How many startups in the US are there in 2022?

Everybody has to start somewhere.

This also applies to business and entrepreneurship.

Microsoft, Apple, Amazon, and other successful enterprises we have today were all once startups struggling to find market and funding for their ideas.

But look where they are right now.

Despite the high mortality rate involving startups, aspiring entrepreneurs are willing to take on the challenge and exhaust all of their resources to take their ideas out in the open.

Does opening in one location increase or decrease their chance to succeed? Let’s find out. 

How Many Startups in the US Are There in 2023?

For those who have deliberately searched to find out how many startups in the US are there in 2023, more than 70,000 active startups operate in the country today.

This impressive number comes without a doubt as the country is home to the talked-about Silicon Valley which is the ultimate breeding ground for tech startups since the 1970s. 

Similarly, the United States is known to have one of the best startup climates in the world by offering supportive policies, quick access to market and funding, and early indoctrination on entrepreneurial ideas.

Startup America Initiative

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Today, many people wonder why many of the world’s most successful startups come from the United States. One important thing to look at is easy access to funding.

In 2011, the White House launched “Startup America” under the leadership of former US President Barack Obama.

The initiative aims to accelerate and promote high-growth entrepreneurship throughout all states to achieve sustainable development and better-quality jobs for citizens.

The Small Business Administration administrated the $2 billion funding for impact investing and early-stage seed financing.

Startups started in America have access to almost every secret ingredient to success.

From the availability of role models like Apple, Facebook, and Amazon, critical when creating one’s business strategy, to having a highly developed knowledge economy, the US has it all.

Truly living the American dream.

How Many Women-initiated Startups are There in the US?

There is also a significant increase in women’s involvement in startups.

The percentage of females as founders themselves or being one of the founding members of a new company has followed an upward trajectory over time.

Take a look at the data from Statista showing the percentage of startups in the United States having at least one female among their founding members. 

• 2017 – 22% of all startups in the United States have at least one female founding member during the year
• 2018 – 24% of all startups in the United States have at least one female founding member during the year
• 2019 – 26% of all startups in the United States have at least one female founding member during the year
• 2020 – 28%t of all startups in the United States have at least one female founding member during the year

Top 10 Global Startup Ecosystems 

The Global Startup Ecosystem Report 2021 from Startup Genome revealed that half of the locations with the healthiest startup ecosystems come from the United States. 

They were evaluated based on the organization’s nine “success factor” standards and approximately a hundred business metrics centered on overall market performance, availability of funding, connectedness, talent, experience, and business knowledge.

Rank 1 – Silicon Valley, United States. The undisputed tech haven consistently ranked first in the GSER over the last five years

Rank 2 – London, United Kingdom and New York City, United States tied at the second spot for two consecutive years

Rank 4 – Beijing, China

Rank 5 – Boston, United States

Rank 6 – Los Angeles, United States

Rank 7 – Tel Aviv, Israel

Rank 8 – Shanghai, China

Rank 9 – Tokyo, Japan

Rank 10 – Seattle, United States

50% of all the locations with the healthiest and top-performing startup ecosystems, as evaluated by Startup Genome, come from the US.

The remaining 27% are from Asia, while 17% are from Europe.

Five Top-Performing US Locations and their GSER Scores

Take a look at the GSER scores of the top five US locations that made the list.

Silicon Valley 

• Performance – 10/10
• Funding – 10/10
• Connectedness – 10/10
• Market Reach – 10/10
• Knowledge – 10/10
• Talent – 10/10

As can be seen from the data above, Silicon Valley achieved perfect scores all across the board.

Meaning, the location has ticked every parameter needed to be considered a top-performing startup ecosystem.

New York City 

• Performance – 10/10
• Funding – 10/10
• Connectedness – 10/10
• Market Reach – 10/10
• Knowledge – 5/10
• Talent – 10/10

New York City achieved full scores in almost all categories but fell significantly short in the Knowledge Success Factor.

Boston 

• Performance – 9/10
• Funding – 9/10
• Connectedness – 9/10
• Market Reach – 9/10
• Knowledge – 5/10
• Talent – 10/10

Like New York City, Boston also lagged on the Knowledge Success Factor which assesses patents and research.

Los Angeles 

• Performance – 9/10
• Funding – 10/10
• Connectedness – 3/10
• Market Reach – 9/10
• Knowledge – 7/10
• Talent – 9/10

Los Angeles needs to improve on the Connectedness Success Factor which measures an ecosystem’s ability to connect with the global fabric of knowledge critical to a startup’s survival

Seattle 

• Performance – 9/10
• Funding – 7/10
• Connectedness – 7/10
• Market Reach – 8/10
• Knowledge – 7/10
• Talent – 8/10

Seattle fared well across all success factors, without recording a disproportionate low in one parameter.

On the other hand, the ecosystem did not record any full score which means there is still wide room for improvement left.

What Does a Startup Mean?

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All startups can start as small businesses but not all small businesses are startups. While we often confuse these two terms, they are actually different in many disciplines.

According to Investopedia, a company can be considered a “startup” if it is in the initial stages of business, and which, for this reason, is seeking outside investment to get its ideas out in the open. 

Its objective is entirely different from a small business, with the latter targeting to just make a living out of a business enterprise while the former wanting to expand and grow to possibly become a billion-dollar entity in the long-term. 

This is why startups bring new ideas to the table that have never been made before.

They want to “disrupt” the industry by offering something new, with the possibility of offering efficient solutions to problems never realized before.

According to Forbes, a startup can graduate into a “larger firm” once it clocks an annual revenue worth $20 million or more, and a workforce consists of at least 80 employees.

Conclusion

There are more than 70,000 startups in the United States in 2023.

The country is known to be offering one of the healthiest business climates all across the globe, offering easy access to funding, supportive government regulations, and the availability of a knowledge-based talent pool that helps new enterprises thrive and grow.

Five in ten top-performing global startup ecosystems are found in America, led by Silicon Valley which achieved full scores all across the board.

This means that aspiring entrepreneurs should seriously consider the United States as their business base.

Thank you for reading our article about how many startups in the US are there in 2023.

Sources