Philly is ranked one of the world’s best places to found a startup, climbing to No. 25 globally

Philly has officially cracked the world’s top 25 startup ecosystems, according to a respected industry ranking.

Philadelphia moved up two spots from last year’s No. 27 ranking on the annual Global Startup Ecosystem Report from trade association and research group Startup Genome and the Global Entrepreneurship Network.

Diverse talent and collaboration helped Philly stand out this year, per Tiffany Wilson. She’s president and CEO of the University City Science Center, a Startup Genome member.

“Sharing ideas and resources with other cities, and being a welcoming destination for life sciences and health tech companies to do business has definitely improved our standing,” Wilson told Technical.ly. “This recognition only opens more doors for us, and gives other cities a chance to learn about the assets and resources that we have here.”

Philly outpaces the global funding, growth averages

The value of Philadelphia’s startup ecosystem was $92 billion between 2021 and 2023 while the global average is $29.4 billion. This is 40% compound annual growth compared to 2019 to 2021.

Among Philadelphia’s strongest sectors are life sciences, which commercial real estate group CBRE ranked the region as the 6th best life sciences market in the country last year. AI, big data and analytics and advanced manufacturing and robotics, are also important industries according to the report.

In general, Philly outpaced several global startup ecosystem stats.

The global average for early stage funding between 2021 and 2023 was $655 million, while Philadelphia averaged $2.5 billion — nearly 4x that.

Between 2019 and 2023, the city produced seven unicorns (companies valued at over $1 billion) compared to the global average of three. It tapped into a total of $15.7 billion in VC funding over those years, while the global average was $4.6 billion.

View the full report

Startups move to Philly for the people

Philadelphia offers diverse and skilled talent, collaboration between stakeholders and support for local businesses, all of which are attractive to startups.

“I think what this list shows is that the world is more interconnected than ever before,” Wilson said. “We are not seeing this because we are insular, but because we are engaging, learning from, and participating in the global economy.”

For example, French company BioMérieux acquired local food testing company Invisible Sentinel in 2019. Since that deal, BioMérieux has expanded its presence in Philadelphia and plans to open a 32,000 square foot building at the Navy Yard, Wilson said.

Startup accelerators, collaboration help local companies shine

Despite this milestone, Philly has to keep pace with other cities and regions that are investing in their innovation economies, Wilson said. For example, the Science Center is working to create connections between academic institutions, government agencies and other startups to provide more opportunities, Wilson said.

Programs like the Capital Readiness Program and US Market Access Program are designed to bring companies into the region and increase collaboration. The Founders Fellowship program is supported by grants from the National Institute of Health to continue research in the region. The goal is to attract sources of capital and international companies to the region to provide more opportunities to local startups, Wilson said.

The Science Center is just one resource in the region. Ben Franklin Technology Partners of Southeastern Philadelphia and Drexel University were included in the report as Startup Genome members. Philly Startup Leaders, Comcast’s LIFT Labs, Philadelphia Alliance for Capital and Technologies and 1Philadelphia were all also listed as ecosystem players in the report.

“The reality is, the work never stops,” Wilson said. “An important pillar to this strategy is nurturing the homegrown ideas and startups that give Philadelphia its identity.”

Sarah Huffman is a 2022-2024 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.