Boston Startup Scene Guide - Fall 2013


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A detailed review of the Boston startup scene - covering big and small companies and clusters that make the Boston community so special.

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  • We have all the right ingredients and are solving hard problems. We have huge diversity in industries and are creating breakthroughs in tech. We need to shout loud and proud about what's here.
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  • Note that when I refer to Boston, I’m really referring to the Boston metro area, which includes all of MA and parts of New England.
  • MIT, in particular, has been a start-up company factory33,600 companies founded by MIT affiliates; 25,800 are currently activeEmploy 3.3M people and generate $2T in sales250-300 new companies started each year by students and alumniEnduring giants: Campbell Soup, Gillette, Bose, HP, Intel, TI, Genentech, Raytheon, Qualcomm, iRobot, AkamaiMIT Technology Licensing Office (TLO) 2011:305 patents filed, 199 issued20 companies started with VC or $50k of other funding$54M in revenues from royalties and equity
  • Harvard University and Harvard Business School have also been factories for innovation.
  • On a per capita basis, Massachusetts has a significant advantage over other leading technology states, with 76 engineering degrees awarded per 100,000 residents, compared to 51 in Virginia.
  • Education and university research leads to NIH funding – with over $2 billion in NIH funding pouring into basic research into the region.
  • VC Investments are very, very concentrated in the US. 70% of all VC $ flows into 3 states.Massachusetts has always been a strong #2 to California. But when you look at the numbers on a per capita basis (which is what entrepreneurs care more about – after all, it’s not very relevant how much capital is invested in China, what’s relevant is how concentrated that capital is)…California = 14,128.8M ; pg 14 on NVCA YearbookMass= 3,067.9M = $3BNew York = 1,856.8M = 1.8B
  • …you can see that Boston is the top region of the three major markets. Per capita is, after all, a proxy for how capital is available PER ENTREPRENEURCalifornia: 14.1B/38.3 M*= $368Massachusetts: 3.0B/6.6M = $454New York: 1.8B / 19.5M = $92*pulled population estimates from 2012 census
  • Every major life sciences company is expanding in Boston and Cambridge.The gene mapping happened at the Broad Institute, which has expanded to a multi-hundred million dollar budget world-class research institute.Highlights of the PwC 2007 Life Sciences Survey include: Ninety-nine percent of respondents with R&D in Massachusetts reported that they plan to maintain or increase their R&D activities in the state over the next two years.Almost half of respondents with manufacturing operations have these operations in Massachusetts, and over half of those expanded their manufacturing over the past year. Nearly six out of ten (59%) expect to increase manufacturing activities in Massachusetts over the next two years.Two-fifths of respondents said their intellectual property was developed at a Massachusetts academic institution.Massachusetts Life Sciences Initiative, a ten year, $1 billion package of investment resources designed to foster continued growth in the Massachusetts Life Sciences Supercluster signed in 2008.Harvard Medical School and Massachusetts General Hospital doctor, Dr. Jack Szostak (SHAH'-stak), won Nobel Prize for 2009 for research into how chromosomes protect themselves from degrading when cells divide. Of the top 25 biotechnology research and development firms in Massachusetts, 14 are in Cambridge, and account for 2/3 or $1.175 billion--of R&D spending by the top 25 biotechnology firms.
  • Obama administration pledge $150B over next 10 years, says clean tech can generate 5 million new jobs.MA passed comprehensive energy bill in 2008 that placed it at forefront of clean energy in the US.Force utility companies to invest in home-grown energy that is cheaper in long-run.Encourage investment in renewable energy.Incentivizes businesses and individuals to invest in energy-saving products.NECEC – New England’s Clean Energy Economy, brought together Clean Energy Roundtable and piloted Fellowship Program to transition entrepreneurs from other industries into clean energyGreatPoint Energy, Mascoma, Evergreen Solar, Agrivida, MIT’s Ignite Clean Energy CompetitionEnerNOC was named 2007 Top IPO in New England by ACG and Mass High Tech, for its $99MM IPO.
  • There are more iPhone developers are using the Skyhook location API than in any other state, a rough proxy for all iPhone developers$100M+ exits in mobile:M-Qube, mobile billing company, acquired by VeriSign for $250MMMobile advertising company Enpocket bought by NokiaAOL acquired mobile advertising network Third Screen MediaStrong Boston mobile industry:10 VC-backed mobile companies in 2002 to 45 in 2008Quattro, Skyhook Wireless, Jumptap, vLingo
  • robotics: iRobot, Kiva Systems, Rethink Robotics, Robotics, Droid Workscloud computing: Netezza, Carbonite, Akamai, Nasuni,EMC, Akamionline video:  Brightcove, Blackwave, Scanscout, Visible Measuresgaming:  WorldWinner, Harmonix, Turbinee-commerce:  RueLaLa, CSN Stores,, TripAdvisor, Vista Print, Cartera Commerce, Zoom Info, KarmaLoop, DemandWaremarketing technology:  DataXu, HubSpot, Click Squared, Jingle, Constant Contact
  • A quick shuttle ride or Acela ride away, you have New York, the world’s advertising and media headquarters3 of world’s top 6 advertising agencies have digital teams headquartered in BostonPublicis/Digitas, Aegis/Isobar, Havas DigitalHistorical media strength and customersEasy flow of talent and capital between Boston and New YorkBzzAgent, DigitalArbor, DataXu, ScanScout, Brightcove and other marketing and digital production portfolio companies, have CEOs in NYC weekly and local sales teamsBoston VCs investing in NY media companies – Flybridge, Spark, General Catalyst
  • Cisco:$3.5B on nine acquisitions of Boston-based companiesNew 5000-employee New England Development CenterMicrosoft:Boston Concept Development Center: research unit incubating new Internet businesses within companyCapacity to double current 550 MA employees by 2010Google:Rapid expansion of employment to 50 in Boston, with plans to doubleBoston as data networking center: Ericsson and Siemens also have headquarters in the city; Nokia has a big presence
  • Events:Mobile Monday – Monthly meet-up of mobile and wireless startups, VCs, and tech execs.Open Coffee – Open meeting for entrepreneurs every Thursday at Andala Coffee House in Cambridge.WebInno –Venrock organized monthly meeting of 200 to 400 startup people, VCs, Angels and tech execs. Resources:BetaHouse Boston – Co-working office space for entrepreneurs. Cambridge Innovation Center - Flexible office facility for growing technology and life sciences companies.DogPatch Labs - Polaris Venture Partners’ creation to connect entrepreneurs and help founders conceive and launch startups. Organizations:TechStars - A startup boot camp that provides $25K in funding with lots of mentorship, advice, introductions, and access to investors.Stay in MA is funded by Flybridge Capital Partners and is committed to providing as many scholarships as possible, to Massachusetts college students, up to a total of $10,000 total per calendar year.
  • Named by 2ThinkNow as the #1 most innovative city in the world and “Under30CEO” as the #1 city for young businesspeople, Boston has a rich heritage of start-ups, and is poised to continue with that heritage well into the 21st century. It’s all here.
  • Boston Startup Scene Guide - Fall 2013

    1. 1--Confidential What Makes Boston’s Start-Up Scene Special? Jeff Bussgang General Partner Flybridge Capital Partners Fall 2013
    2. 2--Confidential  Intellectual Capital – academia, innovation, diverse industries and ideas  Venture Capital  Advisors, Angels, Accelerators  Successful Companies – to partner, poach and/or sell to Ingredients for a Vibrant Start-Up Ecosystem
    3. 3--Confidential Historical Leadership
    4. 4--Confidential MIT – Factory of Innovation
    5. 5--Confidential Harvard – The Business-Side Partner
    6. 6--Confidential Other Colleges and Universities
    7. 7--Confidential - 1,000 2,000 3,000 4,000 5,000 6,000 Patents Issued Per Capita (M) - 2011 2011 Innovation Leadership: Patents Source: US Patent and Trademark Office
    8. 8--Confidential Innovation Leadership: #1 NIH Funding Source: NIH (2008); Center for an Urban Future
    9. 9--Confidential Innovation Economy Is Densely Concentrated
    10. 10--Confidential Geographic Clusters Benefits of High Concentration 495 Corridor 128 Corridor Cambridge/Boston
    11. 11--Confidential Boston’s Innovation District
    12. 12--Confidential “Highest Density Cluster of Innovation on the Planet” Kendall Square
    13. 13--Confidential Next Up: Harvard - Allston
    14. 14--Confidential Venture Capital: Regional Comparison California: $14.1B New York: $1.8B Massachusetts: $3.0B Total VC Investment 2012 Source: NVCA 2013 Yearbook
    15. 15--Confidential Venture Capital Per Capita California: $368/person New York: $92/person Massachusetts: $454/person VC Investment Per Capita 2012
    16. 16--Confidential Life Sciences Leadership
    17. 17--Confidential Boston’s Energy Sector
    18. 18--Confidential High Technology MicroClusters: For Example, Strength in Mobile • Hundreds of iPhone developers in MA • Over 50 VC-backed mobile start-ups • Six 9-figure exits: • Jumptap (Millenial Media) • Where (PayPal) • Quattro (Apple) • Enpocket (Nokia) • M-Qube (Verisign) • Third Screen (AOL) • Other mobile leaders • Adelphic Mobile • Fiksu • RunKeeper • SavingStar • SessionM • Skyhook iPhone developers using location API
    19. 19--Confidential Other MicroClusters Cloud Computing Online Video Gaming Marketing Tech Education
    20. 20--Confidential Proximity to NYC: A Huge Plus
    21. 21--Confidential BOSTON–BASED LIQUIDITY IN LAST 24 MONTHS: IPOS IPOs (17) Market caps as of 09/5/2013 * Indicates IPO filing             $360M* $815M $237M* $580M $286M $392M $1.3B $848M $193M TBD* $1.8B $388M $333M $1.3B $6.2M $11.6B $363M    
    22. 22--Confidential BOSTON–BASED LIQUIDITY IN LAST 24 MONTHS: M&A Market caps as of 09/5/2013 M&A >$500M (5) $775M $700M $1.1B     $500M $1.8B 
    23. 23--Confidential EMERGING PLATFORM COMPANIES MARKET CAPITALIZATION Market caps as of 9/5/2013 $54B $28B $15B $12B $8B $6B $4B        $55B $33B $18B $9B $4B $3B      
    24. 24--Confidential Expansion of Major Tech Companies
    25. 25--Confidential Start-up Resources
    26. 26--Confidential Investors and Entrepreneurs to Follow Investors Blog URL Twitter Fred Destin / Atlas @fdestin Rob Go / Next View @robgo Chip Hazard / Flybridge @chazard Bijan Sabet / Spark @bijan David Skok / Matrix @bostonvc Michael Skok/Northbridge @mjskok Entrepreneurs Blog URL Twitter David Cancel/Hubspot @dcancel Wayne Chang/Crashlytics @wayne Diane Hessan/Commun. @CommunispaceCEO Rob May/Backupify @robmay Jules Pieri/DailyGrommet @julespieri Dharmesh Shah @dharmesh
    27. 27--Confidential Harvard Start-up Resources HBS EIRs 2013 Ajay Agarwal Gordon Bloom Chuck Davis David Hornik Eric Paley Jules Pieri Ruben Pinchanski Rudina Seseri Jim Sharpe Steve Sydness Diego Rodriguez Ray Rothrock Tony Tjan Russ Wilcox Campus Resources NYC STARTUPTREK
    28. 28--Confidential Conclusion: Boston Ranked #1 City of Global Innovation Economy #1 Boston