The Triangle got a national nod this week for its penchant for digital innovation and thriving local startup ecosystem. 

Ranked fourth in a national evaluation of America’s best cities to lead the digital economy, Raleigh-Durham stood out for its concentration of dynamic startups leading the charge in health and tech innovation. It fell just behind Boston, San Francisco and Denver. San Diego ranked fifth. 

Led by the U.S. Chamber of Commerce Foundation, The and Washington D.C. startup hub 1776, the second annual Innovation That Matters 2016 report includes analysis of 25 US cities. Researchers indexed data sets across a series of city-specific attributes, including: talent, capital, industry specialization, density, institutional connectivity along with cultural statistics. They conducted a comprehensive survey of more than 330 startup leaders. 
Researchers also met with public and private industry leaders in each city to evaluate the various environmental conditions contributing to ecosystem leadership. A roster of local startup founders along with leaders from key academic, corporate and civic institutions participated in organized roundtable focus groups to help researchers identify both successes and opportunities for improvement. 
In Durham in late January, local participants included: Mason Ailstock, Research Triangle Park; Laura Baverman, ExitEvent; Anil Chawla, Archive Social; Kevin Davis and Dennis Newman of Duke University’s Office of information and Technology; Chris Heivly, The Startup Factory; Derrick Minor, City of Raleigh; Brett Wolfe, Microsoft; and Adam Klein, American Underground. 
That roundtable led researchers to identify the following key levers attracting entrepreneurs to the area: strong openness to new ideas, a high quality of life and a favorable regulatory environment. 
“The Triangle ecosystem works because of the low friction between universities, startups and civic entities. There is a long history of collaboration between these different spheres, especially with the creation of RTP, that makes it easy to build and sustain conversations within the entrepreneurial ecosystem,” says Klein, chief strategist of American Underground (ExitEvent’s parent company). “I’d contend that and the density of startups activity in downtown nodes will be crucial to our future success.” 
Collectively, the Triangle scored highly in the report in the areas of culture (1), ecosystem connectivity (3) and talent (5) compared to the remaining 24 cities. Lower scores were distributed for density (7), industry specialization (11) and access to capital (14). 
While highlighting Raleigh-Durham’s most significant attributes, the report also addressed areas of concern that could impact the region’s long-term growth and success: 
  • The lack of urban density and sophisticated transportation systems could threaten continued population growth as these factors are at the core of major cities that offer a live/work/play environment and access to more efficient transportation options throughout downtown employment hubs. 
  • While healthtech startups are driving the region’s most significant entrepreneurial growth, demonstrable activity in the EdTech and Energy Tech space remain remiss and an area of opportunity for growth and leadership. 
  • Despite boasting notable academic institutions across the region, university integration in the local entrepreneurship community was rated 12th, citing a need for continued integration and partnership. Also of concern is the drop of the region’s educated young people who could otherwise be talent prospects or business leaders. 

Despite that Raleigh-Durham has a smaller startup ecosystem than other cities on the list researchers found that it stands out shines due to its interconnectedness, deep talent pool and a growing density of startup activity beyond its metropolitan areas. In short, they add, the region has all of the necessary ingredients in place to continue to compete and win.