Funding / Life sciences / Startups

Philadelphia held its top-30 ranking on this list of global startup ecosystems

The region kept its #27 spot on Startup Genome's report for another year. Per the report, Philly created $68 billion in ecosystem value between 2020 and 2022 — and life sciences, especially, got kudos.

Life sciences. (Photo by Polina Tankilevitch from Pexels)
We can hear the chants now: “We’re #27! We’re #27!”

Philadelphia has once again ranked in the top 30 of Startup Genome’s Global Startup Ecosystem Report.

The region stuck to its #27 spot on the global list of best ecosystems for growing companies, which it cracked in 2022 after ranking #28 in 2021. Over the last three years overall, it’s moved up 16 spots on the list.

Startup Genome, an innovation policy advisory and research firm, partnered with local organizations Ben Franklin Technology Partners of Southeastern Pennsylvania, Drexel University and the University City Science Center to get a better idea of the Philly startup ecosystem’s strengths and weaknesses.

“Philadelphia continues to build on its strengths in the life sciences, boasting several high-profile exits in recent years,” said Marc Penzel, founder and president of Startup Genome, in a statement. “However, the ecosystem has also seen a rise in ecommerce and HR tech startup success stories — marking an evolution driven largely by the talent flowing from its strong local universities, and backing from its entrepreneurial support organizations.”

See the report

(For more on Philly’s life sciences prowess, check another recent report from CBRE, which put the region at #6 in the US.)

Per the report, Philadelphia created $68 billion in ecosystem value, which measures economic impact based on the value of exits and startup valuation, from the start of July 2020 to the end of December 2022.

The city also ranked in the top 30 global ecosystems and top 15 North American ecosystems for talent and experience, funding, and performance. Talent and experience measures long-term experience trends and ability to retain talent in the ecosystem. Funding measures early-stage funding and investment activity. Performance measures size and performance based on an ecosystem’s tech startup value.

Amid national funding challenges, “Greater Philadelphia has been resilient and continues to see momentum across life sciences and technology sectors.”Tiffany Wilson University City Science Center

Plus, the region ranked in the top 40 global ecosystems and top 15 North American ecosystems for knowledge, which measures research and patent activity.

Life sciences, advanced manufacturing and robotics, and AI, big data and analytics were recognized as strong industries in the region based on talent density, resources and startup activity. The report said Philly has a reputation as an “innovation and research hub” for life sciences, and is growing that same reputation in fintech and enterprise tech.

“The last 18 months presented a new set of challenges and adversity to startups, with a drastically different funding environment,” said Tiffany Wilson, president and CEO of the Science Center; nationally, venture capital investing has taken a dip from pandemic highs. “But Greater Philadelphia has been resilient and continues to see momentum across life sciences and technology sectors. We’re proud of Philadelphia’s ranking as a top 30 global startup ecosystem and eager to continue chipping away at that number in the years to come.”

Characteristics such as Philadelphia’s lower cost, educational institutions, diverse workforce, welcoming attitude and proximity to other ecosystems like New York City and DC are all attractive to startups, the report noted. The region has also seen lots of outside investment in recent years, with $2.9 billion from Silicon Valley firms and $3.4 billion from New York firms in 2022.

Other notable stats from the report:

  • Number of unicorns — 8 (compared to a global average of 4)
  • Software engineer salary — $84,000 (compared to $46,000)
  • Time to exit — 10.5 years (compared to nine years)
  • Total early-stage funding — $1.7 billion (compared to $970 million)
  • Median seed round — $750,000 (compared to $821,000)
  • Median Series A round — $6.1 million (compared to $6 million)
  • Total VC funding — $16 billion (compared to $6.6 billion)
Sarah Huffman is a 2022-2023 corps member for Report for America, an initiative of The Groundtruth Project that pairs young journalists with local newsrooms. This position is supported by the Lenfest Institute for Journalism.
Companies: Ben Franklin Technology Partners / Drexel University / University City Science Center

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