For all of the chatter in regards to the decline of San Francisco, knowledge repeatedly reveals that the Bay Area, together with town itself, continues to be one of the best place for venture-backed startups.
Startups positioned within the Bay Area vacuumed up $90 billion of VC funding in 2024, which was 57% of the $178 billion of world enterprise funding spent final yr, new stats launched on Tuesday by Crunchbase present.
In 2024, OpenAI, headquartered in San Francisco, was clearly the mothership, each in spawning a close-by AI startup business full with its personal deep-pockets startup fund, and within the VC {dollars} it scooped up for itself. But others embrace San Francisco’s Databricks and its record-breaking $10 billion in funding; Elon Musk’s xAI, which raised $12 billion in two rounds final yr and promptly moved into OpenAI’s previous headquarters within the San Francisco Mission District; Mountain View’s Waymo and its $5.6 billion Series C; San Francisco’s Anthropic, which raised over $8 billion in 2024; and massive raises in 2024 from San Francisco’s Scale AI and Perplexity.
And, as we beforehand reported, this isn’t simply happenstance. It’s a results of the world’s dominance in AI, the largest tech of 2024, in addition to being residence to Big Tech (Google, Nvidia, Salesforce, and so forth.) and having a long-standing startup infrastructure there — from Y Combinator to the VC land of Sand Hill Road.
This self-fulfilling cycle reveals no indications of flagging in 2025, partly as a result of the Bay Area nonetheless gives the biggest focus of expert tech staff. Some 49% of all Big Tech engineers (usually the startup founders of tomorrow) and 27% of startup engineers are positioned there, based on knowledge from SignalFire.
With such excessive density of the whole lot from financiers to engineers, assembly the individuals vital to construct a startup is simply simpler, say founders who’ve relocated to San Francisco in 2024. “We really feel just like the expertise pool is healthier. Also the shopper pool is healthier,” Anh-Tho Chuong, co-founder and CEO of open supply billing platform Lago, beforehand instructed TechCrunch.
