Top 10 entrepreneurial ecosystems in North America

By Kate Birch
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Which cities or regions offer the best conditions for incubating innovation and startups? We chart the top entrepreneurial tech locations in North America

Which cities or regions offer the best conditions for incubating innovation and startups? From access to tech talent to incubator programs, we chart the leading entrepreneurial tech locations across North America, ranked by ecosystem value

10: Austin

Ecosystem value US$17bn

Ecosystem overview One of North America’s fastest-growing cities, ranking third in its density of high-growth companies and sixth in its rate of job creation (Surge Cities Index), Austin has been a hot relocation city for tech talent from the Bay Area during the COVID-19 pandemic. Oracle and VC firm 8VC are both moving their HQ to Austin, while Tesla founder Elon Musk is building a new Cybertruck factory here.

Startups have a wide range of market opportunities and access to capital, especially in cleantech and cybersecurity. Austin is home to the University of Texas’ Clean Energy Incubator, one of the longest-established energy and cleantech incubators US-wide, and is home to successful cleantech companies Energy Curb and Banyan Water.

With Austin selected for the new US Army Futures Command, designed to modernise the Army and invest in science, tech, and engineering, cybersecurity startups are booming, with identity and access management provider SailPoint and anti-fraud platform Spycloud already successes.

Notable startups Unicorns include workforce management solution Workrise ($1.97bn) and e-commerce platform EverlyWell ($1.3bn).

09: Toronto-Waterloo

Ecosystem value US$17bn

Ecosystem overview This Canadian corridor is home to the second largest technology cluster in North America, delivering a density of corporations and talent with 15,000 companies and 300,000 tech workers. Access to funding is generous with Canada’s government forming a $1.26bn Strategic Innovation Fund for startups, the province of Ontario allocating $350m to help develop AI, 5G, autonomous vehicles and other technologies, and corporations like Google and Uber setting up AI R&D centres here. CIFAR, the Vector Institute, and Waterloo.ai all drive local AI investment.

Life sciences’ startups are prolific thanks to the rich pool of talent (30,000+ professionals in Toronto contribute $2bn to the economy) and the MaRS Discovery District, which supports commercialisation with local hospitals and is home to the JLABS incubator with 49 early-stage life science firms. 51 Canadian companies are now on track to become unicorns, a 20% increase on 2020 (2021 Narwhal List) with the majority Toronto-based.

Notable startups Unicorns include edtech platform ApplyBoard ($1.4bn) and electronic health records platform PointClickCare ($4bn).

08: Miami

Ecosystem valuation $18bn

Ecosystem overview Miami is fast becoming a symbol for the tech exodus from Silicon Valley thanks to higher quality of life and attractive tax rates, and is home to many investors, successful tech founders and organisations, including The Knight Foundation, 500 Startups which invests in fledgling startups, and SoftBank which recently announced investment of $100m into Miami-based startups.

With one of the most diverse talent pools in North America, and the most African-American and Hispanic engineers in the US, Miami has a high level of Latino entrepreneurship and one of the highest percentages of immigrant-owned businesses. Life sciences and edtech are startup strengths. The Cambridge Innovation Center houses 250 life sciences startups and a wet lab for early-stage biotech startups, with Miami successes including biotech firm Biscayne Neurotherapeutics, acquired for $185m in 2018. EdTech is also strong with 40+ edtech startups, and other strong sectors include travel/hospitality, health tech, blockchain/crypto, fintech, and supply chain tech.

Notable startups Unicorns include car parking platform ParkJockey ($1bn), cybersecurity startup Appgate ($1bn) and IT infrastructure management solution Kaseya ($2bn).

07: Chicago

Ecosystem value $21bn

Ecosystem overview Chicago stands out in the US startup landscape for its women-led startups with women owning and running one third of the city’s startups, supported by programs such as WiSTEM from Chicago’s Technology & Entrepreneurship Center. Chicago is rich in university support with the Illinois Institute of Technology, Northwestern University and the University of Chicago each operating startup incubators and programs in entrepreneurship and computer science.

AI, Big Data and Analytics dominate with Chicago home to 14,000 tech firms employing 340,000 people. Fintech is also strong due to Chicago’s position as the US’s largest central business district and home to Chicago Stock Exchange and eight Fortune 1000 financial services firms. The City’s ChicagoNECT program includes initiatives like the Blackstone Inclusive Entrepreneurship Challenge, ThinkChicago, and a Fintech Committee.

Notable startups These include unicorn AI firm Tempus ($8.1bn), online lending platform Avant ($2bn) and software enterprise Relativity ($3.6bn).

06: Washington DC

Ecosystem value $21bn

Ecoystem overview Due to its proximity to government, Washington DC startups have easy access to funding, contracts, customers and experienced talent, including In-Q-Tel, a non-profit investor that accelerates the development and delivery of technology to the American intelligence community. Cybersecurity is a priority therefore with the region boasting 2.5X more cybersecurity startups than the global average, with these firms drawing on a regional population of cyber-related engineers three times larger than the rest of the country combined.

DC-based Lavrock Ventures is a prolific investor in cybersecurity and national security early-stage startups here. The city’s edtech ecosystem is also ripe thanks to the many government agencies and influencers, including the Office of Education Technology at the US Department of Education, as well as strong edtech supporter Novak Biddle Venture Partners.

Notable startups Unicorns include cybersecurity firm Tanium ($9bn), AI software enterprise Icertis ($2.8bn) and brand builder Vox Media ($1bn).

05: Seattle

Ecosystem Value $96bn

Ecosystem overview With tech giants like Microsoft and Amazon headquartered here, Seattle has landed numerous spinoffs (Expedia and Twilio, to name but a few) giving it the unique position of boasting many startups that become scaleups. Seattle has a higher proportion of tech workers than almost anywhere else US-wide, has seen the most economic growth of all US cities in the past decade, according to WalletHub, and has a growing number of accelerators and incubators – think Techstars Seattle and Pioneer Square Labs.

Seattle startups brought in $3.2bn in VC through the first three-quarters of 2020, with healthcare, AI, enterprise software and gaming booming. AI investment and innovation is ripe with Google investing $10.5m in AI marketplace Algorithmia, Apple hosting a Seattle AI hub, and the Allen Institute for AI contributing to advanced innovation. With medicine programs at the University of Washington consistently topping US rankings, and Seattle HQ home to Bill & Melinda Gates Foundation, biotech startups are well-supported, including Silverback Therapeutics, which raised $78.5m last year.

Notable startups Unicorns include trucking network Convoy ($2.75bn), sales enablement platform Highspot ($2.3bn), and CRM integration platform Outreach ($1.33bn).

04: Los Angeles

Ecosystem Value $96bn

In recent years, many startup successes have emerged from Los Angeles, including Snap, Tinder and Bird, providing a deep pool of experienced founders, employees and investors. There’s a rich pool of talent here thanks to Southern California’s 11 research universities, including Caltech and UCLA; plenty of accelerators offering mentorship and funding including Techstars, Grid110 and PledgeLA (a collaboration of 80+ VCs and entrepreneurs aiming to increase diversity in tech); and a proliferation of early-stage VC funds.

Ecosystem overview Strong sectors include adtech, gaming, health tech and e-commerce marketplaces, with major gaming developers headquartered here, including IPO-ready unicorn Scopely ($3.3bn). Life Sciences is strong too with the startup scene employing 122,000 people, and the city housing Amgen, the world’s largest biotech company and 10+ Life Sciences-focused incubators.

Notable startups Boston unicorns include micro-mobility company Bird Rides ($2.4bn), media firm Skydance Media ($2.3bn), e-commerce marketplace GOAT ($1.75bn), and space startup Relativity Space ($2.3bn).

03: Boston

Ecosystem value $96bn

Ecosystem overview Home to a buzzing startup ecosystem, with emphasis on supporting early-stage companies, Boston boasts 50+ accelerators and incubators, including global early-stage programs like MassChallenge. With its generous R&D tax credits, Boston attracts research-intensive firms from other states, while institutions like MIT and Harvard deliver world-class talent. Advanced manufacturing and robotics are strengths here with robotics firms employing 4,700+ people, and successful startups include unicorn metal 3D printer developers Desktop Metal.

Biotech and cleantech startups (1,100+) are strong too supported by seven teaching hospitals and MSLC’s $1bn Life Sciences Initiative, offering research grants, accelerator loans, and tax incentives. In 2018, Moderna launched the largest Biotech IPO globally valued at US$7.5bn.

Notable startups Unicorns include OutSystems ($9.5bn), restaurant management system Toast ($4.9bn), DNA printing platform Gingko Bioworks ($4.2bn), and cyber platform Cybereason ($1.5bn).

02: New York

Ecosystem Value $147bn

Ecosystem overview Diverse and cosmopolitan, New York is home to 73 Fortune 500 companies, 2.3m people with bachelor’s degrees, 9000+ startups, 22 unicorns and 100+ accelerators, incubators, bootcamps and co-working spaces. It boasts the highest number of AI and machine learning positions in a single metro area and recent five-year growth in AI and Big Data VC funding is higher here than the Bay Area and Boston.

Cybersecurity is a billion-dollar industry in New York with 100+ companies, 6000+ employees and startup successes like password manager Dashlane. Public-private initiative Cyber NYC offers startup accelerators, bootcamps and the Global Cyber Center, an ecosystem that connects the city’s largest economic players to cutting-edge cybersecurity solutions.

With nine academic medical centres, 50+ hospitals, 100+ research foundations, and New York institutions receiving circa $2bn in NIH R&D grant funding, life science-focused startups are well-supported including Schrodinger, which had a successful IPO in 2020.

Notable startups These include decacorns like robotics firm UiPath ($35bn), which recently listed, and creative tools platform Squarespace ($10bn) as well as unicorns including biopharma firm Roivant Sciences ($9.09bn), real estate platform Compass ($6.4bn), and media company BuzzFeed ($1.7bn).

01: Silicon Valley

Ecosystem value $677bn

Ecosystem overview As the epicentre of the future of technology, with 2000+ tech firms including most tech giants (Google, Adobe, Facebook, Airbnb), Silicon Valley remains a vibrant place for startups with an innovative, collaborative and risk-taking environment that’s brimming with experts, mentors, product fairs and capital. Silicon Valley tops most sub-sector rankings, from AI to robotics to life sciences, and churns out most of the world’s unicorns, with 96 in 2019. There’s plenty of talent here thanks to Stanford and UC Berkeley, and generous capital, numerous investors and mentors.

Seven of the world’s top 10 AI investors, organisations like Google and Apple, are based here, with Microsoft investing $1bn in Open AI in 2019, Databricks raising over $65 million in 2019, and Snowflake Computing raising $478m in 2020. Fintech is strong here too with Stripe now a decacorn ($95bn) and set to go public.

Notable startups Other notable decacorns include online grocery platform Instacart ($39bn), mobile banking app Chime ($14.5bn), online trading app Robinhood ($11.7bn), which recently caused Wall Street chaos; as well as unicorns Automation Anywhere ($6.8bn) and Reddit ($6bn). And with a long history of innovation in life sciences, Silicon Valley is home to 1,400 life sciences firms employing 82,000+ people, with successful startups including Vir Biotechnology.

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