Startups Are Abandoning Suburbs for Cities With Good Transit

But high-tech startups have become increasingly urban in the past decade or so, gravitating to dense neighborhoods in downtown San Francisco and Lower Manhattan, which have supplanted Silicon Valley as the nation’s leading centers for such startups.

Now a new study finds a close connection between transit access and startups of all types—not just high-tech startups. The study, by Kevin Credit from the Center for Spatial Data Science at the University of Chicago, uses advanced spatial econometric techniques to examine the connection between transit and business startups in five cities. Two of them, San Jose (Silicon Valley) and Austin, are well-documented startup hubs with underdeveloped transit infrastructure; two others, Philadelphia and Cleveland, have reasonably well-developed transit systems but low rates of startup activity; and Boston has both a high level of startup activity and an established transit system.