Does Location Matter to VC Investors?

In our Monday post, we highlighted data from a recently published Kauffman Foundation report, comparing and ranking metro locations based startup density.  The report takes a look at the years 1990 and 2010.  We compared venture capital investment for those two years to see if the cities with high startup density were also attracting venture capital investment.

As we’ve noted before, it is difficult to detect a trend from a single year of venture capital investment data.  As long term investors, who invest between the coast (in regions not typically robust with venture capital investment) we continue to see pockets of innovation attracting startups.  As those regions continue to flourish, venture capitalists will follow.  While location is a factor venture capitalists take into account when evaluating a company for investment, it typically isn’t the deciding factor.