Despite concerns about San Francisco's decline, new data reveals Silicon Valley remains the global hub for venture-backed startups. According to Crunchbase, startups in the Bay Area attracted $90 billion in venture capital (VC) funding in 2024, accounting for 57% of the $178 billion invested globally.

San Francisco’s role as a nucleus of AI development was a significant driver. OpenAI, headquartered in the city, not only raised substantial funding but also cultivated a thriving ecosystem of AI-focused startups. Other notable beneficiaries include Databricks with a record-breaking $10 billion, xAI securing $12 billion across two rounds, and Anthropic raising over $8 billion. Waymo, based in Mountain View, contributed with its $5.6 billion Series C funding.

The Bay Area's startup success stems from more than just AI. The region boasts longstanding advantages, including a dense network of venture capital firms, incubators like Y Combinator, and proximity to big tech companies such as Google, Nvidia, and Salesforce. This infrastructure, combined with an unmatched talent pool, continues to attract startups and investors alike.

Data from SignalFire shows that 49% of Big Tech engineers and 27% of startup engineers are located in the Bay Area. These engineers often transition into startup founders, creating a self-perpetuating ecosystem. Founders also cite the region’s unique advantages in talent availability and customer proximity as key reasons for relocating their businesses to Silicon Valley.

Anh-Tho Chuong, co-founder and CEO of Lago, an open-source billing platform, highlighted the benefits of operating in San Francisco. “We feel like the talent pool is better. Also, the customer pool is better,” Chuong stated.

As of 2025, Silicon Valley shows no signs of slowing down, maintaining its position as the epicenter of global innovation and venture capital.

SOURCE: TECHCRUNCH | PHOTO: GETTYIMAGES