Investment in Pittsburgh’s Technology Sector: Trends & Highlights 2010 — 19
We could all use some good news right about now. So Innovation Works (IW) and our partners at Ernst & Young (EY) are very pleased to release the highlights of a record year for investment in the region. Our analysis of 2019 shows the deals and trends that attracted close to $3 billion in funding in 139 unique companies.
The amount invested increased more than five times from the year before, led by corporate investing — often in the autonomous vehicle space in dramatic deals you probably read about. But, don’t overlook the activity in life sciences and software which contributed so significantly to this year’s totals. In all, the diverse portfolio of regional investments looks a lot like Pittsburgh’s greatest research assets over the past decades.
In the past five years, more than 270 investment firms from around the world invested in local tech companies. In 2019, 39 venture capital firms made their first investment here, which brings a partner to Pittsburgh every quarter or so for board meetings and interaction with their portfolio companies. This is a fantastic opportunity to show these investors more potential deals and what is so unique about doing business in our low-cost, high talent region.
What is the best measure of all this activity? More than $10.7 billion in exit activity. That’s a huge addition to the regional economy as entrepreneurs gain the resources to scale and large companies like Microsoft, Smith & Nephew, 3M, IBM, and others acquire startups here and then increase their presence in our region. These companies often go on to hire more people, mint new angel investors and serve as critical mentors for new and growing startups. They also attract the attention of tech media and other investors as Pittsburgh becomes known as a technology hub worth noting.
There is so much in the pipeline. Our powerhouse research universities have attracted about $10 billion in federally funded research over the past decade. This funding from the National Institutes of Health, National Science Foundation, Department of Transportation, and others fuels the research that ultimately spins out as startups. There is much to look forward to as many of our universities make it easier and more accessible for students, faculty and other researchers to partner with or become entrepreneurs to see their innovation through to commercialization.
And finally, the fantastic quotes in the report from entrepreneurs and investors will make you wear your Pittsburgh pride. If you look at how the region is doing versus other tech hubs and emerging regions, Pittsburgh is in some great company. Though we aspire to even greater activity, our tech community is holding its own with bigger cities like Philadelphia and Washington D.C. and stripping ahead of others such as Dallas, Atlanta, and Las Vegas.
This is news we’re excited to share.
Please take a few moments to read through the report. Or, there’s a slide synopsis of the highlights for review.
Keep healthy and safe!
Rich Lunak, CEO, Innovation Works & Leon Hoffman, Pittsburgh Office Managing Partner, Ernst & Young LLP
