Economy

Entrepreneurship

Worsened more than 1 percent from
2015 to 2016

How are we doing?

The entrepreneurship indicator received a thumbs-down because even though San Diego’s total venture capital investments remained over $1.25 billion in 2016, it saw a decrease of more than $580 million from 2015. Broad-based decline in venture capital was seen from 2015 to 2016 throughout most metropolitan regions nationwide. The number of patents published and granted declined from 2014 to 2015, the most recent years of data, and the number of jobs created by the innovation economy also declined. The software sector accounted for 63% of San Diego innovation startups created in 2015, an increase of 8% from 2014. See more information.

San Diego saw a slight slowdown of patents being published and granted. In 2014 a total of 7,715 were published and 6,564 patents were granted, while in 2015 only 6,957 were published and 6,443 were granted.

Data Source: CONNECT, San Diego Innovation Report, 2016

Why is it important?

  • Fostering a connected startup community can encourage more interactions among individuals and organizations supporting business creation, building a better learning environment for local entrepreneurs.
  • San Diego is a growing hub for tech and startups. It is important to identify and create more collaborative workspaces and invest in technology and innovation, which will welcome new ideas and startups into the San Diego region. This will spur economic growth, jobs, ideas and innovation moving into our region.

Among San Diego’s innovation startups created in 2015, 63% were in the Software sector with the Pharma/Biotech/Medical Devices sector coming in second with 20% of the new startups. For more on data on the innovation economy, check out CONNECT’s Innovation Report.

Data Source: CONNECT, San Diego Innovation Report, 2016

San Diego startups created a total of 1,647 new innovation economy jobs in 2015, a slight decline from the 1,861 jobs created in 2014.

Data Source: CONNECT, San Diego Innovation Report, 2016

Total Venture Capital Raised by Region

(2016)

Metro Region 2016 Total $ Difference in Total
from 2015
$ per Deal
Silicon Valley $24,915,550,000 -$9,211,150,000 $16,789,454
New York (Metro) $7,905,630,000 -$839,900,000 $12,568,569
New England $6,192,540,000 -$777,410,000 $14,170,572
Los Angeles - Orange County $4,965,110,000 -$856,840,000 $17,860,108
Southeast $2,769,870,000 -$231,650,000 $11,259,634
Washington, DC - Metroplex $2,706,660,000 $180,510,000 $15,205,955
Midwest $2,162,650,000 -$190,950,000 $6,214,511
Texas $1,330,040,000 -$564,590,000 $6,617,114
Northwest $1,326,980,000 -$777,680,000 $8,140,982
San Diego $1,275,150,000 -$583,440,000 $12,380,097
Southwest $959,090,000 -$253,760,000 $8,798,991
Colorado $671,020,000 -$350,490,000 $5,161,692
North Central $522,700,000 -$156,050,000 $8,859,322
Philadelphia (Metro) $497,220,000 -$109,790,000 $6,457,403
Sacramento - Northern California $152,310,000 $3,010,000 $9,519,375
Upstate New York $72,170,000 -$90,930,000 $4,009,444
South Central $66,570,000 -$42,720,000 $4,160,625
*see footnote for region definitions  

*Region Definitions

Metro Region Definition
Colorado The state of Colorado
Washington, DC - Metroplex Washington, D.C., Virginia, West Virginia, and Maryland
Los Angeles - Orange County Southern California (excluding San Diego), the Central Coast and San Joaquin Valley
Midwest Illinois, Missouri, Indiana, Kentucky, Ohio, Michigan, and western Pennsylvania
New England Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, and parts of Connecticut (excluding Fairfield county)
New York (Metro) Metropolitan NY area, northern New Jersey, and Fairfield County, Connecticut
North Central Minnesota, Iowa, Wisconsin, North Dakota, South Dakota, and Nebraska
Northwest Washington, Oregon, Idaho, Montana, and Wyoming
Philadelphia (Metro) Eastern Pennsylvania, southern New Jersey, and Delaware
Sacramento - Northern California Northeastern California
San Diego San Diego area
Silicon Valley Northern California, bay area and coastline
South Central Kansas, Oklahoma, Arkansas, and Louisiana
Southeast Alabama, Florida, Georgia, Mississippi, Tennessee, South Carolina, and North Carolina
Southwest Utah, Arizona, New Mexico, and Nevada
Texas The state of Texas
Upstate New York Northern New York state, except Metropolitan New York City area

Broad-based decline in venture capital was seen from 2015 to 2016 throughout metropolitan regions in the United States. Although San Diego’s total venture capital investments remained over $1.25 billion, it saw a decrease of more than $580 million from 2015.

Data Source: PwC/CB Insights MoneyTree Report, 2017

  Idea for Change

Business leaders, policymakers and city staff should continue to build on the growing momentum of public-private partnerships in the technology and innovation space. For example, the city of San Diego partnered with Qualcomm and UCSD to host a hackathon to promote technology and innovation through analyzing city data and prescribing solutions to address regional climate change. Learn more.

  Bright Spot

The San Diego Regional Energy Innovation Network, a nine-member partnership led by Cleantech San Diego, connects entrepreneurs in San Diego, Imperial, Riverside and San Bernardino counties to resources to help them successfully bring energy innovations to market. This free program provides entrepreneurs with access to the facilities and resources of several regional partner organizations to help accelerate the commercialization of their technologies. Learn more.

  What are we measuring?

We measure entrepreneurship by tracking year over year change in total venture capital raised in the region. We also track the number of patents published and granted over time, the total jobs created by innovation startups and the number of innovation startup companies created by sector each year. Learn more about the data.