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These five cities are emerging as credible rivals to the world’s biggest tech hub Silicon Valley.

Sydney skyline

These five cities are emerging as credible rivals to the world’s biggest tech hub Silicon Valley.

When we think of tech entrepreneurship and startup culture, Silicon Valley still remains the golden standard. But many worthy competitors have risen up the ranks to challenge its title as the home of innovation. New York City, affectionately known as the “Silicon Alley,” and one of the world’s largest financial centers, has unsurprisingly established itself as the second best option for startups.

With low tax rates for new startups, generous government grants, and easy access to entrepreneurial visas, London has also become one of the world’s fast-growing hubs for startup creation. And that success looks likely to continue—one 2014 research study showed that London (and East England’s) tech sector was growing at a faster rate than Silicon Valley.

But for every big name, there are a number of smaller cities that are beginning to create their own startup ecosystems and thriving tech industries—many of which are beginning to rival Silicon Valley in attracting foreign investors and public interest.

From the excitement of the surging Tel Aviv to the ingenuity of the established Sydney, here are five cities around the world making a play to become the newest “valley” for startup development.

Tel Aviv

When you hear people talking about Tel Aviv as a rapidly growing tech hub, one of the first things usually described is the sheer energy and enthusiasm the city generates. People might be out late socializing at a Tel Aviv port club, but are working just as hard at one of the 5,000 startups the city boasts. ZUtA Labs, a company that makes portable, palm-sized printers, and Kaltura, a software company, are two recent success stories in the city’s tech sphere. Recently securing $116 million in funding, Kaltura partners with companies like Philips and Gogo to publish, monetize and analyze their video content on an open source platform.

According to the Startup Genome Process, Tel Aviv has 61 companies publicly traded on the NASDAQ—more than the whole of Europe—and more startups per capita than anywhere in the world. How did the city become a startup hotspot? A few important cultural characteristics could be at play. Peter Nguyen of the Brand Ingenuity Group attributes the success of Tel Aviv to a deeply ingrained system of networking, community, and openness to sharing contacts. He also notes that Israeli's strong immigrant culture can also lead to increased risk-taking and a desire to innovate.


After years of slow business growth, Moscow is now well on its way to becoming a big name in global enterprise. One of the faces of Russian startup culture is the Skolkovo Foundation, an organization founded by Dmitry Medvedev in 2010. The foundation was developed to promote the country’s tech scene as a viable economic alternative to using natural resources. International companies like Samsung, Intel, Microsoft and more have partnered with Skolkovo to build their research and development teams, while bolstering homegrown Russian startups at the Skolkovo Innovation Center.

A recent partnership between Skolkovo and MIT is offering young entrepreneurs the educational foundation to help them launch their own ventures. And for this growing tech and creative class, Moscow offers a valuable aspect that makes the city fertile for startups: it’s a place to disrupt and to take chances. Coub is one such example. Founded by brothers Anton and Igor Gladkoborodov, Coub is an app and video sharing site described as a combination of a GIF and video service Vine. They’ve already opened an office in New York City, and, according to the company’s figures, have already attracted over 50 million unique users.


Bangalore’s decades-long presence as an IT hub made it a matter of time before entrepreneurs utilized India’s huge, talented workforce in new ways. Major companies like PayPal have invested in the country’s workforce, and more recently, in female employees. India currently beats other, more “progressive” countries like the United States in its percentage of women working in tech—some predictions say that the proportion of females working in tech could increase from roughly 25 percent to 33 percent in 2016.

The city is still an evolving ecosystem for venture capitalists. With companies like car rental service Zoomcar, which has secured $11 million in funding from Sequoia Capital, and Edureka, a startup that provides online training courses for coding and software development with certifications available in anything from Salesforce to Java, Bangalore’s scene will continue to attract global attention. Andrew Tibbitts, the director of TechHub, said in an interview: “If a company isn’t taking advantage of the Indian market, they’re missing out on one of the largest emerging technology markets in the world and the incredible R&D experience and innovation it affords.”


Last December, Sydney continued its evolution as a competitive tech force when Australia's Prime Minister—and noted tech enthusiast—Malcolm Turnbull pushed for a national “ideas boom,” instead of one based on resources. Entrepreneurs like Greg Muller of Gooroo welcomed the attention and pushed for the one thing any growing tech scene needs: space for innovation. This national attention has paid off: 2014 report Jobs in the Australian App Economy showed jobs in computer systems design (i.e. programming and software development) had grown by 38 percent since 2008, beating 22 percent in the U.S. and 10 percent in the U.K.

A renewed focus on innovation is on display in two of Sydney’s hottest new startups. Canva, a platform of easy-to-use graphic design software, just completed a $21 million fundraising round in 2015, and the buzzy, futuristic Eora 3D has made 3-D printing an accessible reality for consumers. One major benefit to Sydney's reputation as a major tech player is its high quality of life—a hospitable climate and friendly, diverse population make the country a desirable place to build a life. As Jonathan Barouch, CEO and founder of social media metrics tool Local Measure, said in an interview with Virgin, "Culturally, Sydney is still young and there is a very real sense that anything is possible. It is easy to get excited about business in Sydney, which makes doing business here exciting.”

São Paulo

Brazil’s economic capital is producing an impressive number of startups. Home to over 2,700 startups, the city is Latin America’s most prosperous startup ecosystem and is increasingly attracting the attention of many international investors. Thanks to its easy access to investment capital and a number of accelerators like Aceleratech and Startup Farm, and ambitious co-working spaces like Cubo, São Paulo is fostering a productive and inspiring environment for a number of enterprises like e-commerce site Dafiti—which raised close to $250 million in its first rounds of equity funding—and social network Kekanto. And even Google has taken notice: The company has chosen São Paulo as the next home for its popular Campus workspace.

These ventures also reflect the collaboration and economic prosperity that proved so successful in Silicon Valley. With additional support from federal programs like Tech Sampa and Startup Brazil offering large grants to approved projects, the country is finding its groove as a major player in tech and enterprise.

No endorsement or connection is meant between those featured in this article and Chivas.

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