Dubai is the World's Fastest-Growing Startup Ecosystem

Dubai is the world's fastest-growing startup ecosystem, followed by Detroit, according to a recently released report by PitchBook, which ranked VC ecosystems in global cities for development and growth in global cities. The report produces two kinds of scores: Development Scores, which rank cities for how robust their VC ecosystems are, and Growth Scores, which rank cities for the growth rates of their VC ecosystem.

Development scores examine factors like track records for raising capital for GPs, having high deal activity, and producing exits by VC-backed companies. Growth Scores looked at the momentum of VC deals, exits, and fundraising activity in the short, medium, and long term. While cities with high growth scores may not have a large or well-developed VC footprint, they may present better value for investments and growth potential. 

Dubai was ranked the fastest-growing VC ecosystem. Growth score rankings found that 65% of the 20 fastest-growing VC ecosystems are in Europe and the US. European cities ranked better for high-growth VC ecosystems than they did for established ones, with cities like Milan, Tallinn, Madrid, and Vienna featuring among the top 20. Only three (15%) cities in Asia were ranked among the 20 fastest-growing VC ecosystems - compared to 40% for the best-ranked development ecosystems. Dubai is the only Arab city featured on both lists. 

Together, the US and Asia were found to house 85% of the 20 most developed VC ecosystems. San Francisco was ranked by far the most developed VC ecosystem in the world, followed by New York. The report, which tracked investment over six years between Q3 2017 and Q2 2023, found $364.5 bn invested in San Francisco-based startups, compared to less than half that figure for startups based in New York. The 20 most robust VC ecosystems ranked included Los Angeles and Boston in the US, Beijing and Shanghai in China, as well as Seoul and Tokyo. US cities accounted for nine out of the top 20 VC ecosystems. London and Berlin were the only two European cities ranked among the top 20.