CMU President on Pittsburgh's High-Tech Startup Growth
Pittsburgh's Rise as a Tech Hub
Recently, Pittsburgh experienced a surge of attention, briefly appearing as a potential focal point within the technology sector. This coincided with the initial public offering announcement from Duolingo, a company founded by a Carnegie Mellon University (CMU) graduate.
Simultaneously, Senators Bob Casey and Pat Toomey visited the City of Bridges, and Vice President Kamala Harris arrived to discuss infrastructure initiatives.
Robotics Alliance Announcement
Prior to TechCrunch’s City Spotlight event, the Pittsburgh Robotics Network unveiled a new collaborative effort. This alliance includes participation from local government officials and faculty members from area universities.
A press release detailed the composition of the alliance: “It unites prominent leaders from robotics firms, research institutions, and universities in the Pittsburgh region, encompassing Carnegie Mellon University (CMU), Argo AI, Aurora, the University of Pittsburgh, Kaarta, RE2 Robotics, Neya Systems, Carnegie Robotics, HEBI Robotics, Near Earth Autonomy, BirdBrain Technologies, Omnicell and Advanced Construction Robotics.”
The Richard King Mellon Foundation demonstrated its support for this milestone by awarding a $125,000 grant to the PRN, intended to facilitate its continued expansion.
From Rust Belt to Innovation Center
Our Spotlight event aimed to showcase the city’s ongoing transformation. Pittsburgh is often perceived as a resilient city still recovering from the industrial decline of the 1970s and 80s.
The departure of manufacturing and industrial jobs, which once underpinned the city’s economy, left a lasting impression. However, dedicated advocates are actively working to reshape Pittsburgh’s image, positioning it as a leader in robotics, artificial intelligence, autonomous systems, and other advanced technologies.
Carnegie Mellon University: A Cornerstone of Progress
Carnegie Mellon University has consistently served – and continues to serve – as the foundation for this evolution. Recognized globally as a top-tier research institution, CMU stands as the premier academic asset within the region’s diverse network of colleges and universities.
While the University of Pittsburgh significantly contributes to the city’s medical and scientific communities, it is CMU that establishes Pittsburgh’s prominence in the fields of robotics and self-driving vehicles.
The Swartz Center for Entrepreneurship
Speaking at our event, Farnam Jahanian highlighted the role of CMU’s Swartz Center in fostering the entrepreneurial aspirations of both students and faculty.
“The Swartz Center for Entrepreneurship at Carnegie Mellon provides a unique pathway through programming, education, engagement, collaboration, and opportunities for those interested in entrepreneurship. This includes programs like Innovation Scholars, a corporate startup lab, and dedicated spaces where students and faculty can launch their ventures, alongside a range of other resources,” explained Jahanian, who assumed the CMU presidency in 2018.
Established in 2015 with a $31 million donation from CMU alumnus and Accel Partners co-founder James R. Swartz, the Swartz Center built upon earlier initiatives such as the 2012 Carnegie Mellon Center and Project Olympus, founded in 2007.
Duolingo, DataSquid, and AbilLife are among the success stories originating from the Swartz Center and its predecessors.
Striving for National Recognition
Dave Mawhinney shared with TechCrunch his ambition, upon taking the role of the center’s executive director, “to elevate it to the level of Stanford, MIT, Berkeley, Harvard, and other leading entrepreneurial universities.”
While CMU already rivals these institutions in research excellence, Mawhinney acknowledges a historical challenge in retaining entrepreneurial ventures within the city.
The Importance of a Collaborative Ecosystem
“We continually learn and build upon existing strengths,” Jahanian stated. “It’s crucial to recognize that this isn’t solely about CMU’s efforts. The University of Pittsburgh and other regional universities also make substantial contributions to our ecosystem.”
A Decade and a Half of Growth
Mawhinney noted that CMU’s capacity to incubate and support tech startups reached a turning point approximately fifteen years ago, as major technology companies began to show increased interest in the school’s research in areas like AI and automation.
“The pivotal moment was Google’s establishment of a Pittsburgh office in 2006, now employing over 1,000 people,” he said. “Every major tech company – Amazon, Facebook, Apple – has embedded hundreds of engineers within our community, driving rapid growth. Artificial intelligence originated at Carnegie Mellon, sparking the robotics revolution. We are now a central hub for automated vehicle development, with Aurora, Argo, and Aptiv all having a presence here.”
The Capital Challenge
Successfully launching a company requires more than just skilled engineers. Prior to our event, I inquired with various stakeholders about the biggest obstacles to attracting and nurturing the city’s startup ecosystem.
The consistent response was a need for increased access to venture capital.
“We require more capital – angel funds, venture funds – to provide entrepreneurs with diverse local funding options,” Yvonne Campos of Next Act Fund LLC told TechCrunch. “There’s a particular need for increased funding for women-led businesses, as women typically raise about one-third less capital than their male counterparts. This isn’t due to the quality of the business idea or leadership, but rather a tendency to invest in individuals who resemble existing investors. Nationally, only 20%-25% of angel investors are women. We need greater female participation as investors.”
City and University Alignment
Pittsburgh’s mayor, Bill Peduto, who also participated in our event, echoed this sentiment.
“The primary challenge remains access to venture capital, particularly at this stage. We’ve successfully convinced investors from the coasts that companies don’t need to leave Pittsburgh to thrive. However, increased venture capital investment here to support early-stage companies through expansion would create a positive feedback loop and accelerate growth across the industry cluster,” he explained.
A Different Perspective on Funding
However, Jahanian offered a contrasting viewpoint. “I respectfully disagree,” he stated. “Funding is important, but exceptional ideas invariably attract funding. Throughout my career, I’ve observed that they secure funding at levels indicative of their potential for success.”
Beyond Funding: Essential Resources
CMU’s president identified another critical need. “Launching a company requires more than just innovative technologies or research concepts. You need expertise in marketing, product management, and business plan development. These are the types of resources we actively provide,” Jahanian said.
The Need for Specialized Talent
Bing Gordon, CPO at Kleiner Perkins, shared a similar perspective via email: “[Pittsburgh needs] to attract CFOs, product managers, and advertising sales professionals.” Historically, attracting this talent has been a challenge for the city.
CMU has not faced this issue with students, as location is less of a factor when choosing a research university. However, when it comes to post-graduation careers and establishing a family, quality of life becomes a paramount consideration.
Prioritizing Quality of Life
Jahanian stated that he has consistently advocated for green spaces and communal gathering places in his discussions with Peduto, and believes this should remain a priority for the city’s future mayor.
“The quality of life for citizens is paramount to the success of the startup and high-tech community in Pittsburgh,” Jahanian emphasized. “As a university president, I can attest that the vast majority of faculty we recruit prioritize living and enjoying the city. Beyond quality of life, it’s crucial to bridge the gap between those prospering in the new economy and those who might be left behind. This is a shared responsibility of the private and public sectors. I am optimistic about a continued strong partnership with our future mayor to catalyze economic growth and benefit all residents.”
