While the Start-Up Paradox won’t pass into the business history books just yet, a new and very exciting chapter in that history is being written right now.

The Economist recently ran an article crowing that London has now qualified as the fourth-largest city in attracting start-up capital, according to the annual Dealroom.com survey.

The Economist wrote, “In 2025 its start-ups raised $17.7bn, behind only the Bay Area, New York and Los Angeles,” concluding “London is one of the best places in the world to start a company,” certainly better than Berlin, Tokyo, or Paris.

To which we must answer, we’re not impressed. That’s because The Economist is missing the real story: that the three top start-up capital magnets are all U.S. cities: San Francisco, Los Angeles, and New York City. In fact, San Francisco comes in at $157 billion, more than the rest combined, while London just barely edges out Israel ($15.6 billion).

Furthermore, seven of the top eleven are American cities: in addition to NYC, LA, and SF, they are Boston, Austin, Seattle, and Denver. As for China, it drags along at number 9 in the Dealroom survey, barely edging out Bangalore.

All of which suggests the future of innovation is securely in American hands for a long time to come.

But this prompts another question about this list’s top seven cities, which we’re going to dub the Start-up Mag 7. Why are almost all of them blue, even deep blue cities? After all, these are the same cities that tend to be resolutely anti-business, as well as redolent with high crime, high taxes, and high-cost housing, even, in the case of Seattle, active volcanoes of Antifa radicalism. Yet these same locations continue to draw the best of our entrepreneurs, risk-takers, and innovators, and their benefactors, and the money that chases after them. Why?

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