Much has been made of the alleged demise of Silicon Valley during the pandemic. From remote work to the metaverse, the thinking goes, there is a weakening in the network effect that originally drew venture capitalists and tech founders to the Bay Area.
What’s certainly true is that VC is an increasingly global phenomenon. Among Bay Area venture firms with secondary offices, 91% of those offices are located beyond California and 51% are outside of the US, according to PitchBook data.
Andreessen Horowitz took the latest chip out of Silicon Valley’s dominance when it announced the opening of offices in Miami, New York and Santa Monica last month.
“In our firm’s new operating model, we work primarily virtually, but will use our physical presence to develop our culture, help entrepreneurs and build relationships,” a16z co-founder Marc Andreessen wrote in a blog post titled “a16z is moving to the cloud.”
By far, the most popular city for Bay Area VCs to set up secondary offices is New York, followed by London. This preference is mirrored in VC deal trends: New York has steadily grown its share of deal flow in the US, and the UK and Ireland are the top destination for VC investment in Europe.
Asia is home to nine of the the top 20 cities, with Beijing and Singapore leading the way. In India, Bengaluru is the most popular destination for Bay Area VCs.
Outside of the US, Europe and Asia, Tel Aviv logged the most secondary offices, followed by Toronto and São Paulo.
Bay Area VC firms have just 6 offices in African cities, including Nairobi, Lagos, Dakar and Cairo.
Despite the expansion of capital and talent across the globe, Silicon Valley remains the heart of startup investing. More than a third of US VC dollars went to Bay Area companies in the first half of 2022, a share that has changed little over the past decade, according to the latest PitchBook NVCA-Venture Monitor.
Featured image by Jenna O’Malley/PitchBook News
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