Tag Archives: new-york-city

Where the puck is going

There is a famous quote “Skate to where the puck is going to be, not where it has been.”

In terms of early stage startup activity , I wanted to take a look at which geographies in the United States were getting the most traction from an early stage venture capital deployment perspective. We know that COVID created some displacement and a shift in where early stage startups were being formed. I took a look at data available on Pitchbook to see the leading states , cities and zip codes. Given that I wanted to get the latest trends “where the puck is going” from a geo perspective, I queried all Seed and Series A deals in the 2nd Half of 2023.

From a state perspective, the leaders were:

  1. California : 633 companies
  2. New York: 295
  3. Massachusetts: 128
  4. Texas: 118
  5. Florida: 78
  6. Washington: 74

From a specific city perspective (not metro areas):

  1. New York City: 265 companies
  2. San Francisco: 216
  3. Austin: 64
  4. Los Angeles: 51
  5. Boston: 39
  6. Seattle: 39
  7. Miami: 35
  8. Palo Alto: 33
  9. Cambridge: 28
  10. Chicago: 25

In terms of Zip Codes, this is a good way to measure density:

  1. 94104: San Francisco : 23 companies
  2. 94114: San Francisco: 23
  3. 10013: New York City: 19
  4. 94306: Palo Alto: 16
  5. 10001: New York City: 14

As you can see from the data: California and New York dominate in terms of where early stage startups are being created. New York City is now the #1 city for startup formation. Historically it was San Francisco, but many startups moved during COVID due to several factors, mainly due to strict COVID restrictions and also increased homeless / drug / crime activity. San Francisco is gaining momentum with the surge of AI (artificial intelligence) related startup and Y Combinator (#1 accelerators in terms of exits) being back to in-person cohorts.

I will caveat that although the data is for announced rounds that took place the 2nd half of 2023, many rounds are typically delayed, so they could have taken place 6, 12, 18 months ago, which defeats the purpose of the post, as I wanted to share what is happening now from a geo perspective. Will revisit this post in 6 months and see if the data changes in term of trends.