Why VCs Prefer Silicon Valley Investments

Silicon Valley

Chart: VC-Backed Tech Exists Since 2012

When you’re looking for investors, where you’re working can have an awful lot to do with your success. One reason: More tech companies in Silicon Valley pay off for VCs than in any other region of the country.

According to researcher CB Insights, tech companies in Silicon Valley made up 52 percent of the value from the 50 largest venture-backed exits so far this year. If you include Facebook’s IPO, the number rises to 86 percent.

Digging In

While Silicon Valley startups represent the majority of deal action from IPOs to buyouts, New York accounts for just 10 percent, Massachusetts 8 percent, Southern California 6 percent and Illinois 4 percent.

Silicon Valley’s performance isn’t a flash in the pan. According to CB Insights, the Valley accounted for 48 percent of exits in 2011 and 42 percent of their valuation.

Image: zimmytws/Shutterstock.com

One Response to “Why VCs Prefer Silicon Valley Investments”

  1. bluemountain184

    Well, this dispels the notion that “low tax and regulation = pro-business” stuff conservatives have been saying to ages.
    Interesting that practically none of the states mentioned are so called “Red” states where taxes and regulation might be low, but with lower levels of investment in infrastructure and education, the human capital is also low, hence, it doesn’t foster new businesses.
    Not surprised at all.