2019 Best of the Midwest: Startup Cities Rankings
This is the third year we have ranked the tech ecosystems of 54 Midwest cities, and the overarching data continues to show the Midwest's broad growth in tech across the region. The biggest news of the past year seems to be that we welcomed the mega-rounds. Minneapolis' Bright Health raised $200M in late 2018. In Kansas City, we saw Insight Partners back PayIt with $100M. But that's just the tip of the mega-round iceberg. Chicago's Tempus raised $200M in May. Columbus saw Root Insurance raise $100M while Detroit's StockX snagged $110M. And this doesn't count the sub-$100M investments, such as Chicago's Cameo, Columbus's Beam Dental or Ann Arbor's Clinc at about $50M each.
New funds were also raised — Matchstick Ventures raised $30M in the Twin Cities, Allos Ventures collected $40M in Indianapolis, MATH closed on $46M in Chicago, Cultivation Capital hauled in $70M in St. Louis and Columbus’s Drive Capital became the first Midwest VC fund to reach $1B AUM in.. forever? And to be sure, money is coming out of these companies too — more and more often in true unicorn fashion, with Ann Arbor’s Duo Security’s $2.35B acquisition by Cisco Systems last September, and Lafayette’s Endocyte’s $2.1B acquisition by Novartis a month later. If you’re paying attention, it should be clear by now — capital here is flowing and growing.
With these success stories come more competition. Each Midwest city is in a race to attract, grow and retain tech startups - and some are ahead in that race while others are… getting lapped. Our goal has been to provide an analytical, objective benchmark to help entities and individuals determine how ecosystems are performing relative to each other. Each year we have received great, helpful feedback and include some changes and improvements to our methodology. While there will be no "perfect" way to rank these cities on completely objective terms, we strive to remain as unbiased as possible and continue to invite your comments and ideas as we will undoubtedly refine and improve each year. But for now, we are pleased to present, 2019 Best of the Midwest: Startup Cities Rankings!
Data cutoff date at 06/30/2019
A measure of how active the tech community in the city is, and the size and quality of the network available to a new startup. Factors included are the number of startups present, the number of exits, the growth in startup formation and the scale of large outcomes (both large exits and large fundraises).
Data comes directly from Pitchbook.
A measure of how supportive the city's environment is, and the value-add it can provide to help a startup grow. It considers factors such as the quality of talent, investor activity, accelerators, universities, and government support.
Data comes from several different sources: the US Census, US Patent & Trademark Office, Fortune.com, Pitchbook, US News & World Report, the Seed Accelerator Rankings Project, The Global Accelerator Network, US Small Business Administration and individual state websites.
A measure of how conducive the city's economic environment is to attract and scale a business. It includes demographic and economic factors such as the cost of living, labor costs, business tax friendliness, population and GDP per capita, as well as ‘connectivity’ indicators like the quality of airport and highway infrastructure.
Data comes from several sources: the Bureau of Labor Statistics, the Bureau of Economic Analysis, the US Census, the Tax Foundation, and Google Flights.
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