On Wednesday, a new report from research firm Startup Genome ranked Pittsburgh's startup ecosystem as No. 23 in its 2021 GSER global list of Emerging Startup Ecosystems study.
In that report, which included an analysis of 275 regions globally for the ranking of top 30 overall ecosystems and top 100 emerging ecosystems, Startup Genome found that Pittsburgh has created $5 billion in ecosystem value and has seen $180 million in total early-stage funding over the past two-and-a-half years. The firm also found that Pittsburgh's median Series A funding round reaches $3.4 million, and its average software engineer salary is $81,000, both surpassing the global figures of $3 million and $44,000, respectively.
Those figures, among many others, have major implications for those who are looking for a place to build and grow a company, according to Rich Lunak, president and CEO of Pittsburgh-based investment and business expertise group Innovation Works.
"I think for entrepreneurs, you want to build a company in an ecosystem with the greatest chance of building a successful company and (this report) really highlights globally where those locations are," Lunak said. "There are also areas where investors probably frequent the most, and lastly, as a policymaker or people focused on how we can do better, I think it gives a good indication of not only where we're doing well but where some gaps and things are…there's a part of me that looks and says there's no reason why Pittsburgh can't be one of the top five, certainly one of the top five U.S. entrepreneurial and tech hubs and certainly get higher on those global rankings, we got a lot of all the right ingredients."
Lunak said the findings in the report go beyond being of interest to those who are just looking to start a company, though. Investors and economists are also taking note of what Pittsburgh has to offer, Lunak said.
"Virtually every major think tank and thought leader on the U.S. economy and world economies agree that regional economies are driven by strong startup ecosystems and we sometimes forget that every large company starts out as an idea with an entrepreneur and a risk-taker and an innovator," Lunak said. "I think (the report) really underscores a lot of the key value drivers in our regional tech ecosystem in areas like robotics, AI, lifesciences."
Mark Anthony Thomas, president of the Pittsburgh Regional Alliance, also celebrated Pittsburgh's unique offerings and potential for startup founders and investors alike to tap into.
"I think we're a niche market and I think that you have people, companies that are looking for the big, consumer, 10-million-plus metros and we're not trying to be that," Thomas said. "What we're really focused on doing is being really good at new technologies and R&D-driven innovation. For startups that are looking across the globe for places like Pittsburgh or Waterloo or Boston, we want to make sure that we're on that shortlist."
Late last year, a coalition of local civic leaders unified under the InnovatePGH name joined the Startup Genome network, alongside Innovation Works and the Pittsburgh Regional Alliance, to better provide more accurate information to the firm's data collection and ranking process. The hope, at least according to the group's Executive Director Sean Luther, is that that collaboration will only improve Pittsburgh's standing on the global stage as a home to those looking to make the next great company or investment.
"That's really important because Pittsburgh is unique," Luther said. "We wanted to make sure that the report wasn't just talking about the City of Pittsburgh, which accounts for the lion's share of our startup activity but certainly not all of it, that our founder and funder information was making its way into the data processes, and I think it's been a really valuable process and it pays off with kind of the way we're seeing ourselves increase in the rankings, and we'll be more excited next year because, with the way that we are interpreting their metrics, we're going to see Pittsburgh continue to rise very rapidly through the list of global emerging ecosystems."
