Pittsburgh Mayor on the city’s startup community and the difficulty of attracting venture capital – TechCrunch

This week, TechCrunch shines its spotlight on Pittsburgh, Pa. with interviews, profiles and an event featuring the outgoing mayor, CMU president and local startups.

The town of Rust Belt has spent much of the last decade working to shed the image that came about as a result of the deindustrialization of the 1970s and 80s. Thanks to world-class universities like Carnegie Melon and the At the University of Pittsburgh, the Steel City has evolved into a vibrant startup ecosystem and world-class environment for robotics, AI, autonomous driving, and other high-tech businesses.


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Ahead of tomorrow’s event, TechCrunch spoke to Bill Peduto, mayor of Pittsburgh since 2014, a role that has been overseeing much of this transformation. The mayor spoke of his efforts over the past half-dozen years, which will culminate in January when he leaves office.

Peduto will also be speaking at our City Spotlight event on Tuesday, June 29, 2021. He will join Karin Tsai, Director of Engineering at Duolingo, and Farnam Jahanian, President of Carnegie Mellon University. Register for the free event here.


TechCrunch: What are the biggest initiatives the city government is implementing to really help nurture the startup community?

Mayor Bill Peduto: We have been a partner for the past seven years, whether with the autonomous vehicle industry, the expansion of robotics or artificial intelligence, predictive analytics, we have engaged directly with the community of startups, got them involved in city government and also opened up and provided access to public rights of way in order to see these industries grow. In collaboration with our universities, we were able to recruit international companies in Pittsburgh: Bosch, Tata, Google, Facebook, Intel, Amazon. They have provided parallel advancements in the tech industry. Pittsburgh has become an innovation hub where people will come not only for jobs, but because they know there are opportunities here for career advancement in specialized fields.

Many of these companies have emerged from CMU, in sectors such as robotics, automation and self-driving cars. What is your perception of the diversity and diversity of the startup community. What is the breakdown of robotics and automation on one side and all the other tech categories on the other?

I would say that robotics and autonomous industries have positioned themselves much more visible on the world stage. But other industries – especially within the startup industry – are competitive for a part of Pittsburgh’s economy. Obviously, the partnership we created with Uber, Aurora, and Argo AI – they all gained attention as Pittsburgh became the first city in the world to have autonomous ridesharing. But the point is, CMU had already been testing its vehicles on our streets for a decade ago. We have become a city that was one of the first to be able to develop this. The competitive advantage we have here is that we don’t have to attract talent here to develop industries. We produce the talent.

It seems there has always been a problem keeping talent in Pittsburgh. People often move themselves or their businesses to New York or Silicon Valley. Has it changed? What initiatives need to be taken to ensure that people not only come to Pittsburgh, but stay in Pittsburgh?

It is the responsibility of the local government to create an environment where people want to live. Quality of life is important and is a key indicator in building a 21st century urban economy. All of the different amenities that we add to municipal government are important. People want to live in a place that offers them opportunities that don’t involve being at home or being at work. They want to have a place that has open spaces and free and abundant areas that they can enjoy. Young people want to be surrounded by other young people. For decades, Pittsburgh has lacked all three. It was a direct consequence of deindustrialization and divestment. We have worked very hard as a city administration to create all three and support local businesses, be it restaurants, stages or theaters, as an essential part of not only the arts and culture of the city, but also as an essential part of our economic development strategy.

I recently spoke to startups around Detroit and it was kind of a mixed bag when it comes to the legacy of having had the auto industry based in the city. In 2021, what are the benefits of being a legacy industrial city when it comes to building a startup ecosystem.

It depends on the company itself, not just the industry. There are companies that have been around for over 100 years that are among the most forward-thinking in our city. They diversified their portfolios and recognized the direction the world is going and they decided to become a competitive part of it. Other companies rely more on their success in the past as a model for their future development. When you look at cities like Pittsburgh and Detroit, you understand that their industrial past is something they are very proud of and build on.

Does it make sense when talking to fossil fuel companies that they see the writing on the wall when it comes to pivoting to something greener?

Again, it is not defined by the industry. It is defined by the company and, in most cases, the CEO. In many cases in Pittsburgh, absolutely, yes. From inception to power transfer, long-established companies are looking to find a way to put Pittsburgh on the map when it comes to switching to green hydrogen. The leaders in this field are not just universities, but long established companies in gas and, in some cases, in oil.

What is your idea of ​​the long-term impact of Covid-19 on the decentralization of some of these tech communities.

You used the exact term. I believe that the post-Covid will be a decentralization of the coasts towards the cities which knew how to create an environment where they would like to establish themselves. When we look at the competition, we look at Charlotte, Austin, Nashville. We confront these cities and what they can offer the startup industry. We’re not as concerned about New Yorks and San Francisco – or even Boston. What we are seeing is that we can be very competitive against any other field whose research and development is fueled by the education and medical industries.

What’s the biggest obstacle when it comes to being an entrepreneur in Pittsburgh? And what are you doing to help solve this problem?

I think the biggest barrier is still access to venture capital, especially at this stage. I think we’ve been successful in convincing investors on the coast that companies don’t have to leave Pittsburgh to be very successful and see their investment pay off. However, I think if we had more venture capital coming in here to help start-ups enter this critical next stage of expansion, it would grow and excel significantly in growing the whole cluster. industrial.

Concretely, what is the city doing to attract attention [and money] venture capitalists?

It is more a partnership with established institutions like universities and hospitals and our local VC community that have been at the forefront. The city provides critical support. I should also mention that our corporate and philanthropic communities are also key partners. By working together, we created the Pittsburgh Innovation District. This was a direct result of the Brookings report released a few years ago. It is a structural partnership between the city and the department, the philanthropic community, the universities and the UPMC. It is created not only to recruit startups, but also to recruit funding and be partners in the funding of our startup community.

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