We love living in a city of big ideas. And we know that investors, startups and entrepreneurs are looking for real results, and a way to measure success. The good news is, we’re seeing all the right leading indicators to show that we’re moving forward at an exponential pace.
The data shows Houston is one of the fastest growing startup ecosystems globally. That’s why Houston was recognized as a top 25 city for Rate of Entrepreneurship in a Surge Cities analysis with Inc., and a top city for the emerging life sciences market by CBRE. Though there are many reasons entrepreneurs are making Houston their home, here we want to highlight two that were recently called out in Startup Genome’s 2019 Global Startup Ecosystem Report.
Life Sciences Spotlight
As home of the Texas Medical Center—the largest medical complex in the world—Houston has all the tools to be a leader in life science innovation. The infrastructure is here in the form of 21 research organizations, eight R&D hospitals, and the TMC Innovation Institute, which includes Johnson and Johnson’s Center for Device Innovation, JLabs, the AT&T Foundry for Connected Health, and the TMCx accelerator, which is one of the country’s largest life science business accelerators focusing on early-stage digital health and medical device companies.
Earlier numbers from TMC Innovation show that 251 companies with the Innovation Institute have garnered 371 customer engagements and amassed $900 million in total raised or committed funding.
We expect more success stories with the completion of the medical center’s multi-institutional 30-acre research campus, TMC3. The campus, projected to be open in 2022, will bring together the best institutions in clinical care, research and industry. According to the Greater Houston Partnership, it will create nearly 30,000 jobs and bring $5.2 billion to Houston’s economy.
AI, Big Data, and Analytics
Houston has long been known as a hub for oil, gas and energy; it is, after all, home to the world’s biggest concentration of Forbes 2000 energy companies. While there’s a fair share of corporations that fuel the city’s economy, startups find success in creating products with wide-ranging applications. In addition to oil and gas-centric AI startups like Arundo Analytics—a Station Houston alum which recently raised $25 million—there are also successful companies like Zdaly, a data search platform that unifies data science, machine learning and external trends to deliver predictive business insights.
Local venture capital firms are poised to fund Houston-based innovators in these areas. Mercury Fund in particular focuses specifically on Data Science and AI platforms. We expect funding in this area to increase in the months and years to come.
As MassChallenge’s Houston Managing Director (and former Director of Strategy at Houston Exponential) Jon Nordby noted in the Startup Genome report, “Houston is now home to approximately 15 venture funds, compared to only one fund a little over two years ago.”
One example of a non-local firm increasing their Houston presence is Austin-based LiveOak Venture Partners, which partnered with Houston Exponential for its HX Venture Fund earlier this year. LiveOak focuses on providing first institutional capital for tech and tech-enabled services companies based in Texas, largely focusing on Austin-based companies prior to the partnership. “The Houston market opportunity has always been strategic for us and the recent spike in entrepreneurial activity makes it even more so,” said Krishna Srinivasan, LiveOak’s managing partner.
With a slew of new accelerators on the horizon this year, the opportunities for growth are endless.