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Start-up ecosystem report: China is rising while the United States is in decline

Startups are a gamble, but it is possible to better understand why some thrive and many others die watching the ecosystems in which they operate. This is the mission of eight-year-old Startup Genome, composed of a group of researchers and entrepreneurs who annually interview thousands of founders and investors around the world to better understand what changes in the regions where they operate. and what remains stubbornly the same.

The main goal is to find ways to help more startups succeed, and the company – which this year surveyed 10,000 founders with the help of partners like Crunchbase and Dealroom – produced some data that should perhaps concern the United States. China seems poised to surpass US dominance in many technology sectors. Consider: In 2014, only 14% of the so-called unicorns were based in China. Between the beginning of last year and today, this percentage has risen to 35%, while in the United States, the number of unicorns grown in the country has dropped by 61%. % to 41% of the world total.

It could be argued that investors simply attribute to China-based start-up companies unrealistically high valuations, as is the case here in the United States, and we believe in part that this is true . But China is clearly "winning" on the basis of patents, with four times more claims related to AI and three times more patents related to crypto- and blockchain registered in China the year last. With so much of the technology industry now focused on advanced technology, it should be noted. In fact, even though we hated the January Chronicle of the Financial Times written by the famous VC Michael Moritz, who suggested that American companies follow the example of China, its underlying call to arms was probably unpredictable to his way.

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What else should startups know? According to the discoveries of Startup Genome in addition to the rise of AI, blockchain and robotics, there are also declining subsectors, including, unsurprisingly, adtech, who has seen his last five years. There is no doubt that this is directly related to the growing dominance of Facebook and Google, which accounted for 73% of all US digital advertising last year, according to research firm Pivotal shares.

That does not mean that adtech startups are cooked, notes the authors of the study. On the contrary, declining subsectors are often "mature" but can be revived by new technologies. In this case, while funding for adtech has dropped, virtual reality and augmented reality may well inject new growth into the industry at some point. Perhaps.

Whatever it is, for us, the most interesting aspects of this report – and it's really worth considering – are the links that it can establish by discussing with so many people around the world. It discusses, for example, how Stockholm, a relatively small startup ecosystem, is able to produce significant startups at a significant rate, compared to Chicago, whose ecosystem is ostensibly three times larger. (The answer: The founders of Stockholm start-ups are apparently better connected to the seven best ecosystems in the world.)

The conclusions of the report on founding women, who establish more relationships with the founders of the region and who are more locally connected than their male counterparts, are very interesting, with the exception of investors. This is bad news for founding women and investors because local connectivity is associated with better start-up performance.

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To read the full report, click here. You must enter your e-mail address, but with 240 pages filled with fascinating nuggets and other useful information, you will probably find that it is worth it.