The Global Startup Ecosystem Ranking 2015 report ranks the top 20 technology startup ecosystems in the world based on Performance, Funding, Market Reach, Talent, and Startup Experience.
Performance is based on the funding and exit valuations of startups headquartered in the ecosystem, and Funding represents the amount of investments by venture capitalists and the time it takes to raise capital.
Talent is based on the quality of technical talent, availability, and cost. Market Reach is the local system’s GDP and ease of reaching customers internationally, while Startup Experience is a qualitative measure based on surveying veteran startup mentors and local founders on the success of startups in that particular region.
The report had several significant findings since its last iteration in late 2012. Particular stories that stand out: Canadian cities are dropping drastically, cities outside of North America such as Berlin and Singapore are climbing the rankings, and the United States remains strong with four of the top five ecosystems.
Despite having many companies in the Narwhal Club, home to companies valued at more than $1 billion such as Slack, Hootsuite, and Avigilon, the Canadian market has struggled relative to the rest of the world. Waterloo, home of the once-mighty RIM, has fallen out of the Top 20 altogether.
Toronto and Vancouver each dropped nine spots, more than any other ecosystem on the list, claiming the #17 and #18 spots respectively. Vancouver had the third slowest growth out of all cities in the index, and continues to struggle as far as funding goes. Toronto had the fifth slowest growth and also needs to expand growth to venture capital.
In good news for Canada, Montreal debuted on the list, but only at #20.
Slower growth in Canada has been met with exploding markets in Berlin and Singapore. Both of these international centers have had recent success stories that have moved them up the startup ecosystem rankings.
Berlin jumped an impressive six spots to #9 overall and had 20x the average growth of all startup markets. Zalando, Europe’s largest online-only fashion retailer raised $668 million in an IPO to value the company at $6.8 billion overall. Meanwhile, Rocket Internet had the biggest IPO since 2007 in Germany, raising $2 billion.
Singapore moved up seven places, more than any other ecosystem, to round out the Top 10. Growth was relatively average, but the government’s support of the ecosystem and Singapore’s strong financial community helped out its ranking in the Funding category. Garena, a social gaming platform, is valued at $2.5 billion and is one of Singapore’s bright stars.
Lastly, the United States remained on top of the leaderboard with four cities in the Top 5. Silicon Valley remains at the top of the list with the best rankings in all categories (except Market Reach). New York jumped up three spots to finish #2, having the best Market Reach of all cities in the index. Los Angeles and Boston are right behind with the #3 and #4 spots. Austin is also notable, as it debuted on the rankings this year at 14th place.
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