Report: Detroit is the Best Startup Ecosystem for Startups
A new report ranks Detroit as the world’s No. 1 “emerging ecosystem” for tech startups, beating global powers including Hong Kong and Brussels.
The 2022 Global Startup Ecosystem Report, released this week by San Francisco-based Startup Genome, a research and policy advisory organization for the startup economy, ranked Detroit as the first local area designated as an “emerging ecosystem.”
The report defines those cities as “startup communities in early stages of development, and our ranking methodology has been adapted to reflect this, to showcase the strengths of these ecosystems that have high potential to be the best performers globally in the coming years.”
The report says Detroit ranks highly on multiple fronts, with available capital as the only area for improvement.
To rank emerging startup ecosystems, the Startup Genome report looked at four different categories:
- Performance, which the report’s methodologies describe as “captures actual leading, current and lagging indicators of ecosystem performance.” Within the performance, the report looked at the overall value of the ecosystem and the exits and overall success of startups in the region.
- Finance, which looks primarily at accessing available capital with an emphasis on early stage capital. The report also places a minimal emphasis on the “quality and activity” of the investor community in the ecosystem.
- Connectivity, which aims to measure “the extent to which an ecosystem is connected to the global fabric of knowledge within an ecosystem.”
- talent within the ecosystem.
Detroit received a perfect 10 in three groups, while it had an 8 in the finance category.
Detroit’s place in the report has been well received this week by various policy leaders on social media and those working in quasi-governmental roles.
“This latest arrangement from Startup Genome highlights Detroit’s explosive growth as a destination for startups and venture capital investments,” said Fred Molnar, senior vice president of entrepreneurship and innovation at Michigan Economic Development Corporation, in a statement. “As Michigan’s economy continues to thrive, we will continue to work to provide the most dynamic environment for startups across Michigan to thrive and succeed.”
Other top-performing local regions for startups around the world include Hong Kong, Dublin, Minneapolis and Houston.
According to the Startup Genome report, the best performing ecosystems in the world are Silicon Valley, New York City, and London, which is ranked second, Boston and Beijing.
Detroit’s nomination as the best emerging ecosystem comes amid a broader market cooling that startup founders and venture capital investors say is starting to hit their economic sector.