Venture capital investment slumped last year — except for emerging tech markets like Florida.
Nationally, venture capital investors pumped $238 billion into U.S. startups in 2022 — down 31% from 2021's record haul of $345 billion, according to Pitchbook Data Inc., a firm that tracks venture funding totals across the country.
However, some states were the exception. That included Florida, where startups raised $6.8 billion in 2022 compared to $6.6 billion in 2021.
Here's a closer look at how each state fared for venture capital investment in 2022:
In the Tampa Bay region, $543.7 million was raised in 2022, which fell in the middle of the pack for the Sunshine State. Miami brought in $5.4 billion, with Orlando raising $477.1 million. While the Orlando area had the lowest funding among the three regions, it did see the biggest year-over-year increase with a 14% jump from 2022.
In addition to Florida, North Carolina, Illinois, Michigan and Virginia each saw funding upticks in 2022. Markets like Orlando, Miami and Raleigh drove those gains.
Their growth comes as traditional startup hubs often saw funding fall precipitously from 2021.
California, which draws the most venture funding by far, posted a 35% decline — from $162 billion in 2021 to $104 billion in 2022. New York (down 40%) and Massachusetts (down 37%) posted similar declines.
Those three states account for the vast majority of startup funding historically. But whether it's the rise of remote work, the migration of people to states with a lower cost of living or the growth of nontraditional startup hubs that allow entrepreneurs the freedom to build venture-backed businesses outside of Silicon Valley, the stranglehold California, New York and Massachusetts once had on the innovation economy is starting to give ground to other areas of the U.S.
But the momentum in Florida has held strong and will continue to thrive, according to some experts, including AOL co-founder Steve Case. He also founded VC firm Revolution and founder of the Rise of the Rest fund, which invests in startups outside of traditional tech hubs.
"All the ingredients are clearly there to get Tampa Bay to rise," Case said in an exclusive interview with Tampa Bay Inno. "Getting more people in the area to pay attention and do what they can to be supportive is the next step."
