Measuring the Triangle Startup Community

Is the Triangle startup scene improving?

I think most people would say yes, but I haven’t seen any real metrics that prove it is improving. If it is improving, how is it improving compared to other cities and are we growing faster or are we growing at the same pace?

I have been thinking on this for a couple months and reading this post over on ExitEvent spurred me to stop being lazy and write this post.

I am going to take a swag at this using some numbers from national sources, and I hope to be able to post this again at the end of 2015 and see where we are.

AngelList

AngelList is a great place to see early company momentum. How many new startups are we generating?

North Carolina currently ranks #12 in Number of Startups

(we are letting DC pretend it’s a state for the sake of this comparison)

1. Califorina
2. New York
3. Texas
4. Massachusetts
5. Florida
6. Illinois
7. Washington
8. Georgia
9. Colorado
10. Pennsylvania
11. DC
12. North Carolina*
13. Ohio
14. Virginia
15. Arizona
16. New Jersey
17. Maryland
18. Oregon
19. Michigan
20. Nevada

(see this google doc for the entire list, data collected on 12/27/14)

Of course in a vacuum this data is fairly useless - so let’s take population into account and calculate a startup density metric. I tried a couple different denominators and came up with startups per 100k people as the one with the most sane numbers.

When it comes to Startup Density at the state level we are in 23rd place (I excluded DC for obvious reasons).

1. California
2. Massachusetts
3. New York
4. Colorado
5. Washington
6. Nevada
7. Utah
8. Delaware
9. Oregon
10. Illinois
11. Georgia
12. Floria
13. Connecticut
14. Rhode Island
15. Texas
16. Maryland
17. Arizona
18. New Hampshire
19. Minnesota
20. Pennsylvania
21. Virginia
22. Vermont
23. North Carolina*
24. Hawaii
25. Tennessee
26. New Jersey
27. Ohio
28. Michigan
29. Montana

Let's also take a look at funding numbers as opposed to just the number of companies. The following numbers are from the 2014 Mattermark report (which I recommend you buy if this kind of thing interests you)

NC is #13 for number of venture deals.

1. California
2. New York
3. Massachusetts
4. Texas
5. Washington
6. Illinois
7. Colorado
8. Pennsylvania
9. Florida
10. Ohio
11. Virginia
12. North Carolina*
13. Maryland
14. Georgia

And when looking at venture deal density (venture deals per 100k people) we are ranked #17.

1. Massachusetts
2. California
3. New York
4. Colorado
5. Washington
6. Utah
7. Delaware
8. Connecticut
9. Maryland
10. Oregon
11. Tennessee
12. Minnesota
13. Virginia
14. Illinois
15. Pennsylvania
16. Rhode Island
17. North Carolina*
18. Texas
19. Ohio

When looking at the amount of investment NC is #16.

1. California
2. New York
3. Massachusetts
4. Texas
5. Washington
6. Utah
7. Pennsylvania
8. Illinois
9. Colorado
10. Florida
11. Virginia
12. Ohio
13. New Jersey
14. Minnesota
15. Georgia
16. North Carolina*
17. Connecticut
18. Michigan

Again applying density (MM per 100k people) NC is 20th:

1. California
2. Massachusetts
3. Utah
4. New York
5. Washington
6. Colorado
7. Connecticut
8. Minnesota
9. Pennsylvania
10. Illinois
11. Texas
12. Virginia
13. Oregon
14. New Jersey
15. Montana
16. New Hampshire
17. Maryland
18. Ohio
19. Georgia
20. North Carolina*
21. Iowa
22. South Carolina

I don’t know about you but I am pretty disappointed by this data - I think if you asked most people in the are they would expect us to be higher in these lists. One issue with this data is that it is all at the state level. The Triangle is actually only 1/9th of the state population, and looking at the numbers represents the lion share of the startups. So let’s see if we can put together some more metro based data.

This data was even harder to put together, so I don’t have a complete list. If there is a group that has some interns that could complete this data please get in touch. I essentially went through the top metro areas based on this list and tried to pull the correct cities from Angelist. This is difficult because some metro’s contain other metros, etc.

But let’s compare ourselves to some other top startup metro’s out there.

The Raleigh Metro Area (including Durham, Chapel Hill, Apex, Cary, and Raleigh) has 487 startups listed with AngelList. Based on 1.2MM people that gives us a startup density of 40 startups per 100,000 people. (40.09).

**Note the above numbers are wrong, I published a post to correct them here.

Is that good?

Well let’s look at some of the largest metro areas:

New York - 8212 companies - 41.16
Los Angelos - 4763 - 36.27
Chicago - 1955 - 20.49
Dallas - 730 - 10.71
Houston - 574 - 9.09
Philadelphia - 771 - 12.77
DC - 1418 - 23.83
Atlanta - 1013 - 18.34
Boston - 3189 - 68.07
San Francisco - 9353 - 207.09
Phoenix - 536 - 12.18
Seattle - 1411 - 39.08

Based on these numbers it’s interesting to see that from a startup density stand point we are similar to NYC, LA, and Seattle. And way better than larger metros like Atlanta and those cities in Texas.

But we aren’t really competing with these metro’s - they are all 4MM+ in population and we are around 1.2MM. So let’s look at some of the well known smaller metros.

Nashville - 293 - 16.67
Raleigh - 487 - 40.09
Boulder - 370 - 119.33
Charlotte - 259 - 11.09
Salt Lake City - 405 - 35.51
Austin - 1404 - 74.55

We hold our own here beating out cities like Nashville, Charlotte, and Salt Lake City - but are well behind Boulder and Austin.

I think these are great numbers for us to look at and I think it shows the room for growth that we have. I think it’s reasonable to say we can get to a density of closer to 100, which is over 2X growth from where we are now.

All of this data is shared in this spreadsheet - again please let me know if you would like to volunteer time to complete the metro data.

Huge thanks to both AngelList and Mattermark for providing the data.

-James (@averyj