Will Sanderson grew up in northern New Jersey, or, as he puts it, “Philly adjacent.” He moved to the Greater Philadelphia region when his wife did a residency and medical fellowship at the University of Pennsylvania (Penn), and he was a Senior Product Manager with MachineQ, a Comcast-owned technology company focused on the Internet of Things (IoT).
Jeff Stade earned a master’s degree in urban spatial analytics at Penn and was a senior product manager at Tidelift, an open-source software company.
They were friends of friends with something in common. They wanted to start their own company. So, there they were in 2018, meeting in historic Suburban Station in Center City, Philadelphia, and hatching plans for what would become Jawnt, a bold attempt to reinvent the world of mass transit by creating a unified platform for employers to offer transit benefits to employees.
Today, Jawnt partners with the Southeastern Pennsylvania Transportation Authority (SEPTA) and others to serve a wide variety of corporate customers, hoping to incentivize public transit. Chamber members Sanderson, Co-Founder, and Stade, CEO and Co-Founder, have come to embody a new generation of entrepreneurs in the region.
“Philadelphia is an interesting place,” Sanderson said. “New York can be expensive and difficult to live in. The lower cost of living here helps you take bigger risks. And being smaller than New York or San Francisco, it’s a tighter community. People are rooting for each other and supporting however they can.”
For many years, Greater Philadelphia took a backseat to metro areas, such as New York, Washington D.C., and San Francisco, when it came to startup companies. That is changing, driven by the presence of so many world-class universities and their graduates, the growth of the cell and gene therapy industry, a more affordable cost of living, Gov. Josh Shapiro’s business-friendly policies, and even the continued fallout of the COVID-19 pandemic.
“COVID showed that you could build your business anywhere,” said Scott Nissenbaum, President and CEO, Ben Franklin Technology Partners of Southeastern Pennsylvania. This state-backed firm provides capital and other services to technology startups. “Do you need to be in downtown Manhattan? The fundamental answer is you don’t, so we’ve seen an influx from New York and Washington D.C. of top talent to go along with the top talent that was already here.”
Greater Philadelphia on the Rise
A series of recent reports show the emerging strength of Greater Philadelphia’s startup community, even as the overall market for venture capital funding and IPOs is at a cyclical low.
- In the past two years, Philadelphia has ranked 27th in the world on the list of best ecosystems for growing companies. That’s up 16 spots in Startup Genome’s Global Startup Ecosystem Report in three years.
- Entrepreneurs in Greater Philadelphia are the fourth youngest among the top 50 metropolitan markets at 34 to 44 years, according to a recent Lending Tree study.
- Funding for startups in Greater Philadelphia rose by nearly 53% to $750 million in the third quarter, compared with the previous quarter, according to Pitchbook’s Venture Monitor report. While that’s still 11% below the same period a year ago, the growth outpaced the national figure, which fell to its lowest amount in almost four years.
- University of Pennsylvania alums have raised nearly $90 billion over the past decade, ranking fifth among undergraduates and sixth among graduate school founders.
“Short-term, we’re in a drought from a venture capital funding standpoint, but these things are always cyclical,” Nissenbaum said. “Longer term, we’re in a boom in Philadelphia.”
This trend is helped by the Shapiro Administration, which has prioritized business development in the Commonwealth. Shapiro’s first order as Governor in January 2023 was the establishment of the Pennsylvania Office of Transformation and Opportunity and the Economic Development Strategy Group under the direction of entrepreneur and former Tinuiti CEO Ben Kirshner.
“Gov. Shapiro and his team are building the first statewide economic agenda in 20 years to grow and strengthen Pennsylvania,” Nissenbaum said. “They are aggressive in reaching out and building and growing.”
‘Stay There; Keep Growing’
This mentality is bolstering strengths that were already apparent in the region.
“Do we have talent? With the universities and our talent pool, we have the talent, and not just the talent for existing industries; we have some of the greatest universities within an hour of Philadelphia pumping out talent for industries that don’t even exist,” Nissenbaum said.
Greater Philadelphia has transportation hubs that allow people to travel to many places in the world, and the region is less expensive while providing culture and sports. As a result, Nissenbaum said, “Investors are getting more comfortable with the idea of saying ‘Your capital is more efficient in Philadelphia. If you do more with what we gave you, that means we get more back.’ They’re saying, ‘Stay there. Keep growing.’”
The region is also committed to extending these opportunities to diverse communities. Ventures such as Plain Sight Capital are working to help Black and brown communities build multigenerational wealth using the region’s technology ecosystem.
“There is a real concerted effort that many stakeholders are getting behind to make sure that this is a place where Black and brown entrepreneurs can get the resources they need to get ahead,” said Jason Bannon, Vice President of Marketing and Communications, Ben Franklin Technology Partners.
“In the past, Greater Philadelphia’s startup community was often fueled by happenstance,” Bannon said. “Today, it’s becoming more purposeful.”
“Budding entrepreneurs might have ended up in Greater Philadelphia because their spouse took a job at Penn or another institution, and they needed something to do,” he said. “Now it’s more like we’ve made a decision that Philadelphia will be where the best opportunity for my whole family will be. What we’re finding is more people are eager to make this place their own.”
Jawnt’s Sanderson would agree. After all, he was one of those people who came here because of a spouse. Now he’s building a company here.
“It’s a rising tide,” he says. “The more people who are here, the better everything gets. And we can support each other.”
For more stories about the companies, developments, and entrepreneurs that are driving the economy in the Greater Philadelphia region or for more information about locating or expanding here, visit the Select Greater Philadelphia website.