For all the chatter about San Francisco’s decline, data repeatedly shows that the Bay Area, including the city itself, is still the best place for venture-backed startups.
New statistics released Tuesday show Bay Area-based startups vacuumed up $90 billion in VC investment by 2024, which was 57% of the $178 billion in U.S. venture funding spent last year. from Crunchbase demonstration.
In 2024, San Francisco-based OpenAI was apparently the mothership, both for creating a nearby AI startup industry with its own startup fund and the VC dollars it raised for itself. But others include San Francisco’s Databricks and its record-breaking $10 billion in funding. Elon Musk’s xAI, which raised $12 billion in two rounds last year and immediately moved into OpenAI’s old headquarters in San Francisco’s Mission District. Mountain View’s Waymo and its $5.6 billion Series C. San Francisco’s Anthropic, which raised over $8 billion in 2024. and big raises in 2024 from San Francisco’s Scale AI and Perplexity.
And, as we mentioned earlier, this is not just a coincidence. It’s a result of the region’s dominance of artificial intelligence, the biggest technology of 2024, as well as the headquarters of Big Tech (Google, Nvidia, Salesforce, etc.) and the long-standing startup infrastructure there — from Y Combinator to the VC Land of Sand Hill Road.
This self-fulfilling cycle shows no signs of flagging in 2025, in part because the Bay Area still offers the largest concentration of skilled tech workers. About 49% of all Big Tech engineers (often the startup founders of tomorrow) and 27% of startup engineers are located there, according to data from SignalFire.
With such a high density of everything from financiers to engineers, meeting the people necessary to build a startup is just easier, say the founders, who relocated to San Francisco in 2024. “We feel like the talent pool is better. Also, the customer team is better,” Anh-Tho Chuong, co-founder and CEO of open source billing platform Lago, told TechCrunch.
Correction: This post has been updated to reflect total funding for the US only, not global.
