WASHINGTON, DC – In the 2015 Venture Capital Report released Wednesday, Boston broke into the top three metropolitan statistical areas for the first time, overtaking perennial front-runner San Jose. But the San Francisco Bay area continues to remain on top. Ann Arbor-Ypsilanti MSA tops in Michigan.
Nationwide venture investors deployed capital to 3,662 companies located in 133 Metropolitan Statistical Areas (MSA) in 2015.
The news comes from MoneyTree Report by PricewaterhouseCoopers LLP and the National Venture Capital Association, based on data from Thomson Reuters.
Michigan MSA’s making the Top 133 Include:
Ann Arbor – 24th, 25 deals, 22 companies, total investment $221 million
Detroit – 37th, 16 deals, 14 companies, total investment $78 million
Grand Rapids – 53rd, 5 deals, 5 companies, total investment $12 million
Kalamazoo – 66th, 4 deals, 3 companies, total investment $4.2 million
Lansing – 77th, 2 deals, 2 companies, total investment $6 million
Nationally, Venture Capitalist in the San Francisco-Oakland-Fremont metropolitan area invested $21 billion in 797 companies in 2015. For the third year in a row, the New York-Northern New Jersey-Long Island, NY-NJ-PA MSA had the second largest number of companies receive venture backing with 416 startups attracting $7 billion.
Solidifying itself as a prime location for innovation and venture capital investment, for the first time ever, the Boston-Cambridge-Quincy, MA-NH MSA broke into the top three with 348 companies receiving $5.6 billion.
Displaced by Boston out of the top three, the San Jose-Sunnyvale-Santa Clara, CA MSA had the fourth largest number of companies receive venture capital investment with 321 startups receiving $6.2 billion. For the 16th year in a row, the Los Angeles-Long Beach-Santa, Ana, CA rounded out the top five destinations for venture capital investment with 240 companies receiving $4.5 billion in 2015.
“Contrary to popular belief you don’t have to be an entrepreneur living in San Francisco, New York or Boston to receive venture capital funding. There are pockets of innovation all across the United States, and as long as you have a groundbreaking idea with high-growth potential you are well positioned to attract venture capital funding to help grow your business,” said Bobby Franklin, President & CEO of NVCA. “As more cities, states and municipalities dedicate greater resources to foster the growth of their local ecosystems, venture investors are taking notice and deploying capital across much larger areas of the country. This not only helps the entrepreneurs themselves but local economies as well through job creation and sustained economic growth.”
Top MSAs for Ecosystem Growth since 2010
Measuring the compound annual growth rate (CAGR) of number of companies receiving venture capital funding since 2010, the Charlottesville, VA MSA has experienced the greatest growth of its ecosystem at 55.2 percent. Nine companies in the Charlottesville, VA MSA received $27.7 billion in venture funding in 2015 compared to one company receiving $250,000 in 2010. Interestingly, the Charlottesville, VA MSA has also experienced the greatest rate of growth as measured by venture investment dollars with a 156.5 percent increase since 2010. The Oklahoma City, OK MSA logged the second greatest rate of growth by number of companies receiving investment since 2010 with a 51.6 percent increase and eight companies receiving venture funding in 2015. The MSA to record the third largest growth rate since 2010 is the Rochester, NY MSA which experienced a 43.1 percent increase with six companies receiving venture investment in 2015. Rounding out the top five MSAs to experience the greatest rate of growth since 2010, the Chattanooga TN-GA MSA came in fourth with a 38 percent increase and Memphis, TN-AR-MS in fifth with a 34.5 percent increase.
Click here to download venture investment by MSA data.
