No other Silicon Valley in sight, report says – Crunchbase News

Through Alberto Onetti

Is Silicon Valley losing its advantage? Are we seeing an exodus of tech workers and companies from Silicon Valley? Where is the next Silicon Valley?

These have been the most asked questions in the Bay Area for some time and especially during the pandemic.

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In seeking to answer these and other questions, Watch out for the bridge dug even deeper into the Crunchbase database to collect more data points. The result is the new “Tech Scaleup Silicon Valley” report that was presented on September 15, 2021, at the opening of the Scaleup Summit in San Francisco.

Here are some answers, and there are more in the report.

Relax. There’s no other Silicon Valley in sight

No ecosystem in the world realistically has the potential to close the gap with Silicon Valley. The Bay Area is home to 7,894 scaleups; tech companies that have raised over a million dollars since their inception. Elsewhere, it takes a whole continent or a country like Europe or China to provide similar numbers. Silicon Valley has about 5 times more scale-ups than Israel (the “Startup Nation”).

The gap is even greater in terms of investments. Bay Area-headquartered Scaleups has raised $ 501.3 billion in capital, which is about half of the total capital made available to U.S. tech companies. This is about 2.6 times more than the amount raised by their European counterparts ($ 195.5 billion) and 1.1 times higher than China ($ 468 billion).

Source: Mind the Bridge and Crunchbase, Tech Scaleup Silicon Valley, 2021 report.

Are startups leaving Silicon Valley?

More and more tech startups are leaving California. Large companies have also taken the plunge.

Behind this choice are several factors: The insane cost of living, followed by intense competition for hiring, excessive state regulation and high taxes on personal income.

New York, the Los Angeles County area, Boston and Cambridge, Austin (and Texas in general), Seattle, Atlanta, Chicago, and the North Carolina Tech Triangle have seen large-scale population increases over the years. for the past three years. Figures for Seattle and Chicago show a 45 percent increase, New York, Boston / Cambridge and Texas about 40 percent, while Atlanta is in the 30 percent growth range.

Does this mean that technological democratization is underway in the United States?

Not really. Dominance of the Bay still seems formidable.

Silicon Valley hosts 2.3 times more scaleups than New York, 4.6 times more than LA, just under 7 times more than Texas, 8 times more than Boston / Cambridge and 11 times more than Seattle and Chicago. Atlanta and Miami are not yet of comparable size.

Investments in scale-ups in Silicon Valley are 4.9 times higher than in New York, about 7 times higher than in Los Angeles, a little less than 7 times that of Austin, more than 10 times higher than Boston / Cambridge and Austin, and over 30 times more than other hubs.

No hub can compete with Silicon Valley in terms of tech giants. The eight hubs host a total of 16 super scalers compared to 59 in the Bay Area.

Source: Mind the Bridge and Crunchbase, Tech Scaleup Silicon Valley, 2021 report.

Looking for startups? Follow the companies

The centrality of Silicon Valley is also confirmed by the large contingent of companies from around the world who have set up their innovation outpost in the Bay Area: according to our latest dedicated study, 319 of the Fortune 500 / Forbes 2000 companies have a stability presence of innovation (many have more than one outpost). While there is no doubt that the COVID-19 epidemic has had effects on the medium-term engagement of these companies (we have seen a few “retirements”), for the most part, the data shows that both the number as the size of these business units is growing steadily. No other hub in the world has such a concentration of corporate innovation hunters.

In the end, rumors of the supposed “death” of Silicon Valley seem to be greatly exaggerated, according to the data. It is unlikely that a single hub can reach the density levels of the Bay Area. Nonetheless, there will likely be multiple clusters in different locations (US and overseas) capable of exceeding critical mass. But there is no new Silicon Valley in sight.

Alberto Onetti is president of Watch out for the bridge.

Keep up to date with the latest rounds of fundraising, acquisitions and more with Crunchbase Daily.

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