It's difficult to know exactly where the hottest spot is for startups seeking investment in the US. However, Boston, MA, has appeared in many lists of 'cities to watch' over the years. But why is that – and what do Boston startups have to show for themselves?
Is Boston Best for Startups?
Data seems to suggest that the city remains a hot-bed for new business ventures, even as recently as December 2019. Specifically, Inc. advised at this time Boston was among its top picks for the best cities in the US to start businesses. The 2020 Surge Cities index showed that the area strides ahead of Portland and Orlando, for example, to rank 14th out of 50.
There are many successful ventures from the city to back this up. For example, NeighborSchools, a childcare search innovator, seeded $3.5 million in late 2019. Neural Magic, a venture developing machine learning in Boston, raised $15 million in the same period. Thras.io, a Boston e-commerce innovator, claimed $20 million late last year, too.
These statistics on their own are impressive. But what is it that's driving Boston to continue to be a top city for small and growing ventures?
A Unique Innovation Hub
Underscore.vc suggests that Boston's reputation for supporting startups comes from its inherent diversity. That is hard to argue against when we consider that the city's diversity index rating rolls in at 70.2%, making it the sixth most diverse city in the US as of 2017.
This, Underscore suggests, is an indicator that the city is fluid in terms of job influx. At the same time, smaller companies in Boston are raising millions in 2020, even amid uncertain times. The same source suggests, for example, that there was an increase of venture investment in the city by $2 billion across March and April.
We must also consider growing firms such as Amwell and Atea Pharmaceuticals. Both are Boston giants in biotech and helped contribute to $1.5 billion in VC funding for the industry in May 2020 alone. These are very promising figures.
Meanwhile, Inc. suggests that the city's unique educational sphere is a key trigger for its immense innovation. MIT, of course, is based close by in Cambridge, MA. Therefore, it stands to reason that the city is home to a slew of tech innovators and graduates.
The Future Looks Bright
These statistics – as well as further research – suggest Boston continues to be one of the most progressive and innovative US cities. How 2020 will play out will remain to be seen. However, statistics from the spring suggest confidence in the city remains high.
Those VCs looking for Boston startups will likely continue to monitor MIT for promise. Or, they may choose to filter through directories such as Fundz for effective networking carefully.
In any case, eyes remain firmly fixed on Boston, and for a good reason. Startups in the biotech sphere and machine learning, in particular, may be worth the payoff very soon.