Seattle - The Rise of the next global innovation hub
Over the last several years I have been studying the Seattle innovation economy, it's history, and a snapshot of where we are today. Seattle has come a long way, but has a ways to go before it can claim the mantle of a global innovation center. Here is a bulleted summary.
A Brief History Of Seattle’s Innovation Economy
1851 – Seattle is founded by the Denny Party Scouts
1852 – Henry Yesler builds steam sawmill and becomes first Seattle Millionaire. Seattle dominates lumber industry.
WWI – Rise of Maritime and ship building industries
1916 – Boeing Company Founded leading to major aerospace industry
1962 – World’s Fair brings 10 million people to Seattle, and leaves
behind the Space Needle, Alweg Monorail, Key Arena, Seattle
Center, and other foundational structures.
1975 – Microsoft founded by Bill Gates and Paul Allen, leads to
dominance in computer operating system software with
Windows during PC revolution
1994 – Amazon is founded by Jeff Bezos who left D.E. Shaw in NY for
Seattle, and became a leader in ecommerce, and now many
other industries
Make-Up Of Seattle’s Innovation Economy Today
Aerospace – Thanks to Boeing the aerospace industry accounts for 11% of Greater Seattle’s Economy and employs 132,500 workers in 1,350 firms
ICT (Tech) – Thanks to Microsoft and Amazon the Information and Communications Technology sector generates $18.6 billion in state income and employs 200,000 people in 14,000 firms
Life Sciences – Thanks to UW Medical, the Fred Hutch, Allen Institute and other healthcare organizations, Washington State generates $11.1 billion in income from healthcare and life sciences
Amazon Impact – In Seattle Amazon generates $400 million in taxes, employs 30,000 people and growing, and occupies 10 million SF of office space or roughly 25% of total premium downtown office space
Ranking of Seattle’s Innovation Ecosystem including IP (High)
UW is the 5th most innovative University in the country as ranked by Reuters
UW is #2 in total federal funding with over $1.3 billion mostly life sciences
Microsoft ranks #4 and Amazon ranks # 7 in R&D funding globally
Pacific Northwest National Laboratories (PNNL) spent over $1 billion in R&D
Ranking of Seattle’s Start-Up Ecosystem (Med/Low)
New start-ups nationally have declined 40% since 1978 to 530,000 start-ups per year in 2015
Kauffman Foundation ranks Greater Seattle start-up activity 26 out of 40 metro areas in 2016
Kauffman Foundation ranks Greater Seattle rate of start-up growth 22 out of 40 metro areas in 2016
Boston has 5X the number of VC firms (approximately 80 versus 15) and 4X the annual VC investment compared to Greater Seattle, and is a similar size city
Of 8,600 tech companies in Seattle less than 10% have greater than 20 employees, however, high growth companies account for 50% of new jobs
Ranking of Seattle’s Local and Regional Ecosystem (Med)
Seattle ranks in the top 5 among U.S. cities for livability, and livability is one indicator of the attractiveness of a city for talent
Livability, however, is being negatively impacted by rapid population growth, which is expected to increase by 38% through 2040 when Greater Seattle is expected to become 14th largest metro area
Seattle tied for fourth worst city for travel congestion behind LA, SF, and NY
Seattle K-12 public schools rank in the bottom quartile especially in STEM
Seattle has 3,000 tech jobs that go unfilled every year due to lack of tech labor, and UW only graduates 375 computer science degrees per year
80% of Seattle tech workforce has come from out of state
Ranking of Seattle’s Global Ecosystem (Med)
Global Innovation Exchange (GIX) is a partnership between UW, Tsinghua University and China with $25 million in backing by Microsoft to help graduate 3,000 tech workers over time
UW is planning an innovation district near UW to house start-ups, satellite offices of mainstream tech companies, and UW students and faculty starting companies
WA is evaluating an innovation corridor between Vancouver BC – Seattle – Portland to facilitate the free flow of human and financial capital
Gates Foundation is attracting global philanthropic and healthcare talent
