Around the United States and the world, there are new companies starting up each day. Some businesses serve basic human needs, such as a restaurant, while others are entirely new and aim to innovate an industry. Either way, starting a business can be difficult. Plus, the location that a founder chooses can have a significant impact. With this in mind, we decided to look further into how the startup market varies across U.S. cities by digging into the numbers behind it. In which cities should entrepreneurs consider starting their business?
We looked at AngelList, a leading listing site for startups and angel investors, in order to collect data specifically related to the startup market. We compiled data on the number of companies, number of jobs, average company valuation, and number of investors for each city. The United States metropolitan areas included in our analysis are those with a population of 1 million or more.
First and foremost, we wanted to see which cities have the most startup companies relative to their population. San FranciscoCA is the city with the most per 100,000 people (815.8) as it turns out, which probably won’t come as a surprise. Interestingly, San Jose, CA ranks 6th on our list and is “beat” by Austin TX (202.0), New York NY (131.9), Boston MA (121.2), and Los Angeles, CA (112.3). The cities in the U.S. with relatively few startups are
Next, we took a look at the number of startup jobs available by city. San Francisco CA again earns the top spot, with 324.3 jobs per 100,000 people. This city is followed by New York NY (44.4) and Boston MA (34.8). The cities with the fewest startup jobs are Riverside CA (0.1), Memphis TN (0.1), Louisville KY (0.4), and Hartford CT (0.4).
We also wanted to see what the local landscape is for startups by looking at their average valuation in each city. We found pretty marked differences among cities. San Francisco CA ranks, again, at the top with an average valuation of $5.1 million, followed by San Diego CA ($4.8 mil) and Raleigh NC ($4.8 mil). The cities with the lowest figures are Louisville KY ($2.6 mil), Memphis TN ($2.7 mil), and Cleveland OH ($2.8 mil).
Finally, we wanted to see which cities have the best opportunities for entrepreneurs looking for an investor, so we looked at the number of them available relative to the number of local startups. Riverside CA ranks as the best city by this metric, with 68.7 investors per startup, followed closely behind by Hartford CT (57.6) and Kansas City MO (53.8). San Francisco CA is actually the worst city when looking at this measure (0.2), followed by New York NY (0.3) and Los Angeles CA (0.6).
Even if a city doesn’t rank “best” or “worst,” it’s valuable to have the numbers on it. Look through our analysis and see how your city compares. How did it stack up compared to others on the list?