San Francisco is still the best city in the world for innovation - here are the 6 cities that threaten to usurp its position of power
10. Melbourne, the second biggest city in Australia, fell four spots in the ranking this year. It's considered the best city for personal well-being, and has the largest international student population.
9. Down one spot in the ranking, Houston has a healthy economy. It has the highest GDP per capita of any city considered for this list.
8. Boston slid three spots in the ranking, but its top universities, including Harvard and MIT, continue to score big points for innovation.
7. Munich held steady at the No. 7 spot, after showing rapid increases in business activity over the last year.
6. Up a whopping 10 spots in the ranking, Amsterdam placed highly because of its steadfast support for freedom of expression.
5. Singapore, an island city-state in Southeast Asia, rose six places in the ranking. It turned in strong performances across economics, policies, culture, and infrastructure investment.
4. Falling one spot in the ranking, Paris remains a powerhouse of innovation in part because it hosts more big-ticket tech conferences than any other city.
3. London is arguably the world's real financial center. It climbed one spot in the ranking and leads the world in private investments.
2. New York was ranked as the most influential city today, but it's considered only the second most important city of the future.
1. Driven by high-growth companies in tech, San Francisco continues to excel in innovation. It held on to its top spot.
According to AT Kearney, San Francisco is the world's premiere hub for innovation and entrepreneurship. The Bay Area is home to a number of high-growth companies, including Apple, Facebook, Google, Uber, and Salesforce, and the region filed more patents per person (34,324 international patents between 2011 and 2015, with Google accounting for 6.5% of all applications) than any other city ranked by AT Kearney.
Venture capital is the lifeblood of business in San Francisco. Between 35% and 40% of all venture funding in the US flows into the Bay Area every year, according to a 2012 study by the Bay Area Council Economic Institute and Booz & Company. As a result, entrepreneurs build companies there, bringing highly-educated professionals to the area in droves.
But a concentration of wealth and power has worsened a dire housing market in the Bay Area, and not everyone can afford to stay. A shortage of housing coupled with high demand, especially from tech workers who can afford to bid up prices, has made it impossible for some to buy a home in the Bay Area on a middle-class paycheck.
The median price of a home in San Francisco is $1.5 million, and a person needs an annual income of at least $303,000 to afford the 20% down payment on a home that expensive.
San Francisco may be the best known city for innovation, but it's not the only urban area inspiring and financing entrepreneurs. For the full list of innovative cities and an explanation of the ranking's methodology, head over to AT Kearney's report.
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