San Francisco Named a Global Leader in Disruptive Innovation
When people think of San Francisco, they might think of the Golden Gate Bridge, cable cars, Chinatown, the 49ers or Giants. I’m a fan of all of those things, but what usually comes to mind when I think of San Francisco is Silicon Valley, the world’s premiere hub for innovation and entrepreneurialism. That makes it, I believe, one of the most attractive places in the world to invest.
Others clearly share this belief. One consulting firm, in fact, just named San Francisco as having the best long-term outlook in terms of innovation and business.
Since 2008, A.T. Kearney has annually ranked the world’s most innovative cities, and for the second straight year, the City by the Bay topped the group’s list of cities with the greatest outlook “to attract and retain global capital, people and ideas.” Decisive factors included not just innovation but also personal well-being, economics and governance.
Rounding out the top five cities were New York, Paris, London and Boston. But for my money, San Francisco, and indeed the broader Bay Area and Silicon Valley, offers the most attractive investment opportunities, for numerous reasons.
Patents and Venture Capital Galore
San Francisco—and its fellow Bay cities San Jose, Oakland, Mountain View and others—is ground zero for American innovation. Taken as a whole, the Bay Area has far and away the most patents than any other American city, after surpassing New York City in 1995. It grew from contributing only 4 percent of U.S. patents in 1976 to 16 percent by 2008.
A.T. Kearney’s report cites San Francisco’s strong start-up ecosystem, emphasis on technology and willingness to take risks as contributing factors to the city’s rapid increases in the number of U.S. patents.
The Bay Area also leads the nation in the amount of venture capital that pours in every year. A study conducted in 2012 by the Bay Area Council Economic Institute and Booz & Company found that the region, where most Silicon Valley companies are headquartered, attracted between 35 and 40 percent of all U.S. venture capital investment. Much of the investment focused on information technology, biotechnology, internet, digital entertainment and “cleantech” firms.