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Austin’s startup ecosystem has been named one of the 20 best cities in the world, jumping into a list it was excluded from the last time it came out.
The report by Compass, a software company based in San Francisco, said Austin employs more than 100,000 workers in its tech startup sector. Quite impressive considering total population is 1.8 million. Hometown heroes like RetailMeNot and HomeAway are credited for contributing to the success of the city.
Austin ranked #2 on the startup experience index, noting its strong collaborative culture, proportion of employess with prior startup experience and reliance on veteran mentors.
Startup strongholds like Silicon Valley, New York City, and Los Angeles lead the pack, with Boston and Seattle also landing in the report's top ten. Tel Aviv, London, Berlin, and Singapore rounded out the top half of the list.
Compass collected insights from 11,000 startup surveys and over 200 interviews with entrepreneurs in 25 countries. The rankings were based on a city's overall performance, funding, talent, market reach, and startup experience.
Amsterdam and Montreal were also newcomers to the list.
Although Austin has a leading startup ecosystem, it faces increasingly stiff competition. Here are some of the report’s key findings:
- Austin came in 6th in terms of talent, with the average time to hire tech talent coming in 6 percent longer than North America’s average score.
- Austin ranks last among U.S. ecosystems in the top 20 due to its small local market and low Global Market Reach score. It has the second lowest percentage of foreign customers (24%) and second-lowest number of product languages at 1.4.
- Seed funding in Austin is 8% higher than the regional average. Series A, is 15% lower than the regional average, indicating a funding gap.
- The density of startups in Austin is 33% higher than the North American average.
