PitchBook’s VC Ecosystem Rankings compare global cities based on the size and maturity of their startup networks. The framework helps founders, operators and investors assess locations when deciding where to expand or invest.
Network effects matter in venture capital: Investors get more than half of their deals through referrals, according to research led by Harvard professor Paul Gompers. So it stands to reason that dealmakers should seek these networks out when deciding where to do business.
The list is based on a scoring system that uses PitchBook’s proprietary data on private companies. Development and growth scores are based on data related to deals, exits fundraising and other factors from the last six years.
Methodology
PitchBook created the global VC Ecosystem Rankings to compare how locations rank in overall development and growth rates relative to one another. The framework provides a scoring system for development and growth by assessing the size, maturity and growth rates of a VC ecosystem using proprietary data points housed in the PitchBook Platform.
Our Development Score is derived from two criteria: size and maturity. To measure size, we have analyzed inputs including but not limited to VC deals, exits and fundraising activity. When assessing the maturity of an ecosystem, emphasis is placed on the ability of startups based in the city to secure capital, grow, exit and create outliers.
The Growth Score demonstrates short-, medium- and long-term growth momentum regarding VC deal, exit and fundraising activity across the past six years.
For more details on the methodology, read the updated note.
Data analysis by Charlie Farber. Editing by James Thorne.
Featured image by Chloe Ladwig/PitchBook News
