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America’s most densely-packed startup scenes aren’t just in Northern California

August 15, 2013
August 15, 2013

If you’re up on trends in high tech startups, and you’re a budding entrepreneur, you should open your first office in Silicon Valley, right? Not so fast: A new report from the Kauffman Foundation, in collaboration with Engine, a policy coalition for startups, used data from the US Census to show that startup-heavy cities are actually all over the place.

More importantly, there are a number of US cities where start-ups are densely packed together, giving rise to an urban multiplier effect for innovation as budding entrepreneurs develop closer social ties that enable the free-flow of information, ideas and opportunities.

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Everything with a value higher than 1 has more startups per capita (in a given census tract) than the US as a whole.(Ian Hathaway/Kauffman Foundation/Engine)

Indeed, if you compare the number of startups in 2010 (the most recent year for which data is available) to the population of all of America’s metro areas, Silicon Valley (here listed as “San Jose-Sunnyvale-Santa Clara, CA) isn’t the even the most start-up intensive area—Boulder, Colorado is more than twice as dense.

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University towns and metros focused on particular industries—including defense and software—dominate this list.(Ian Hathaway/Kauffman Foundation/Engine)

A number of metro areas are on par with Silicon Valley: Seattle; Fort Collins-Loveland, Colorado; the Washington DC metro area; Denver; San Francisco; and the complex of small towns opposite Boston on the Charles River, including Cambridge.

This analysis, which looks at the ratio of startups to population, privileges smaller metro areas where companies are physically closer together, but in as much as density itself fosters innovation, that’s the whole point. It’s not the only measure of importance—clearly, Silicon Valley’s massive venture capital flows dwarf those in Boulder—but it highlights the fact that Boulder and some overlooked cities beyond the stereotypical start-up scenes have some advantages of their own.

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