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What Makes Boston’s Start-Up Scene Special?

Jeff BussgangGeneral Partner, Flybridge Capital PartnersSenior Lecturer, Harvard Business School

Fall 2015

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Intellectual Capital – academia, innovation, diverse industries and ideas

Advisors, Angels, Accelerators- seed $ Venture Capital – scale $, mentorship Successful Companies – to partner, poach

and/or sell to

Ingredients for a Vibrant Start-Up Ecosystem

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Historical Leadership

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MIT – Factory of Innovation

33,600 companies, 300

each year, employ 3.3

million people, generate

sales of $2 trillion,

300+ patents each year

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Harvard Is No Slouch

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Other Colleges and Universities

74 colleges and universities in Boston-area, 265,000 students, 8 research universities pump $7 billion into economy, spending $1.5 billion on R&D yearly, 264 patents, 280 commercial licenses.

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MA VA WA CA MD TX NC NY0

0.20.40.60.8

11.21.41.61.8

Location Quotient (LQ)

Mass Tech Sector - Most Concentrated in US

Source: MassTLC State of Technology Report – 2015LQ is a way of defining how concentrated an industry cluster is compared to the national average

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Innovation Economy Is Densely ConcentratedPopulation: 640k Boston, 4.5m Greater Boston Area40% of workforce in an innovation economy sector

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Geographic Clusters Benefits of High Concentration

495 Corridor

128 Corridor

Cambridge/Boston

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“Highest Density Cluster of Innovation on the Planet”Kendall Square

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Boston’s Innovation District

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Next Up: Harvard - Allston

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Venture Capital: Regional Comparison

California: $85B

New York: $20B

Massachusetts: $20B

VC Capital Under Management - 2014

Source: NVCA 2015 Yearbook80% of total VC $ in these 3 regions

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Venture Capital Per Capita

California: $3.7k/person

New York: $1.0k/person

Massachusetts: $4.3k/person

VC Capital Under Management Per Capita - 2014

Source: NVCA 2015 Yearbook, US Census, CA is counted as four MSAs (LA, SF, San Jose, San Diego)

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Proximity to NYC: A Huge Plus

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Leading Clusters: Life Sciences Leadership

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Leading Clusters: Boston’s Energy Sector

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MicroClusters Matter:For Example, Mobile

• Over 100 VC-backed mobile start-ups

• Seven >$100M exits:• Crashlytics (Twitter)• Enpocket (Nokia)• Jumptap (Millenial Media)• M-Qube (Verisign)• Quattro (Apple)• Third Screen (AOL)• Where (PayPal)

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Other MicroClusters

Robotics

Cloud Computing

Cybersecurity

Health IT

E-Commerce

Marketing Tech

Education

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Strong Community of Women Tech Leaders#2 “Top Cities for Female Entrepreneurs” - Forbes

Cynthia BrezealJibo

Wendy CebulaEdX

Abbie CelnikerEleven Bio

Michelle Dipp Ovascience

Gail GoodmanConstant Contact

Helen GreinerCyPhy/iRobot

Bettina HeinPixability

Sheila MarceloCare.com

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Market caps as of 9/8/2015

$47B

$38B

$17B

$13B

$10B

$5B

$5B

$71B

$49B

$31B

$11B

$10B

$8B

$5B

Tech Life Sciences

Boston-Based Platform Companies Market Capitalization >$5B

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Expansion of Major Tech Companies

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Start-up Resources

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HubWeek Example: October 3-10

• Register: http://ow.ly/RSnmh

Michael Sandel’s MasterClass at Fenway

http://www.harvard.edu/hubweek

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Harvard Start-up Resources

1. Ajay Agarwal – Bain Capital2. Julia Austin – Austinfish3. Steve Bonner – Cancer Treatment4. David Chang – Paypal5. Sam Clemens – InsightSquared6. Chuck Davis – TCV7. David Frankel – Founder Collective8. Janet Kraus – Peach/Circles9. Sharon Peyer – Hitbliss10. Jules Pieri – The Grommet11. Ruben Pinchanski – Digitas12. Katie Rae – Techstars Boston13. Duke Rohlen - Spirox14. Rudina Seseri – Fairhaven Capital 15. Martin Sinozich – Venn Capital16. Jim Sharpe – HBS/Extrusion Tech17. Michael Skok – Assemble18. Jim Southern – Pacific Lake19. Russ Wilcox – E Ink/Transatomic

NYC STARTUP TREK

BOSTONTREK

Campus ResourcesHBS EIRs – 2015-16

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Investors and Entrepreneurs to Follow

Investors Blog URL TwitterRob Go / Next View robgo.org @robgoChip Hazard / Flybridge hazard.typepad.com @chazardBijan Sabet / Spark bijansabet.com @bijanDavid Skok / Matrix forentrepreneurs.com @bostonvcMichael Skok / Assemble mjskok.com @mjskokEntrepreneurs Blog URL TwitterDavid Cancel/Drifft davidcancel.com @dcancelDavid Chang/ex-PayPal @changdsWayne Chang/Twitter waynechang.com @wayneDiane Hessan/StartUp Inst @DianeHessanSean Lindsay/Tapjoy @rseanlindsayJules Pieri/DailyGrommet jules.thegrommit.com @julespieriDharmesh Shah/Hubspot onstartups.com @dharmeshMike Troiano/Actifio medium.com/@miketrap @miketrap

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Conclusion: Top Ranked Innovation City It’s All Here Waiting For You