The combined metropolitan area of Raleigh and Durham is on track to be part of the next wave of technology startup hubs — that is, at least, according to a new study from the Washington, D.C.-based think tank Progressive Policy Institute.
In the last two years, the rate of startup companies founded across the country has accelerated, PPI said in its study, and that growth has begun to shrink the gap between well-known technology hubs, such as San Francisco, New York and Boston, and smaller metro areas across the country.
According to data compiled by PPI, along with the tech company network TechNet, nearly half of new startups formed in the past two years have come from outside the 35 largest metro areas, and many burgeoning startup scenes are beginning to take root in those markets. In the previous seven years, those same regions accounted for just one-fifth of new startup growth.
To determine where that growth is coming from, PPI created a new data index called the Metro Startup Economy Index. The MSE Index is meant to measure the intensity of every metro area’s startup scene by taking the percentage of job postings that contain the word “startup” in the area and then dividing it by the median percentage for all areas analyzed.
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The new index found the combined metro area of Raleigh and Durham to be among the top 10 emerging tech hubs in the nation — and 17th overall. PPI considered emerging tech hubs as metro areas that scored outside of the top 10 overall in the MSE Index but inside the top 35.
In recent years, both Raleigh and Durham have received national attention for the tech companies that have bubbled up here. Most notably in Durham, the co-working space American Underground has gained attention for its partnerships with the tech giant Google, visits from AOL founder and tech investor Steve Case and its goal of making Durham the most diverse tech hub in the country.
Overall, The top 10 metro areas in the index weren’t surprising. The top two metro areas were San Francisco and San Jose, which both benefit from Silicon Valley. The rest of the top 10 included: Seattle, New York, Boston, Austin, Texas, Provo, Utah, San Diego, Chicago and Los Angeles.
The “Raleigh-Durham” area still has a lot of work to do to catch up with the tech titans of the U.S. — “Raleigh-Durham” received an index score of 2, while San Francisco’s was 18.2.
The only other North Carolina metro area to make PPI’s emerging tech hub list was Charlotte, which ranked 29th overall.
The next 10 emerging startup hubs
▪ Washington, D.C.
▪ Salt Lake City
▪ Portland, Ore.
▪ Worcester, Mass.
▪ Nashville, Tenn.
Source: Progressive Policy Institute