Where Are the World’s Biggest Tech Hubs?
Tech is being built all over the world, but there are certain places where investment into creating successful technology products and companies is happening more consistently than in others, for a variety of reasons (mostly infrastructural and economical).
To get a better idea of what the global tech landscape looks like, here is a brief investigation into how much investment and growth is happening around the world when it comes to startups, investment rounds and unicorns (based on the most readily available data).
First of all: what is a tech hub?
In Africa, a tech hub often refers to a specific place within a city, where an environment has been created to support the establishment and growth of technology products and businesses. But in other parts of the world, these kinds of tech hubs are so commonplace that entire cities are now referred to as tech hubs.
So really, what we’re talking about in this article is concentrations of tech activity, which are being invested in as a way to boost economic growth in a changing world (and this mostly happens in cities, because that’s where the all the resources are).
A tech hub also implies some degree of previous success, and a tech hub’s ranking is dependent on factors like how much investment is happening in the space/city, and how many successful exits there are (i.e. how many startups and ideas actually become highly valuable businesses). While the adding of the term “Silicon” to every other tech-focused area is getting a little bit ridiculous, this list of technology centres just gives an indication of how many of these places there are around the globe.
Who are the biggest players?
It’s not really surprising, but according to the Global Tech Hub Report by CB Insights, Silicon Valley still very much leads the way when it comes to large exits, unicorns and overall tech investment. Interestingly though, Asia is catching up quickly, with cities like Beijing and Shanghai showing phenomenally fast growth in the technology sector.
Certain tech hubs also tend to focus on certain areas within technology development, so while some places might have the largest overall investment (i.e. the Bay Area), there might be powerful innovation taking place in a city that doesn’t necessarily rank highest on the list for rounds and exits.
To get an overall picture, the study groups different tech hubs into Heavyweight Hubs, High Growth Hubs and Up and Comers. Heavyweights include Silicon Valley, Boston, New York and Los Angeles, while High Growth Hubs include Beijing, Shanghai, Toronto and New Delhi. Recent Up and Comers are cities like Sao Paulo, Sydney, Stockholm and Amsterdam.
What is being built in these tech hubs?
According to the Global Startup Ecosystem Report (and an analysis by CityLab), there is a currently an overall trend towards investment in AI, Big Data and Analytics, Blockchain and Advanced Robotics and Manufacturing. Mapped out, it’s interesting to see that certain areas focus on different kinds of innovation (for example, the largest grouping of robotics focused development is in North America).
Overall, some of the biggest recent exits (outside of the US) over the last while include Spotify in Stockholm and JD.com in Beijing, as well as ride-sharing and delivery services like Didi in China and Deliveroo in London- a tech category we touched on in a previous article about some of the most innovative software development happening right now.
What about Africa?
It’s abundantly clear from the CB Insights report that Africa doesn’t really feature (at the moment) when it comes to large scale global tech investment, but other recent stats suggest that it won’t be that way for long. Currently, there are 442 tech hubs in Africa, and while most of these are concentrated in South Africa, Nigeria, Kenya and North Africa, there has been considerable investment into accelerator programs throughout the continent.
When looking at factors other than overall investment, cities like Cape Town also feature as some of the best places to build a tech product, with bonus points for affordability and convenience. So while African tech hubs might not be competing with Silicon Valley’s 252 successful exits over $100M right now, it’s obvious that the groundwork is being laid for increased development in the future.
How are tech hubs going to evolve?
It’s overwhelming enough to try and make sense of all the technology that’s being developed at the moment, never mind who is investing in these ideas, and how much. But even if it’s difficult to keep track of all the details, it’s more than obvious that tech hubs and products are a significant investment focus around the world.
As connectivity, infrastructure and access to finance improves, it’s incredible to think about how the landscape is going to change in the years ahead.