart people and great ideas. But we'd argue that it's the third element -- collaboration -- that really supercharges a city's economic engine.
When governments, universities and business communities work together, the economic vitality is impressive.
And it's no coincidence that economic vitality and livability go hand in hand. Creativity in music, arts and culture -- plus neighborhoods and recreational facilities that rank high for "coolness" -- attract like-minded professionals who go on to cultivate a region's business scene.
The 10 cities on our 2010 Best Cities are not just great places to live, they're also great places to start a business or find a job.
Here's a closer look at the cities:
1. Austin, Texas
Austin is arguably the country's best crucible for small business. The city offers a dozen community programs to help entrepreneurs. Overlay that network with a dozen venture capital funds, about 20 business associations, incubators, educational opportunities and networking events. Mix these elements in what many call a classless society -- where hippie communalism coexists with no-nonsense capitalism -- and you've got a breeding ground for start-ups.
Don't discount the fun factor: In the self-proclaimed live-music capital of the world, music and business creativity riff off of one another. The city's famous South by Southwest festival, where concerts, independent film screenings and emerging technology overlap, is a prime example.
2. Seattle
Rain City? We say Brain City. It's home to a well-educated work force, a world-class research university and such über-innovators as Microsoft (MSFT, news), Amazon.com (AMZN, news)and the main aircraft production facility for Boeing (BA, news). (Microsoft owns MSN Money.)
Seattle boasts a host of risk-taking, garage-tinkering entrepreneurs, and the city crackles with creative energy. "We only have two products here: smart people and great ideas," says Emmert.
3. Washington, D.C.
Every tourist knows postcard D.C., home to the White House, the U.S. Capitol and all those free Smithsonian museums. But those who live in D.C. know better.
The region is chock full of job prospects, entertainment venues and great neighborhoods, and it is booming. Eleven of the 25 richest counties in the U.S. are located in the region, which also boasts a low unemployment rate.
4. Boulder, Colo.
Boulder is a wealthy, intellectual hot spot where environmental and scientific ideas blossom into businesses.
Three economic drivers power Boulder: the University of Colorado, federal research laboratories and more than 6,600 small businesses and corporations. The city is also a mecca for those seeking healthy, active lifestyles.
5. Salt Lake City
You can't beat the cost of living and doing business in Salt Lake City. Utah has relatively low wages, taxes and operating costs. Plus, it doesn't hurt that, in the words of one local employer, "our offices are 15 minutes away from four ski resorts."
