![10 most well-funded startup neighborhoods in LA [map]](https://cdn.builtin.com/cdn-cgi/image/f=auto,fit=cover,w=320,h=200,q=80/https://www.builtinla.com/sites/www.builtinla.com/files/screen_shot_2015-10-03_at_5.30.32_pm.png "10 most well-funded startup neighborhoods in LA [map]")
[ibimage==31513==Original==http://www.builtinla.com/blog/los-angeles-startups-raised-over-1b-2013==self==ibimage_align-left]The Internet’s ability to flatten national borders, shorten distances and hyperlink individuals would seem to make the physical location of a business completely irrelevant. Yet tech, the industry that appears least tethered to the ground, tends to cluster around specific locations.
Within the LA tech community this is no exception. By mapping Built In LA's 2013 digital funding startup data across LA zip codes, it's clear that a huge majority of funded businesses in LA reside on the Westside.
Intuitively, this is not surprising because Santa Monica and Venice-based companies are frequently in the headlines. However, the degree to which companies based in these areas receive funding shows a tech ecosystem thriving mostly on the Westside. In total, companies headquartered within Westside zip codes received $741 million of funding out of approximately $1.1 billion invested in greater LA in 2013.
Several notable companies within Santa Monica that raised funding in 2013 include TrueCar at $30 million, Science at $30 million, The Honest Company at $25 million, Demand Media at $19 million, Brighter at $15 million, DogVacay at $15 million and Whisper at $15 million.
SnapChat, which raised $110 million between B and C rounds, took the vast majority of deal flow into Venice, but StyleSaint also raised $4.3 million, Viddy raised $2.9 million and Epoxy raised $2.9 million.
When you remove SnapChat’s funding from Venice, it becomes apparent that Santa Monica is far-and-away the most well-funded ecosystem in LA, raising approximately $307 million in 2013.
And though, the top 10 best-funded zip codes represented the Westside well, there were also a few unheralded neighborhoods worth noting. El Segundo came in as 2013’s fourth best-funded area and not by chance. The area plays host to JustFab, an online fashion retailer that raised $55 million in 2013. Additionally, Nativo an up-and-coming programmatic native advertising platform raised $3.5 million. El Segundo also is headquarters for slightly more mature tech companies including Internet Brands and Fuhu, a tablet manufacturer for children.
Hollywood also did well in 2013 with around $59 million in funding raised. ZestCash led the neighborhood with $20 million, followed by ScoreBig with $10 million raised.
Why are there so many funded startups on the Westside?
To be clear, establishing a business within one of these top zip codes does not ensure success. Profitability is still the bottom line for startups. But, it is worth considering why so many startups choose the Westside and what is to be gained by clustering near each other.
Though the Internet has greatly expanded the volume and quality of information available to entrepreneurs, many of the old ways of exchanging information and doing business remain the same. Not everything an entrepreneur wants to know can be found in a book, a website or within a software program, so they go searching for this information among their peers by meeting for coffee, at startup events or within a co-working space.
Proximity is also important as a means to find business partners and employees who carry this best practice knowledge. Or more plainly, proximity is important for networking. This tribal knowledge, the informal tips, potential business partnerships and culture for which entrepreneurs hunger, is what drives tech clusters.
And with numerous established accelerators, incubators and co-working spaces, and a history of successful startups the Westside is primed to grow and perpetuate as a tech-hub.
Top 10 zip codes:
Rank
Neighborhood
Zip Code
Funding
1
Santa Monica
90401
$150,594,000
2
Venice
90291
$134,885,000
3
Santa Monica
90405
$86,468,855
4
Santa Monica
90404
$64,617,000
5
El Segundo
90245
$60,000,000
6
Hollywood
90028
$59,350,000
7
West Los Angeles
90025
$43,000,000
8
Culver City
90232
$30,300,000
9
Torrance
90501
$29,300,000
10
Downtown Los Angeles
90017
$28,420,000
Total
$686,934,855
The future of non-Westside LA tech clusters
Will cutting edge tech companies ever cluster in new hubs, in new corners of the city?
The answer cannot be known for sure, but if history serves as a guide, the tech culture currently thriving on the Westside will likely spread.
Silicon Valley for instance has come to represent more than just Santa Clara Valley for which it was originally named. In recent years, the city of San Francisco has become a hot spot for startups including Dropbox, Salesforce.com and Twitter.
LA has the potential for such a shift, too. As rent prices continue to rise in Santa Monica and Venice, entrepreneurs may look eastward for office space. Westwood, Downtown, Hollywood, Culver City and Pasadena all are areas of LA County with relatively cheaper rents, desirable surroundings and access to highly educated workforces.
With several world leading knowledge centers nearby, including Caltech and the NASA Propulsion laboratory, Pasadena in particular seems ready for a digital tech boom. Caltech has produced 31 Nobel Prize Winners over its history and the NASA Propulsion Laboratory is staffed with the rocket scientists that landed the last rover on Mars. Such a concentration of knowledge would seem likely to have an impact on the digital startups in the Pasadena area. It is entirely possible that Pasadena and its knowledge base could serve just as Palo Alto and Stanford did for early Silicon Valley.
