Whether you’re an entrepreneur plotting to launch a startup or a CEO strategizing where to put another office, knowing where the next hot city is would be a game changer. Should you expand to Raleigh? Would you attract better talent in Austin or Atlanta? With the new Surge Cities Index, Inc. and innovation policy company Startup Genome crunched the data to score and rank the top 50 metro areas in the U.S. on seven key indicators–from early-stage funding metrics to job creation. Finally, here’s the smartest way to answer the age-old question: Where should you go next?
No. 1 AUSTIN
Austin is now growing four times faster than most of Silicon Valley–drawing talent and startups from all over the country.Once known as a magnet for slackers, the so-called “Live Music Capital of the World” and home of the University of Texas-Austin had a reasonable cost of living, loads of sunshine, well-educated people, and a fun streak. Those are still the reasons people flock to Austin, but slacking off is most certainly not their goal. Today, the metro area, with a population of 2.1 million, is growing four times faster than San Jose and San Francisco (per capita), with entrepreneurs leading the way. Last year, Tyler Haney, founder of New York City-based athletic clothing company Outdoor Voices, relocated her venture-backed company here, as did Peter Thiel’s San Francisco venture capital firm, Mithril Capital. Tech giants including Google, Facebook, Amazon, and Dropbox have all established large presences here. And in December, Apple, which already has its second-largest outpost in Austin, announced it will be investing $1 billion to build a new campus that could eventually hold 15,000 new employees. With all the shiny new high-rises sprouting downtown, it can feel like the city has changed almost overnight, but in fact it’s been decades in the making. Austin-born originals like Dell, Whole Foods, and Trilogy Software have been luring talent to town since the ’80s–and then watching alums go on to become founders themselves. More recent successes, such as Homeaway, Bazaarvoice, and Deep Eddy vodka, have done the same. And South by Southwest allows the city to show itself off to the world’s startup elite every spring. The result: thriving startup scenes in food and drink, computer hardware, enterprise software, and–increasingly–consumer tech. Austin still has lots of live music, but today the city’s creative class is creating business as much as art. –Tom Foster
No. 34 PHILADELPHIA
This East Coast city flaunts one of the best business schools in the country, but its best kept secret is immigrant entrepreneurs.Immigrants have been flocking to Philadelphia because it’s a sanctuary city–and cheaper than its neighbor New York. Philly counts more than 40,000 immigrant entrepreneurs, running everything from tech companies (Cloudamize, Haystack Informatics) to food trucks (Chez Yasmine, Delicias). This spring saw the second citywide Immigrant Business Week, kicked off by Mayor Jim Kenney, who has traveled to SxSW to stump for Philly startups. On the tech front, the University of Pennsylvania’s graduate program ranks third and its undergrad program ranks fifth globally in the production of venture-backed entrepreneurs, according to PitchBook. Comcast-NBCUniversal, Philly’s largest tech private employer, has a new accelerator, whose first class includes a game console startup from the son of Atari and Chuck E. Cheese’s founder Nolan Bushnell. And the city continues to brew successful coffee companies, including La Colombe, now in five states and D.C., and Saxbys Coffee, which is colonizing college campuses along the East Coast. –Leigh Buchanan
No. 35 RICHMOND
Richmond’s thriving startup scene, which includes a plant-protein innovator and a maker of an opioid antidote, is rich with creativity.In a state where the main private-sector industry for 400 years has been agriculture, it’s no surprise Richmond has its share of food-centric startups. Standouts include insulated-packaging manufacturer TemperPack, which scored $4.5 million from Closed Loop Fund in July, and plant-protein product specialist Nutriati. Beyond that, the city’s entrepreneurs resist classification. Lighthouse Labs, led by Todd Nuckols, has nurtured companies that offer Lyft-like service for non-emergency medical transport (RoundTrip) and provide support to parents of autistic children (AnswersNow). Controversial pharma startup Kaléo is a local hero: This spring it began offering an opioid-overdose antidote for free to eligible patients in some states. Countering a shortage of early-stage capital are $4 million fund Trolley Ventures, founded in September, and VC firm NRV, which last year launched a $33 million early-stage growth fund. –Etelka Lehoczky