Writer: Eleana Teran
2 min read March 2023 – A recently published annual assessment by EY and Innovation Works on Pittsburgh’s technology investment environment reveals the city’s tech sector held up well in 2022 despite adverse economic conditions.
According to the report, the city’s tech scene remained resilient over the last year, raising $1.05 billion across 176 deals during a time of rising inflation among other economic headwinds. Although the city’s tech ecosystem saw less than a third of the funds raised in 2021, the report highlighted that early-stage and angel funding increased in the region. Institutional investors contributed over $716.8 million, while corporations added $248.3 million and angel, pre-seed, or seed finance put up $64.2 million, resulting in a 55% increase in deals since 2013.
Furthermore, the report shows that the city’s tech economy has drawn investment into a growing number of local businesses. Pittsburgh has maintained a stable level of deal activity, even though it has not yet achieved its peak of 187 investment rounds in 2017. Overall, for investors seeking high-potential prospects, Pittsburgh’s technology sector continues to be promising due to its robust activity, technical prowess and talent.
The city’s strong capabilities and the $11 billion in university research funding over the past 10 years have drawn major corporations like Alphabet, Facebook and Bayer, who have opened satellite offices in the region. As a result, the Pittsburgh innovation ecosystem has generated more than $23 billion in exit profits over the past decade, making it a desirable location for businesses, talent and investors from around the world.
Additionally, the research indicates that investments in software have soared by 621% over the past decade, while those in life sciences have increased by 193%, demonstrating their potential for growth and making it the first time since 2017 that Pittsburgh’s hardware and robotics sector has received less investment than the life sciences and software industries. This expansion shows that the city’s tech sector can continue to develop even in a challenging year for hardware and robotics.
“Any city, county or region looking to expand and diversify its technology workforce must look at its existing strengths and expand on them. The Pittsburgh region was able to grow robotics much faster, because of CMU, early companies, and a supportive ecosystem,” Pittsburgh Robotics Network Executive Director Joel Reed recently told Forbes. In January 2023, Innovation Works, Pittsburgh Robotics Network and other regional partners launched new accelerator programs, called Robotics Factory, to support the creation and scaling of robotics startups. The programs’ funding is part of the $63 million Build Back Better Regional Challenge grant.
As the tech and robotics industry in Pittsburgh continues to grow, local businesses will need to equip their staff with applicable skills. Penn State New Kensington Chancellor Kevin Snider emphasized to Invest: that recent grants have helped to aid in workforce development and the incorporation of digital age technology into the curriculum.
“We are strengthening what we hope will be a replicable model for other small Rust Belt towns so that communities can put together similar components to help drive economic and workforce development, sustainability, as well as revitalization,” said Snider. With the assistance of the grants, the ARM Institute will be able to expand its robotics training programs throughout the area. These activities will heavily include The Digital Foundry, the innovation hub at Penn State New Kensington.
Considering the rapid advances in technology, it is critical for communities to be equipped with the tools to succeed in a digital economy. As Snider stated, “we want to provide people and communities with the skills needed to survive and thrive in the digital age.”
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