When it comes to increasing the success rate of startups across the globe, it’s all about location, location, location, according to new research from Startup Genome.
The company’s 2017 Global Startup Ecosystem Report ranked Vancouver and Toronto-Waterloo as 15 and 16th respectively for their ability to foster the success of early-stage startup businesses.
“Early-stage startups are highly dependent on their surrounding startup ecosystem, and so if we can create healthier startup ecosystems, we can generate more successful startups,” the report says.
Startup Genome assessed 55 startup ecosystems across 28 countries and took into account key indicators such as talent, funding, market reach, resource access and attraction, corporate involvement, global connectedness, and startup experience.
The ranking is primarily driven by one question: in which ecosystems does an early-stage startup have the best chance of building a global success?
As one could have assumed, the areas of Silicon Valley, New York, and London took the top three spots this year, while Montreal fell out of the top 20 after taking the last spot in 2015’s report.
Toronto-Waterloo, which jumped up one spot from 2015’s report, actually ranked fifth in the category of market reach and 12th in funding, but lost momentum in the categories of talent and startup experience. The report describes the corridor as home to the second highest density of startups in the world, and while once considered two separate ecosystems, in the past year, “there have been strong signals that the region is increasingly behaving as one ecosystem.”
Reza Moridi, Ontario’s Minister of Research, Innovation and Science, says the Toronto-Waterloo corridor “driving Ontario’s position as a thriving startup hotbed.”
“Startup Genome’s report reinforces how important it is for our province to continue to foster a culture of innovation by investing in an educated, talented workforce,” he adds in the report.
“An increase in high-growth companies has driven the continued expansion of the Waterloo Region startup ecosystem over the past year, attracting record levels of capital, along with new talent and companies to the region,” explains Iain Klugman, CEO of Communitech, a Waterloo-based tech innovation centre. “Increased collaboration along the Toronto-Waterloo corridor means that these companies are able to access the resources they need to keep growing, and will provide even greater opportunities for the next generation of startups being built.”
Vancouver, on the other hand, moved up three spots from 2015, and like Toronto’s results, shone in the market reach category (7th), but was borderline in the rest.
The report notes that Vancouver has more startups per capita than any other city in Canada, and leverages its unique combination of being “Hollywood North,” having a strong industrial foundation and a diverse talent pool, with over half its residents having a first tongue other than English.
“The city’s growing reputation is underpinned by the highest concentration of visual effects and animation studios, two of the top six video game franchises, and its ranking as one of the world’s top 20 Global Financial Centers,” the report explains.
Ian McKay, CEO of the Vancouver Economic Commission, says that he is proud of the recognition Vancouver is getting as one of the top global startup ecosystems.
“We owe our success to the diverse and entrepreneurial talent drawn to our city; our location as a gateway to Asia and the West Coast; and an ecosystem that encourages interconnectivity and collaboration,” he says in the report. “As our city continues to attract talent and capital, we feel incredibly optimistic for our future.”
Ryan Holmes, CEO at Hootsuite, shares in the report that when he first began the social media platform, he was told he “couldn’t build a major tech company in Vancouver” because there were too few investors, engineers and top-level managers.
“Each day, I’m driven to prove them wrong. We’ve been able to scale to nearly 1,000 employees, more than 15-million users and have established ourselves as the leading social media management platform globally,” he says.