Innovation and entrepreneurship is no longer found only in Silicon Valley. Sure, it makes sense that major metropolitan cities like New York are becoming influential startup hubs, but it may be more surprising to hear about a few other cities seeing major growth in venture capital investments.
A recent report by the National Venture Capital Association said Charlottesville, Virginia, currently has the fastest-growing venture capital ecosystem in the U.S. Since 2010, venture capital investment in Charlottesville has shown a compound annual growth rate of 55.2 percent. In 2010, only one company in the area received a total of $250,000 in startup funding. In 2015, nine companies received a total of $27.7 million.
Why such rapid growth?
The presence of the University of Virginia in Charlottesville has played a pivotal role in the city's astounding growth in startup financing. UVA Today explained how the school has dedicated itself to promoting innovation and entrepreneurial ventures. In addition to the University's i.Lab, a startup incubator that provides coaching and workshops, the school also has a brand new entrepreneurship minor available to undergraduates. The Darden School of Business's Batten Institute for entrepreneurship and innovation also holds start-up competitions for students.
Then there is the UVA Licensing & Ventures Group, which UVA Today explained safeguards the intellectual property of UVA researchers. Six out of the nine companies that received startup funding in Charlottesville last year worked with the Licensing & Ventures Group.
The culture of entrepreneurship bred by the University of Virginia has transformed Charlottesville into a hotbed of bright ideas. According to the Charlottesville Newsplex, examples of startups that began with the support of UVA include wedding website Borrowed and Blue, biotech company Diffusion Pharmaceuticals Inc., energy company PsiKick and diabetes management platform TypeZero.
The National Venture Capital Association said after Charlottesville, Oklahoma City has the second-fastest growing startup economy in the U.S., followed by Rochester, New York; Chattanooga, Tennessee; and Memphis, Tennessee. Between 2010 and 2015, they experienced compound annual growth rates as follows:
- Oklahoma City: 51.6 percent
- Rochester: 43.1 percent
- Chattanooga: 38 percent
- Memphis: 34.5 percent
These cities may not come close to the venture capital power of Silicon Valley, but they are part of the trend of a stronger startup culture spreading throughout the country. As new hubs for innovation continue to appear, it seems great ideas may no longer only be found on the coasts.
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