Global startup revolution
The US, and in particular Silicon Valley, has long dominated the world’s share of venture capital. In Proptech for instance, 52% of global venture capital is invested in the States. However, a new report by Richard Florida points to a rebalancing. In the 1990s, 95% of VC activity was in the US, whereas today it is more like 50%. Whilst China is behind much of this trend, startup activity is found to be concentrated on a small number of dominant global cities (London being the top city outside the US). Why is this? Florida asserts that ‘innovation and entrepreneurship are fundamentally urban processes that require the density, diversity, and scale of large cities’. Density brings with it the potential for large numbers of serendipitous interactions. If we consider that the work of the future is trending away from the performance of linear tasks and towards creativity and innovation, this paints a strong argument for the continuing rise of the best agglomerations. Florida points to ‘the rise of the rest’ – a term used to describe the increasing importance of the US’s second tier cities, but concludes that in fact, ‘the rest’ are more accurately the global centres like London that continue to take an increased share of global business activity.