Pittsburgh ranks 13th in the world as a hub for tech startups

Pittsburgh’s position in the race to attract start-up businesses has improved as early investment continues to move away from Silicon Valley, According to a new report on the growth of international startups.

Genome startup Rank Pittsburgh ranks 13th among the world’s emerging ecosystems in a study released Tuesday, up from 23rd last year. Emerging ecosystems are in the early stages of growth, in contrast to dominant hubs such as Silicon Valley and New York City. Detroit topped the list of emerging ecosystems.

Jason Grace, Ecosystem Manager at InnovatePGH, noted Pittsburgh’s improvement in the rankings It mainly stems from large exits of companies with a large local presenceeven as the relative shortfall in early stage capital continues to hamper Steel City.

In the past year alone, Duolingo, Aurora, Stronghold Digital Mining, and Cognition Therapeutics have gone public. Main collectibles Create additional momentum.

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Rene Rosenstiel

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Duolingo

East Liberty-based language-learning company Duolingo debuted on the market on July 28, 2021 on Nasdaq.

“The basic idea is that startups can stay in Pittsburgh and expand to the point where they can have a successful exit,” Grace said. “And this is an important thing to understand because people often think of Silicon Valley, New York, [and] Boston is big enough from a talent perspective, big enough from an investment perspective, [preventing them from moving] To another city to reach a successful exit.

“I think demonstrating that we can do this here in Pittsburgh is a big part of establishing ourselves as a competitive startup ecosystem.”

Over the past decade, Silicon Valley’s global share of early-stage investment dollars has halved, from 25% to 13%, according to a Startup Genome report. Because this funding is a key indicator of where technology will develop, the researchers said, “this trend suggests that technology growth elsewhere will continue to be faster than it is in Silicon Valley.”

If Pittsburgh can capture more of these gains, Grace said, it will attract a more dynamic range of companies that can attract more workers to the area. studies You have Identifies Digital business models will create the majority of global economic value over the next decade.

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Kelly Kosinski

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90.5 Wesa

The independent car company Aurora is headquartered in the Strip and went public on November 4, 2021, through a reverse merger with a private acquisition company, or SPAC.

“There is flexibility that you get as a community when you have many small and medium-sized and expanding businesses in one geographic area,” Grace said. “People who are already here will find themselves able to access more jobs in and around the technology community,” he added.

He continued, “Not all jobs are integrated software development jobs. And when other companies thrive, the companies that support those companies will also see their boom increase.”

However, Grace noted that start-ups in Pittsburgh tend to have particular difficulty accessing early capital. In fact, the Startup Genome study found that local companies typically raised just $50,000 in seed funding between the second half of 2019 and the end of 2021, 13 times less than the global average of $671,000.

The region has also lagged behind the rest of the world in attracting venture capital, attracting only $1.5 billion of such investments between 2017 and 2021. The international average was $4.5 billion over the same period.


But Pittsburgh has caught up with elsewhere in finance firms that are past the founding stage, according to the new research. It shows that the region’s Series A averaged $4.7 million between the second half of 2019 and the end of 2021, exactly the same as the global average.

“We’re trying to understand how to grow our local investment community at that initial stage so that people don’t have to leave town or look to investors in different places to get this important funding as they’re rapidly expanding,” Grace said. He said InnovatePGH is studying the issue with startup accelerators in the region, university entrepreneurship offices and other business support organizations.

“The key message here is that we’re seeing momentum, we’re seeing growth and momentum accelerating,” he said of Pittsburgh’s No. 13 in the new rankings. “But we’re not done, and there are plenty of opportunities for people to get involved in this business. And if they want to, my door, my phone, and my direct messages are always open.”

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