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October 19, 2018
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Google Pixel 3 XL review

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The smartphone arms race isn’t always pretty. The knock-down, drag-out fight between Apple and Samsung in particular has given rise to some nasty lawsuits and wincing commercials year in and out as the two companies invest millions in outdoing one another.

But Google is playing another game entirely. The company has never really been concerned with battling it out over flashy designs and specs. It’s really exactly the sort of approach you’d expect from a software-first company. I won’t go so far as to suggest that the Pixel 3 is a utilitarian phone, but it’s safe to say that the hardware exists in service of the company’s software innovations.

If it were like other companies, last week’s hardware event would have been an opportunity for Google to bask in processor speed and pixel density. Instead, it blew through such things. It was a strange spectacle to behold, really, as someone who’s been through a million of these things. The company more or less announced all of the products at once and moved onto more important topics like algorithms and machine learning.

For many intents and purposes, Google’s approach to smartphones is a breath of fresh air. From a more practical standpoint, the company’s path often means less radical hardware upgrades, year over year. If you’re wondering whether to upgrade from the the Pixel 2, the simple answer is: no, what are you, made out of money? But here’s Taylor’s slightly more nuanced approach to the question, if that’s your thing.

The fact is that Google has always been less interested than Apple or Samsung in keeping you beholden to the constant upgrade cycle. In fact, a number of the new photo features introduced this round will also be making their way onto older models, when possible. That’s not a promise all of the competition is willing to make.

The bottom line for products like the Pixel 3, Pixel Slate and Home Hub is that Google is intent on delivering the best hardware showcase for what it’s been working on over on the software side. That we happen to get one of the best Android smartphones out of the deal is a happy side effect.

Top level, here are the key hardware changes from the last version:

  • Bigger screen: This the single largest hardware change, so to speak. The Pixel 3 bumps up from five inches to 5.5 inches, while the XL moves up in the world from six to 6.3. Both a pretty sizable upgrade, all told.
  • Dual front-facing cameras: Seemingly a bit of a head scratcher, given that the back of the device sticks to one. More on that below.
  • Wireless charging: Better late than never, right?

We walked away from the Google event with both handsets in a branded tote bag that also included the new Pixel Stand. It’s clear that the company was looking to outfit reviewers with the best experience possible. As someone who cycles through a lot of phones for work, I’ve found myself gravitating toward larger phones.

With that in mind, most of the rest of this piece pertains to my experiences with the Pixel 3 XL. That said, Anthony kindly agreed to take the Pixel 3 out on the town for a photo safari, so the imaging samples in this review are taken from both handsets. Spec-wise, the two products are quite similar, beyond the standard array of things that come with a larger phone: screen, battery, et al.

There’s a sentiment you’ll read a lot when it comes to large flagships — that the company has done a good job keeping the footprint small, in spite of the massive screen size. Indeed, a lot of progress has been made on this front in recent generations, between thinner bodies and the rapid extinction of the bezel. That said, the Pixel 3 XL is a big phone by just about any measure.

Sure, Apple came from behind, only to rocket to the top of display sizes with the 6.5-inch XS Max. But the 6.3-inch XL isn’t far behind. It’s also a few fractions of a millimeter thicker than Apple’s massive handset at 7.9mm — though it still has nothing on the Note 9’s 8.8mm. Either way, the thing isn’t for the small of hand or limited in pocket space — and one-handed use probably isn’t in the cards if you’re not a professional basketball player.

Not much has changed aesthetically changed since the 2. And, indeed, the Pixel’s design language has become iconic in its own way, from the brightly colored power button to the dual-surface rear. The plasticky version found on prior generations has been replaced with a double glass surface — shiny up top and matte on the bottom.

It’s a subtle contrast and should help avoid slippage for those souls brave enough to go without a case. This last bit is a very real issue I’ve run into switching between the iPhone XS and Note 9, of late. Those shiny backs will slip right out of your hand if you’re not paying attention.

Up front, you’ll find that word of the Pixel 3 XL’s notch was, in fact, not exaggerated. It’s the stuff of legend. Turns out this is because of those dual front-facing cameras. Google is really committed to helping users up their selfie game here. At least that’s the immediate impact of that decision.

Dual cameras could have other benefits down the road, including depth sensing for things like augmented reality and, perhaps, face unlock. For now, however, it means taking pictures of yourself and friends at a semi-pro level.

The notch, it turns out, is a key design distinction between the 3 and 3 XL. The reasoning is — as with the rest of what Google’s hardware team did here — a pragmatic one. “With the small one,” VP of Product Management Brian Rakowski told me in an interview last week, “it turns out the space is just too small when you put the wide-angle lens in. It’s a narrower phone, so you have room for an icon or two, whereas on the bigger phone everything you need for the status icons is up there, and it’s a very good use of the space.”

In spite of its software embrace with Android Pie, Google is neither definitively pro or anti-notch. The company is, simply put, notch agnostic. If, however, you have a problem with that admittedly unsightly cutout, there’s a fix for thatActive Edge is back. It’s a feature that’s grown on me a bit since HTC introduced it as Edge Sense back on the U11 in May of last year. With a pinch of the phone’s frame, you can fire up Assistant. It’s one of several ways to invoke Google’s AI, but it definitely beats Samsung’s longtime insistence on including a devoted Bixby button. And besides, Google Assistant is actually, you know, useful.

Google’s generally done a good job listening to user feedback with its software features, and nowhere is that better represented than with the Adaptive mode for its screen color profiles. Last year’s Natural mode was met with some fairly widespread negative feedback for the effect in had in “muddying” the colors — most notably the reds, which ended up somewhere between blood-red and brown.

It was one of those things the company insisted was good for you, but ultimately user irritation won the day. Adaptive splits the difference, saturating colors for things like your Gmail icon, while keeping it in check for things like skin tone. It’s a pretty happy medium, all told, but if you’re not into it, you can always adjust things in settings.

The headphone jack is, of course, still gone. Google drew a line in the sand last year, after making a show keeping it on-board with the first generation. There’s a bit of a mea culpa here, however, in the form of souped up earbuds included in-box. The headphones are very clearly inspired by last year’s Pixel Buds.

That, much like the accessories themselves, is a bit of a mixed bag. The biggest upshot here is that the things plug directly into the USB-C port at the bottom. Sure the box still includes a headphone jack to USB adapter, but including headphones with a standard jack with a phone that doesn’t natively support the tech is downright bizarre.

The looping up top is a nice way to keep the buds in your ears without those bizarrely sharp fins that so many headphone makers rely on. I took the headphones for a run this morning and they didn’t fall out once.

The headphones also offer a number of the Pixel Buds’ software features free of charge, including easy access to Google Assistant and real-time translations through the Google Translate app.

The downside, on the other hand, is a major one. Even as far as free in-box headphones go, the Pixel USB-C earbuds are uncomfortable. This, I will be the first to admit, is a wholly subjective thing and highly dependent on the size and shape of our earholes. But man, the thing hurt to put in and take out, outdoing Apple’s last generation free buds for discomfort levels.

This is a space where companies can learn a lot from Samsung. The earbuds that ship with the Galaxy S9 and Note 9 are fantastic. I’m actually using them right now, plugged into my MacBook, in spite of not having a Samsung device anywhere near my person.

That said, the on-board sound has been improved, courtesy of the addition of front-facing speakers.

Interestingly, battery capacity has been increased for the Pixel 3 (from 2,700 to 2,915mAh), but not the Pixel 3 XL — in fact, it’s actually gone down slightly (from 3,520 to 3,430). That’s no doubt part of why the company was a bit cagey about this particular spec, only really mentioning battery as it pertains to the new charging tech.

As the company told me at the event, the ultimate goal is making sure battery life either stays constant or improves, courtesy of a combination of hardware and software. Battery was a focus for Android Pie, which should help offset some of the mAh loss on the XL. In my own testing, I was able to get just over a full day with standard usage — around 27 hours, all told. Not immaculate, but not bad.

Running the battery down did, however, give me occasion to appreciate the estimates that kick in when you’re critically low on juice. Android estimates when it thinks you’ll be completely SOL, shifting expectations as you change your usage. It’s either a lifesaver or source of anxiety depending on how you absorb such information.

The Pixel Stand, meanwhile, is a smart little accessory. At $79, it’s one I’d consider strongly if picking up the handset. Granted, it lacks the ambition of Apple’s three-product-charging AirPower, but among its other clear advantages is the fact I’ve held it in my hand and can confirm it’s a real thing that actually exists. The accessory takes advantage of that glass back to charge wirelessly via the Qi standard.

The stand is soft and silicon and fairly minimalist, designed to go unseen when not in use. When it is, however, it transforms the Pixel into a makeshift Home Hub, serving up Google Photos and bringing a visual component to Assistant. It’s a clever take of the charging stand — and hopefully a good enough excuse to stop you from falling asleep with your phone every night.

Okay, okay — it’s time to talk about the camera. We’ve got one of our reviewers doing a really in-depth testing on the Pixel camera, which you’ll be able to read as a standalone in the near future. For now, a couple of quick things to note.

The camera situation is a bit counterintuitive. There’s a second front-facing camera, while the back of the device bucks the industry standard of moving to two — or even three — lenses.

Rakowski again, “We look at all of the different configurations we can get. If we would have added another lens, it would have given us no benefit over what we get with one really good lens.”

That means, like the latest iPhone, the upgrades here are more software than hardware. If anyone gets the benefit of the doubt on that front, it’s Google. The company’s been making great strides in imaging, courtesy of silicon and machine learning, all of which were well demonstrated on the Pixel 2.

The Pixel 3 continues that grand tradition with some really impressive strides. Best of all, unlike many of the camera software tricks introduced by competitors in recent years, many of these additions are majorly useful day to day applications.

The camera software has HDR+ on by default — a smart move on Google’s part. While many users will buy the new Pixel based on photo performance, an even larger percentage of owners are unfamiliar with photog terms like HDR. I speak from experience, having personally enabled the feature on many friends’ phones.

In Google’s application, the feature snaps eight frames more or less instantly, digitally stitching them together in a matter than impressively captures uneven light settings in a single frame. In fact, this kind of burst shooting is the key to many of the Pixel 3’s best features.

Take Top Shot. The feature utilizes the many frames taken when making a Motion Photo. Once the shot is taken, swipe up and you can scroll through the images on a timeline to pick the frame you want. Generally, the AI does a solid job picking the ideal image, but the ability to customize (assuming users can locate the feature) is certainly welcome.

That customization carries over into features like Portrait Mode. The Pixel has long done a solid job with the feature in spite of not having a full two cameras for depth sensing. Instead, the phone uses a dual lens to approximate a depth map. And while camera suppliers would no doubt argue the benefit of including a full second or third camera, it’s hard to quibble with the results here. Once a shot is taken, you can manually adjust the blurred-out bokeh effect behind the subject.

[Standard v Super Res Zoom]

Super Res Zoom also stitches together pieces of a photo to offer up a zoomed-in version. Here the tech actually builds upon your own shaky hands, using algorithmic tech to fill in the holes. It’s still no match for the optical zoom of telephotos like the one found on the new iPhone, but it definitely improves upon stand zoom.

[Left: iPhone XS, Right, Google Pixel 3 XL]

Night Sight, meanwhile, uses multiple shots to improve the color on low-light shots. It’s a clever workaround for a lack of dual-apertures, doing a fine job of brightening up photos. That said, there’s still noticeable noise on photos shot in dark settings. 

More camera features worth noting:

  • Playground is a fun one-stop shop for augmented reality stickers. There are Star Wars and Avengers in there, among others. This is Google’s fun addition to the camera software. There are no Animojis or AR Emojis here, thanks to the lack of face detection, but it’s a fun glimpse at the future of in-camera AR.
  • Lots of additional selfie options. The dual front-facing cameras means wide-angle selfies, for cramming in a larger group. The camera software, meanwhile, corrects the standard fish-eye lens distortion.
  • Photobooth mode, meanwhile, will snap a shot when you smile.

  • Lens continues to impress. Check out the above shot of the thank you page from Adrian Tomine’s Killing and Day, which pops up faces and bios for those fellow authors mentioned.

A Google exec recently told me that price wasn’t really a factor when building hardware. In all things, however, the company is pragmatic. Google’s move away from the ongoing spec wars means the company isn’t chasing premium hardware for the sake of itself. That ultimately benefits the user from a pricing perspective.

Google doesn’t lead with the fact that the Pixel 3 starts at $799, but in a world full of flagships that start at $200 more, maybe it should. Sure, it’s not exactly cheap, but these days, it feels like a downright steal for a top-tier flagship.

Like its predecessor, the Pixel 3 isn’t about flash. It is, however, another solid showcase for Google’s impressive innovations.

News Source = techcrunch.com

Echo Show 2 review

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With the original Echo Show, Amazon added a new dimension to the smart speaker. To critics, the device was little more than a station tablet. For Amazon, however, the product unlocked a new vertical in the rapidly expanding category. The day to usefulness wasn’t always clear, but the potential certainly was, as Amazon and the competition looked to corner the smart home market.

Like most of the company’s first generation products, however, the hardware wasn’t great. The first Show was big and clunky. It looked dated before it even arrived in living rooms and kitchens. But it got the job done.

While the company hasn’t released sales figures for the product, the first gen clearly sold briskly in its early days, according to rankings. The numbers were ultimately hobbled by a war with Google that resulted in YouTube being pulled from the platform, but on a whole, the device appears to be a hit.

It’s already inspired a number of copycats. In January, Google announced a new Smart Display category relying on third parties to product their own Assistant-powered take on the device. And later this week, it’s expected to introduce its own competitor, the Home Hub. It’s fitting, then, that the second-gen Show bears Google’s unmistakable influence. Heck, it’s kind of theme in this latest batch of Echo devices.

There’s little question that the new show is much better looking product than its predecessor. The big, thick, plasticky look has been traded in for something a bit more homey, with a softer, fabric covering. The front, which was previously home to both display and speaker, is now all screen — meaning those tablet comparisons aren’t going away any time soon.

Still, from a pure design perspective, Lenovo’s Smart Display is the one to beat. It’s still far and away the best looking of the bunch — though the aforementioned Home Hub could give it a run for its money in the near future.

The design choice means there’s a lot more room for screen, which has been increased from seven to 10.1 inches (with a still fairly sizable bezel). That extra real estate makes the product a more compelling offering for watching short videos or episodic TV shows (I don’t know that I’d recommend it for a full film just yet) and finally offers enough space for something like a browser to make sense on the product.

The speaker, meanwhile, has been moved to the rear of the device. It’s a decision that makes sense from an aesthetic perspective, but is a bit less than practical. When listening to music while writing this review, I found myself actually flipping it around.

Sound quality has been notably improved with improved drivers and Dolby bass, but things get a bit muffled when faced away from you. The bass is also a bit too powerful for its own good here, contributing to a muddying of the sound quality. Thankfully, Alexa now understands you when you ask her to turn down the bass.

Things improve a bit when you place it around six inches from a wall, reflecting the sound back at you. Of course, not every home set up can accommodate that orientation. Either way, I wouldn’t recommend looking to the Show as your primary music listening device. Apple and Google’s high end speakers simply sound better — or build your own using the various modular pieces the company announced at its last event.

With a larger display, the new Show demands touch. Amazon clearly recognized this during the redesign. While, like its predecessor, it’s designed to be voice-first device touch-based interactions are more prevalent here.

Exhibit A is the addition of Firefox. It’s a bit of a strange one. You can call it up with an, “Alexa, open Firefox,” but actually browsing the web is a bit trickier. There’s no skill yet for, say, “open TechCrunch.com in Firefox.” Rather, you’ll have to open Firefox and either type the URL with two fingers, or click the microphone icon to speak it.

It’s a nice option certainly, if a bit clunky. Also, there’s no multitouch pinch to zoom here — in fact, so far as I can tell, there’s no way to zoom in at all. What the browser does afford, however, is a workaround for YouTube. Say “Alexa, open YouTube,” and the Show will offer you the choice of watching content in either Firefox or the Silk browser. Sure, it’s not ideal compared to a native app, but until the companies kiss and make up, or, more likely, Amazon launches its own competing service, it will have to do.

The other big news here is a bit of a no-brainer. After bringing smart home hub functionality to the Echo line with the Plus, Amazon has done the same with the Show. The smart screen now features a Zigbee hub inside. Connecting devices is pretty straightforward — just put them in pairing mode and say “Alexa, discover my devices.” If everything goes right, the whole process should take under a minute.

Thankfully, an app redesign has arrived alongside the new devices, so those smart devices can be accessed on your mobile device, along with the Show. The app also lets users routines around groups of devices, so you can, say, turn up the lights, turn on the coffee and get the day’s news (shudder) with an “Alexa, good morning.”

The new Show is nice upgrade over its predecessor. It’s better looking, has a bigger screen and improved (if backwards) speakers, while smart home hub functionality and last year’s addition of security camera monitoring make it a control panel for the smart home. The ball is in your court, Google.

News Source = techcrunch.com

Marshall’s Kilburn II is a ruggedly handsome bluetooth speaker

in Delhi/Hardware/India/kilburn/marshall/Politics/Reviews by

Marshall hasn’t been been shy about capitalizing on its legacy. The legendary English amplifier company has plastered its name on cans of beer and a line of refrigerators. It’s not the most crass branding we’ve seen, but it’s pretty damn silly.

At first glance, the same can be said for its line of bluetooth speakers and headphones, save for one important thing: they’re actually quite good. It’s been several years since the company branched out into consumer electronics, and along the way, it’s been remarkably consistent with the products that bear its iconic cursive logo.

Announced this summer at IFA, the Kilburn II doesn’t stray far from the familiar Marshall amplifier style. In fact, you’d be forgiven if you mistook the thing for a practice amp. Instead, it’s just a solidly built bluetooth speaker with a rubberized faux leather design that can take some serious bumps. It’s further ruggedized by way of a chainlink metallic grille up front.

The speaker is water resistant, so you can take it outside without much concern. That said, if you need a true all-weather speaker, I’d recommend looking at something from JBL. The Kilburn isn’t going to go swimming with you, but it’ll withstand a little spilt whiskey.

The sound quality is decent for speaker of this size. It’s not the best sound I’ve heard out of a bluetooth speaker, but if you’re looking for something portable to fill up a small room, it’s a pretty solid choice, and the treble and bass knobs up top will help you find find the perfect medium.

Unlike most bluetooth speakers, the Kilburn requires a proprietary plug for charging. That means no microUSB/USB-C. That’s understandable though, given the massive on-board battery, which should give more than 20 hours of life on a charge, watching the series of red bars creep down in the meantime.

At $299, it’s not a cheap bluetooth speaker, but it’s solid as far as the price point goes. It’s not going to replace your audiophile sound system any time soon, but at least it will look nice sitting next to your vinyl collection.

News Source = techcrunch.com

Amazon Echo Dot 3 review

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Amazon has sold a lot of Echo Dots. Like a crazy, silly, unfathomable number of the things. Over the past two generations, it has arguably become the single-largest driver of the smart speaker craze.

There’s nothing exceptional about the product, of course. It’s a simply designed hockey puck of a product, designed to mostly stay out of sight. But it’s a hard thing to resist — even for those who’ve been reluctant to embrace the category.

It’s a dip in the water, a gateway drug into the strange new world of smart speakers. So, how to improve upon Amazon’s best-selling device? The trick is adding to the experience while not impacting its biggest selling point: the fact that it’s $50. That sort of price point gives you considerably less wiggle room than with, say, a $1,000 phone.

Announced at an event in Seattle last month alongside eight million other new Alexa products, the new Dot marks more than just a simple upgrade to the line. It represents a way forward for the Echo line. It’s a product that bears Google’s unmistakable influence, while pointing toward the place the modular speaker system will occupy in the smart home going forward.

It’s the mark of Google that really strikes you right out of the box. The first two generations of the product were utilitarian. They weren’t much to look at, but rather a gateway to Alexa, designed to be hidden away. Granted, fabric covers are all the rage now in consumer electronics, but the new Echo’s cloth perimeter bears more than a passing resemblance to Google’s Home Mini.

Amazon was understandably shaken by Google’s rapid ascent in the category. Days before the Alexa event, Strategy Analytics noted that the Home Mini had surpassed the Echo Dot as the best-selling smart speaker for the quarter. It’s not exactly panic mode, but it’s a pretty clear indication that it’s time for an upgrade.

While the new Dot draws some clear aesthetic influence from the Home line, I prefer Amazon’s take. It splits the difference between old and new in a nice way. The fabric cover doubles as a speaker grille, running along the outside of the product. The top, meanwhile, maintains a familiar design language, with a rounded matte black top bearing a quartet of physical buttons. The light-up status ring runs flush between these two surfaces.

The new Dot is notably larger than its predecessor — a bit of a surprise, given that the more compact size was the second-gen Dot’s biggest selling point. That said, the fact that the new device looks nice enough to be displayed out in the open no doubt emboldened the company to make it a bit larger. It’s a solid thing, too. I was a bit surprised by the heft of the puck — you could do some serious damage with the thing.

One of the upshots of the larger footprint is the volume increase. The new Dot is capable of getting 70 percent louder than its predecessor (by Amazon’s count). The move finds Amazon putting a stronger emphasis on the second part of the “smart speaker equation.” The sound system on earlier Dots wasn’t built for much beyond giving Alexa voice. That’s why the company built in an auxiliary output.

That’s still here, of course, but the built-in sound output is much improved. It’s also a lot less distorted at top volume. I still wouldn’t use it as my default speaker, but the Dot’s role in Amazon’s new à la carte sound system is an interesting one.

The company sent along two Dots for the sole purpose of trying out the new stereo pairing feature — and I’m glad they did. It’s probably the most interesting addition to the line. In the revamped Alexa app, you’ll find the Create a Speaker Set option under the Settings tab. From here, you can turn two Dots into a stereo pair. The setup is simple — though I did run into some trouble on our office Wi-Fi. Both Echos need to be on the same network in order for the feature to work properly, and the app wasn’t quite able to discern that they, in fact, were.

The app will walk you through the process and let you determine which device will handle which channel of the stereo track. Paired together, it’s a nice experience — kind of a small-scale home theater experience. Add in the new Echo Sub and it’s even better. Keep in mind, of course, that you’ve just spent $230. Things add up fast. Of course, that’s still $100 cheaper than the HomePod.

Of course, it’s unfair to compare the two. Amazon and Apple’s speakers are in entirely different leagues. But the new Dot and other additions to the Echo home stereo system represent a very Amazon approach to the category, giving users the ability to mix and match devices, while still maintaining a low price point.

The third-generation Dot isn’t a complete reinvention of the wheel, but it’s big enough to warrant an upgrade for many users. Though perhaps “upgrade” isn’t the operative word here. Given Amazon’s ultimate goal of an Alexa device in every room, it’s easy to see it becoming yet another addition to your growing collection.

News Source = techcrunch.com

Study says the US is quickly losing its entrepreneurial edge

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Photographer: Daro Sulakauri/Bloomberg

According to a new study conducted by the Center for American Entrepreneurship and NYU’s Shack Institute of Real Estate, the US may be losing its competitive advantage as the dominant nucleus of the startup and venture capital universe. 

The analysis, led by senior Brookings Institute fellow Ian Hathaway and “Rise of the Creative Class” author Richard Florida, examines the flow of venture capital over 100,000 deals from 2005 to 2017 and details how the historically US-centric practice of venture capital has become a global phenomenon.

While the US still appears to produce the largest amount of venture activity in the world, America’s share of the global pie is falling dramatically and doing so quickly.

In the mid-90s, the US accounted for more than 95% of global venture capital investment.  By 2012, this number had fallen to 70%. At the end of 2017, the US share of total venture investment had fallen to just 50%.   

Over the last decade, non-US countries have propelled growth in the global startup and venture economy, which has swelled from $50 billion to over $170 billion in size.  In particular, China, India and the UK now account for a third of global venture deal count and dollars – 2-3x the share held ten years ago.  And with VC dollars increasingly circulating into modernizing Asia-Pac and European cities, the researchers found that the erosion in the US share of venture capital is trending in the wrong direction.

Growth of global startup cities and the myth of the American “rise of the rest”

We’ve spent the summer discussing the notion of Silicon Valley reaching its parabolic peak – Observing the “rise of the rest” across smaller American tech hubs.  In reality, the data reveals a “rise in the rest of the world”, with startup ecosystems outside the US growing at a faster pace than most US hubs.

The Bay Area remains the world’s preeminent beneficiary of VC investment, and New York, Los Angeles, and Boston all find themselves in the top ten cities contributing to global venture growth.  However, only six of the top 20 cities are located in the US, while 14 are in Asia or Europe.  At the individual level, only two American cities crack the top 20 fastest growing startup hubs.  

Still, the authors found the bulk of VC activity remains highly concentrated in a small number of incumbent startup cities. More than 50% of all global venture capital deployed can be attributed to only six cities and half of the growth in VC activity over the last five years can be attributed to just four cities.  Despite the growing number of ecosystems playing a role in venture decisions, the dominant incumbent startup hubs hold a firm grip on the majority of capital deployed.

China and the surge of mega deals

Unsurprisingly, the largest contributor to the globalization of venture capital and the slimming share of the US is the rapid escalation of China’s startup ecosystem.

In the last three years, China has captured nearly a fourth of total VC investment.  Since 2010, Beijing contributed more to VC deployment growth than any other city, while three other Chinese cities (Shanghai, Hangzhou, Shenzhen) fell in the top 15. 

A major part of China’s ascension can be tied to the idiosyncratic rise of late-stage “mega deals”, which the study defines as $500 million or more in size.  Once an extremely rare occurrence, mega deals now make up a significant portion of all venture dollars deployed.  From 2005-2007, only two mega deals took place.  From 2010-2012, eight of such deals took place.  From 2015-2017, there were 80 global mega deals, representing a fifth of the total venture capital activity.  Chinese cities accounted for half of all mega deal investment over the same period.

The good, the bad, and the uncertain

It’s not all bad for the US, with the study highlighting continued ecosystem growth in established US hubs and leading roles for non-valley markets in NY, LA, and Boston.

And the globalization of the startup and venture economy is by no means a “bad thing”.  In fact, access to capital, the spread of entrepreneurial spirit, and stronger global economic development and prosperity is almost unquestionably a “good thing.”

However, the US’ share of venture-backed startups is falling, and the US losing its competitive advantage in the startup and venture capital market could have major implications for its future as a global economic leader.  Five of the six largest US companies were previously venture-backed startups and now provide a combined value of around $4 trillion. 

The intense competition for talent marks another major challenge for the US who has historically been a huge beneficiary of foreign-born entrepreneurs.  With the rise of local ecosystems across the globe, entrepreneurs no longer have to flock to the US to build their companies or have access to venture capital.  The problem attracting entrepreneurs is compounded by notoriously unfriendly US visa policies – not to mention recent harsh rhetoric and tension over immigration that make the US a less attractive destination for skilled immigrants.  

At a recent speaking event, Florida stated he believed the US’ fading competitive advantage was a greater threat to American economic power than previous collapses seen in the steel and auto industries.  A sentiment echoed by Techstars co-founder Brad Feld, who in the report’s forward states, “government leaders should read this report with alarm.”

It remains to be seen whether the train has left the station or if the US can hold on to its position as the world’s venture leader.  What is clear is that Silicon Valley is no longer the center of the universe and the geography of the startup and venture capital world is changing.

The Rise of the Global Startup City: The New Map of Entrepreneurship and Venture Capital tries to illustrate these tectonic shifts and identifies tiers of global startup cities based on size, growth and balance of VC deals and investments.

News Source = techcrunch.com

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