PrivCo report: Silicon Valley remains far ahead of other tech centers

There are many who would delight in news of Silicon Valley's decline, but their schadenfreude festivities will have to be postponed yet again.
Written by Tom Foremski, Contributor

Silicon Valley reported 226 private company acquisitions in 2012, well ahead of New York, with 100 deals, and leagues ahead of any other US tech hub, reported PrivCo, which tracks such deals.

Facebook HQ
1 Hacker Way, Facebook HQ: The company acquired 16 startups in 2012.
Image: Tom Foremski

The Silicon Valley region, including the wider San Francisco Bay Area, recorded 226 private company sales in 2012, and next was New York, with a surprising 100 deals, which ousted Boston and its 62 deals. LA had 55, and Seattle's 43 deals narrowly beat Austin's 40 and Washington DC's 39.

Silicon Valley companies dominated as the top acquirers in 2012, with Facebook tied with Google at 16 deals. Twitter and Cisco each bought 10 startups, Oracle made 9 deals, and Autodesk made 6. Chicago-based Groupon bought 12 companies, Microsoft 8, Dell 7, and Colorado's Zayo bought 6 startups, including the most valuable deal of the year — acquiring New York's AboveNet for $2.2 billion.

Boston's Lightower sold for $2 billion to Berkshire Partners, making it the second largest deal; third was Silicon Valley-based Taleo, which sold to Oracle for $1.9 billion.

Here are more info and charts.

Foremski's take

Silicon Valley's critics are endlessly hopeful that it will start to decline as other tech hubs in the US and around the world ramp up, but their longed-for schadenfreude must again be postponed, because the region is as strong as ever.

Just because it's possible to innovate nearly anywhere around the world doesn't mean Silicon Valley has to lose out. It can be a win-win for every region because of the best practices and lessons that have been painfully pioneered by Silicon Valley firms.

Silicon Valley also shows that even though tech hubs around the world can mimic its model — by building business parks around top universities — the culture of Silicon Valley cannot be copied and it doesn't travel well, which is why many startups that were founded elsewhere have established Silicon Valley offices. And many more will do the same.

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