Ranking US metro areas by VC invested and returns

Ranking US metro areas by VC invested and returns [interactive maps provided by PitchBook via link]

By Dana Olsen March 19, 2018, PitchBook

The Bay Area has long been known as the Holy Grail for startups and venture capitalists. Over the years, it’s attracted a flood of founders looking for funds and investors searching for big payouts.

But while the San Francisco and Silicon Valley strongholds still attract more venture capital than almost any other part of the country, other metro areas are gaining on them. Boston, Atlanta, New York and Chicago are among the regions that have brought in billions over the last several years—and they also all experienced major jumps in VC invested from 2016 to 2017.

Startup Port’s note: We are biased in our views about Chicago. Interestingly, it is still referred to as a “fly-over” destination between the coast. But slowly both startups and investors are discovering that the cost of starting and doing business in the Midwest and Chicago may be lower than the East or the West Coast. There is also plenty of young, hungry talent from the many high caliber Universities and even from the corporate world. Hopefully this discovery will entice more startups and investors to keep a closer eye on the Chicago startup ecosystem.

Below is an interactive map of the top metro areas in the US, ranked by VC investment from 2010 to 2017. Hover over any number to see total VC invested in the corresponding region during that time period, plus capital investment during 2017 and the YoY change:

(We have selected only the first 10 MTAs, for a full interactive list of all 17 MTAs use the links provide below) 

US metropolitan areas by VC invested: capital investment during 2017 and the YoY change:

1. San Francisco-Oakland-Hayward, CA: 144.3B, $26.6B Invested in 2017: -1% YoY
2. New York-Newark-Jersey City, NY-NJ-PA: 54.5B, $12.6B Invested in 2017: +37% YoY
3. San Jose-Sunnyvale-Santa Clara, CA: 52.8B, $8.5B Invested in 2017: +32% YoY
4. Boston-Cambridge-Newton, MA-NH: 45B, $9B Invested in 2017: +36% YoY
5. Los Angeles-Long Beach-Anaheim, CA: 29.3B, $4.9B Invested in 2017: +13% YoY
6. San Diego-Carlsbad, CA: 12.6B, $1.9B Invested in 2017: No change YoY
7. Seattle-Tacoma-Bellevue, WA: 11.6B, $1.7B Invested in 2017: +6% YoY
8. Chicago-Naperville-Elgin, IL: 10.6B, $2B Invested in 2017: +60% YoY
9. Washington-Arlington-Alexandria, DC-VA-MD-WV: 9.6B, 1.5B Invested in 2017: +29% YoY
10. Austin-Round Rock, TX: 8B, $1.1B Invested in 2017: +21% YoY

Hover over any number in the interactive map below to see the data:

Interactive map link to 17 MTA: https://pitchbook.com/news/articles/the-bay-area-beyond-ranking-us-metro-areas-by-vc-invested-and-returns-interactive-maps

Pitchbook has also created also created a visual representation of the top US metro areas ranked by return for investors (calculated by PitchBook as multiple on invested capital, which is exit value/total VC raised). As you can see from the two data points, there is a correlation. The regions that produce the best returns for VC investors are almost all among those that pull in the most venture capital. The exceptions? Miami and Houston are both among the top metro areas in terms of VC invested, but not in terms of return for backers. For Boulder, CO, and Raleigh, NC, the opposite is true.

Ranking according to Multiple On Invested Capital (exits) in the same top 10 areas:

1. Chicago-Naperville-Elgin, IL: 8.5X
2. Seattle-Tacoma-Bellevue, WA: 5.9X
3. New York-Newark-Jersey City, NY-NJ-PA: 4.8X
4. Los Angeles-Long Beach-Anaheim, CA: 4.7X
5. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD: 4.7X
6. San Francisco-Oakland-Hayward, CA: 4.6X
7. Atlanta-Sandy Springs-Roswell, GA: 4.4X
8. San Jose-Sunnyvale-Santa Clara, CA: 4.2X
9. Denver-Aurora-Lakewood, CO: 3.6X
10. Austin-Round Rock, TX: 3.4X
11. Dallas-Fort Worth-Arlington, TX: 3.4X

Hover over any number in the interactive map below to see the data:

Interactive map link to 17 MTA: https://pitchbook.com/news/articles/the-bay-area-beyond-ranking-us-metro-areas-by-vc-invested-and-returns-interactive-maps

All information listed above is from PitchBook. Links provide direct access to PitchBook data.