Bloomberg Associates · Economic Development · September 2026

Startup Support in the Age of Agentic AI

A practical guide for cities. What a city can do so that its residents and businesses benefit from the way AI is changing how companies are started, built, funded and located.

Three numbers frame the problem

524kUS business applications a month in 2026, up 79% on 2019. Most of them are one-person businesses, which is not the population the standard startup playbook was built for.Census

43%of all venture capital worldwide in the first half of 2026 went to two companies, OpenAI and Anthropic. No city can compete with that, so what a city does control is customers and rules.Crunchbase

6 mofor 10% of businesses started in 2025 to pay for an AI service; the 2019 cohort took 77 months. New founders need no help adopting AI. The firms already trading do.JPMorganChase Institute

Two kinds of businesses

Venture-scale technology startups

Founders who raise outside capital and aim for fast growth. Few and concentrated: 3,500 AI venture deals worldwide in the first half of 2026 (PitchBook), 52% of US pre-seed capital in California (Carta).

AI-enabled small firms and solo founders

Businesses one or two people can run. Many and dispersed: about 524,000 US business applications a month in 2026, fewer than three in ten expected to hire (Census).

The two groups are moving in opposite directions. Venture capital is concentrating while the number of small new businesses is rising, which means a city's options differ for each.

Part 1

Seven trends

One chart each, and the problem each one creates for a city.

Open →

Part 2

Ten actions

Each tackles one problem. Examples, and where a big or small city starts.

Open →

Part 3

Readings

Every dataset, paper, evaluation and talk behind the numbers.

Open →

The before and after line is November 2022The public release of ChatGPT. Every study that measures a change in startup formation uses that date. Agentic tools, which carry out multi-step work rather than answer a prompt, arrived on top of it from 2024.

AI-native startupA company with AI at the core of its product, market or business model, which would not exist without AI (Startup Genome).

Big city, small cityBig: already has a venture ecosystem, in PitchBook's 2026 rankings or Brookings' top two AI-readiness tiers, or is a national capital of venture activity such as London, Paris, Berlin, São Paulo or Mexico City. Small: everywhere else.

Part 1 · Trends

Seven things that changed

Each trend ends in a problem for a city. Open one for its chart and evidence; hover any bar for the number.

What the seven trends add up to

Starting a business got cheaper and more commonMost new businesses are one person, they use AI from the start, and few of them will hire.Problems 1 · 2 · 7

Venture capital concentratedIn a few companies, a few funds and one metro area, and the AI capital inside it concentrated further still.Problems 3 · 4 · 5

What is left for a city to act on is physicalThe hardware, robotics and defence companies that still hire and still need space, power and permits, and the firms already trading that are falling behind on AI.Problems 6 · 7

All three come from the same cause, which is why this guide is organised around AI rather than by sector. See the ten actions →

Part 2 · Playbook

Ten actions

Each action tackles one of the seven problems.

Every initiative below was delivered and tested by other institutions.

Where to start: big city, small city

Big city: has a venture ecosystem already, in PitchBook's 2026 rankings or Brookings' top two AI-readiness tiers (San Francisco and San José, then 28 star hubs including New York, Boston, Seattle, Austin, Chicago and Washington), or a national capital of venture activity such as London, Paris, Berlin, São Paulo or Mexico City. Small city: everywhere else.

The problems are the same everywhere. What changes is which action does the work.

Part 3 · Readings

Everything behind the numbers

Sources marked cited are quoted directly in Parts 1 and 2, and additional readings.