Which Universities Produce the Most Venture Capital-Backed Companies?

Private equity data provider Pitchbook is out with their annual report on which universities produce the most venture capital (VC)-backed companies?  Before looking, which universities would you guess show up on the list?

Would you guess Ivy League schools, with their highly ambitious, academically fresh graduates?  Perhaps you’d guess universities in places where the state government’s tax policy and regulations are more favorable to entrepreneurship?

Here’s the look.

The Top 10

The top university for creating VC-backed companies is – drum roll please – Stanford.  The California-based institution has seen 1,178 VC-backed entrepreneurs, 1,015 companies, and a whopping $28.84 billion in capital raised.  Stanford has been in first place for a while.  Will a university ever knock the Cardinal out of first place?

Interestingly, another California-based university sits in second place.  The University of California at Berkeley has had 1,137 entrepreneurs, 1,012 companies, and $20.78 billion in capital raised.

Rounding out the top five are third place Massachusetts Institute of Technology (941 entrepreneurs/819 companies/$21.24 billion capital raised), Harvard University (900 entrepreneurs/799 companies/$25.35 billion raised), and the University of Pennsylvania (838 entrepreneurs/757 companies/$15.82 billion in capital raised).

Are you surprised by which universities show up at the top of the list?  Stanford, University of California at Berkeley, Massachusetts Institute of Technology, Harvard, and the University of Pennsylvania.  All well-respected universities, two of which are Ivy League institutions and two of which are top California-based schools.

Perhaps somewhat surprisingly, two states – California and Massachusetts – make up 80 percent of the top 5.  This is generally consistent with the geographic breakdown of venture capital raised by state.

With the top 5 established, which universities would you guess show up ranks six through ten?

The bottom half of the top 10 includes Cornell University (750 entrepreneurs/693 companies/$20.10 billion in capital raised), University of Michigan (712 entrepreneurs/638 companies/$12.07 billion in capital raised), Tel Aviv University (640 entrepreneurs/531 companies/$7.91 billion in capital raised), the University of Texas (636 entrepreneurs/582 companies/$7.70 billion in capital raised), and the University of Illinois (526 entrepreneurs/484 companies/$9.94 billion in capital raised).

Interestingly, the top 10 of VC-backed companies and the universities their founders attended includes only one non-U.S.-based institution, Tel Aviv University.  We wonder how this list will look 20 years down the road with the ambitions of Chinese entrepreneurs.

Perhaps more interestingly is the lack of a European-based university in the top 10.  Given that the European Union is the largest common economic zone (the GDP of the combined European Union nations is about 20 percent higher than the United States).

Source: Pitchbook

Ranks 11 through 25

Shifting now to universities ranked 11th through the 25th.  Would you guess some European and China-based companies show up here?  Interestingly, the answer is no.  Of the 11th through 25th ranked universities, only one non-U.S. university shows up on the list – Technion – Israel Institute of Technology (Israel).

The 11th ranked university is Yale University – the fourth Ivy League school on the list thus far – with 504 entrepreneurs, 458 companies, and $11.44 billion in capital raised.  The remaining members of the top 25 includes Princeton, University of California at Los Angeles, Technion – Israel Institute of Technology, University of Wisconsin, Columbia University, Brown, University of Southern California, Carnegie Mellon University, Duke University, University of Waterloo, University of Washington, Brigham Young University, New York University, and Dartmouth College.

Source: Pitchbook

The Rest of the Top 50

The remaining members of the top 50 (ranks 26 through 50) are given below.  Lots of money being invested in bright-minded college graduates.

Source: Pitchbook

Conclusion

In an interesting review of the top universities for entrepreneurship, some interesting findings emerge.  Perhaps the most interesting finding is the dominance of U.S.-based universities in garnering capital from venture capital funds.  Of the top 25 universities, 23 of the 25 are U.S.-based.  Still good to be an American.