The Global Startup Ecosystem Report (GSER) 2024 presents a comprehensive analysis of the global startup economy, highlighting the resilience of Artificial Intelligence (AI) and Cleantech amid ongoing economic challenges.

Compiled by Startup Genome, the report draws insights from over a decade of research and data from 4.5 million startups across 300 ecosystems worldwide.

Despite the economic downturn triggered by inflation, geopolitical tensions, and fears of recession, startups focused on Generative AI (GenAI) and Cleantech have continued to thrive.

GenAI attracted 18% of global venture capital funding in 2023, making it one of the year’s top-performing sectors.

Cleantech, driven by the urgency of climate action, has also shown significant growth, particularly in Europe.

The report paints a complex picture of global VC funding. While Series A funding fell by 46% in 2023 compared to 2022, average deal sizes increased, signalling that investors place larger bets on fewer startups.

Early signs of recovery were evident in the first quarter of 2024, with a slight uptick in investment, particularly in sectors like AI and Cleantech.

Traditional startup ecosystems such as Silicon Valley, New York City, and London continue to lead global rankings, but emerging regions are making significant strides. 

Tokyo broke into the top 10 for the first time, climbing five spots, while Seoul and Miami also showed substantial improvements, highlighting the growing influence of non-Western ecosystems in global innovation.

The GSER 2024 emphasizes the importance of smaller, non-traditional ecosystems in the global innovation landscape.

Regions like Shenzhen, Paris, and Shenzhen have seen marked improvements in international rankings. Shenzhen, for example, rose seven positions, underscoring the shift in capital flow and innovation to newer regions.

Government policies are pivotal in fostering these emerging ecosystems.

Countries like Kenya, with its Konza Technopolis, and Saudi Arabia, which has invested $40 billion in AI, are positioning themselves as major players in the global startup economy.

Meanwhile, European nations are leading in Cleantech due to long-term policies such as the European Union’s Horizon program and the Emissions Trading System, which have created favourable conditions for green innovation.

Another critical theme in the report is the scaling of startups globally. Startups that serve most foreign customers are more than twice as likely to reach valuations exceeding $50 million and achieve unicorn status.

Governments are increasingly supporting these scaleups through mentorship and commercialization efforts, ensuring that homegrown startups succeed internationally.

One of the report’s more intriguing findings is the evolving landscape of unicorn creation.

While the number of new unicorns dropped by 58% in 2023 compared to 2022, there were signs of recovery in early 2024, with 25 new unicorns emerging in Q1 alone.

Sectors like Deep Tech and GenAI were at the forefront of unicorn creation, with corporate venture capital playing a critical role in boosting startup valuations.

The report also provides insights into how regional ecosystems are evolving. 

North America remains a powerhouse, home to 18 of the top 40 global ecosystems, including Silicon Valley, New York City, and Los Angeles. However, ecosystems like Tel Aviv and Tokyo are showing rapid growth, driven by advances in AI and other frontier technologies.