New York and Boston are trying to get a bigger slice of the VC pie. But a new report suggests they're going to have to work a lot harder.

The venture capital industry bounced back considerably in 2011, according a report released last week by PricewaterhouseCoopers  and the National Venture Capital Association. Investments totaled $28.4 billion, an increase of 22 percent over 2010 and a whopping 44 percent from 2009. They are almost back to their 2007 pre-crisis high of $30.8 billion.

The map above, by the Martin Prosperity Institute's Zara Matheson, shows the regional breakdown. (The PWC MoneyTree data is only available for this set of regions). Silicon Valley remains the leading center for venture capital investment with $11.6 billion, 40 percent of the total. New England (mainly the greater Boston area) was second with $3.2 billion in capital, 11 percent of the total. Greater New York was not far behind, with $2.7 billion or almost 10 percent. It also bested New England in the third quarter of 2011. 

The graph above tracks venture capital investments since 1995 for the five biggest regional centers for investment. While much has been made recently of New York's rise in venture capital and high-technology, the graph shows a pretty stable baseline over the past decade with a modest uptick over the past couple of years. If anything, Silicon Valley's overall lead, and the gap between it and New York, New England and other leading regions, appears to be increasing.

Venture capital investment can and does flow widely across regions and is attracted to areas with the best deals and strongest ecosystems for innovation and entrepreneurship. It is largely a myth that a lack of venture capital funds in certain places holds back innovation there. Generally speaking, efforts to publicly provide or subsidize venture capital in and to certain locations have been fraught with difficulty.

About the Author

Most Popular

  1. Equity

    What Happened to Crime in Camden?

    Often ranked as one of the deadliest cities in America, Camden, New Jersey, ended 2017 with its lowest homicide rate since the 1980s.

  2. A photo of a police officer in El Paso, Texas.
    Equity

    What New Research Says About Race and Police Shootings

    Two new studies have revived the long-running debate over how police respond to white criminal suspects versus African Americans.

  3. photo: Police line up outside the White House in Washington, D.C. as protests against the killing of George Floyd continue.
    Perspective

    America’s Cities Were Designed to Oppress

    Architects and planners have an obligation to protect health, safety and welfare through the spaces we design. As the George Floyd protests reveal, we’ve failed.

  4. A participant holding a Defund Police sign at the protest in Brooklyn.
    Equity

    The Movement Behind LA's Decision to Cut Its Police Budget

    As national protesters call for defunding police, a movement for anti-racist “people’s budgets” is spreading from LA to Nashville to Grand Rapids.

  5. Equity

    The Problem With Research on Racial Bias and Police Shootings

    Despite new research on police brutality, we still have no idea whether violence toward African Americans is fueled by racial prejudice. That has consequences.

×