Las Vegas got it's start because of the gambling money, but it has maintained itself as nationally relevant over the years despite it's inhospitable weather and isolated environs due to low taxation but also because of the "hands off of business" stance that the state has taken which is helpful to a diversity of industries other than just gambling, ask Zappos CEO about it.

In my opinion it's not a terrible choice of a place to launch a startup either because you could poach employees away from both the Bay Area and LA job markets by showing them what kind of spacious luxury highrise accommodations they could be enjoying for similar money to what they spend on their 600square foot rental in the City. The fact that they'd pay no state income taxes just makes the job offer all the more enticing. I suspect there's going to be more of this kind of thing going on in the future especially as Zappos continues to invest significant funds into renovation of certain districts.