WASHINGTON, D.C.— Boston, Denver, Raleigh-Durham, and San Diego are the best poised American cities outside of the San Francisco Bay Area to find success in the evolving digital economy, according to a new report examining the top 25 U.S. startup hubs.
The rankings are based on how well the top 25 U.S. startup hubs attract talent, increase investments, develop specializations, create density, connect the community and build a culture of innovation.
The Innovation that Matters 2016 report, released today by the U.S. Chamber of Commerce Foundation, the Chamber’s FreeEnterprise.com, and 1776, builds out a one-of-a-kind index comparing key statistics in these cities to show how well they are turning capital into successful tech industries.
To compile the report, researchers visited eight cities—Atlanta, Denver, Kansas City, Los Angeles, Philadelphia, Raleigh-Durham, Salt Lake City, and Seattle—where they met with public and private sector leaders to develop recommendations for how cities can evolve their startup communities. Those anecdotal findings are paired with the results of the 25-city index that cross-references data sets focused on talent, capital, specialization, density, connectivity, and cultural statistics, along with a survey of more than 330 startup leaders.
The cities that ranked highest in the index were able to combine robust startup activity with strong engagement with local anchor institutions. Every city had a bright spot. For example, Baltimore, Pittsburgh, and New Orleans did not rank at the top of the list; however, they are finding ways to attract educated young people, build collaborative innovation communities, and create the right cultural foundation to overcome recent economic challenges.
“We built 1776 to help entrepreneurs succeed wherever they live because we know they need a strong base of support in their communities,” said Donna Harris, cofounder & co-CEO of 1776. “Our research over the past year shows how cities can build that infrastructure and draw on national networks to support not only startups, but the innovative companies that have always powered their regions.”
Innovation That Matters 2016 builds on research outlined in the first Innovation That Matters report, released last year, which shared guidelines for developing startup ecosystems around highly regulated industries. Together, these reports can help guide civic leaders in creating the kinds of connected communities necessary for startups to exist and thrive.
“Chambers of commerce exist to help businesses grow and navigate the changing economy,” said Tom Collamore, senior vice president of communications and strategy at the U.S. Chamber of Commerce. “The insights gained from this research will help guide entrepreneurs and established industries as they work together to create the next generation of great American businesses. Our findings underscore the importance of collaboration among the startup community with corporations, universities, foundations, and local government.”
The report includes never-before-released Mattermark data on initial public offerings and acquisitions. This data helped researchers measure where investments are translating into successful companies. The Bay Area, New York City and Los Angeles led in total number of acquisitions from 2011 - 2016 Q1, but regional up-and-comers like Chicago, Denver and Seattle are also succeeding in building a capital base to reinvest in new companies.
Key Recommendations for City Leaders
- Understand the inevitable trajectory of the digital economy
- Imagine a new future that includes history; where technological possibility intersects with legacy assets and unique strengths
- Focus beyond startups to include corporations, universities, nonprofits and local government
- Work proactively toward a new governing framework that marries technological possibility and regulation
Please click here to download the complete Innovation That Matters 2016 report and methodology, search sharable graphics, examine city-specific case studies and access detailed data tables.
For interviews with local or national spokespeople, please email firstname.lastname@example.org or call 202-463-5682.
Innovation That Matters is a research program designed to identify and explain how to create local innovation economies and leverage entrepreneurial thought to address the major challenges of our time. In its first iteration, Innovation That Matters 2015 showed that successful local innovation economies are collaborative communities that cultivate engaged networks across startups, industry leaders, local government, and investors. Innovation That Matters 2016 builds on this foundation to provide steps local stakeholders can take to unlock the potential in their cities and drive more successful innovation.
1776 is a public benefit corporation that scouts and funds high-growth startups around the world focused on solving society’s most fundamental challenges in sectors like education, energy, transportation and financial services. Launched by co-CEOs Donna Harris and Evan Burfield and headquartered in Washington, D.C., with additional campuses in Dubai and San Francisco, 1776 serves hundreds of startups and institutions worldwide through its innovation curriculum, mentorship, investment and programming. It hosts more than 500 international events per year that attract heads of state, Fortune 500 CEOs, influential investors and global press.
The U.S. Chamber of Commerce Foundation is dedicated to strengthening America’s long-term competitiveness. We educate the public on the conditions necessary for business and communities to thrive, how business positively impacts communities, and emerging issues and creative solutions that will shape the future.
The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.