Sophie Burkholder and Peter Erin of Innovation Works discuss the investment in Pittsburgh technology companies. Photo by David Radin.

When thinking about Pittsburgh’s technology sector, Leon Hoffman, the Pittsburgh office managing partner for Ernst & Young, says “resilience comes to mind.” 

He made his comment against what he deems as “a challenging backdrop for tech startups” as Ernst & Young and Pittsburgh-based Innovation Works released their annual report on investments in Pittsburgh’s technology sector on March 23 at Alloy 26 on the North Side.

According to the report, Pittsburgh tech companies managed to attract almost $1.05 billion across 176 deals during 2022 amid an economic downturn and shrinking valuations. It was a strong end to the decade covered by the report, with total investments up from $894 million and venture capital investments up from $592 million to more than $716 million.

Each year Ernst & Young and Innovation Works look at the previous decade of investments in the region to understand the trends and inform investors and entrepreneurs alike so they can make good decisions. The methodology of using the entire previous decade also allows them to smooth out the curves so they can recognize which years have blips in the numbers.

During the decade ending in 2022, 300 firms invested in Pittsburgh companies, of which 74 were new investors here, including a combination of investors from outside the region, new funds in the region and newly formed investment companies. 

Most of the 74 are from outside the region, which Innovation Works President & CEO Ven Raju attributes to trends that have been accelerated, in part as a result of the pandemic.  

Ven Raju, president & CEO of Innovation Works. Photo courtesy of Innovation Works.

“East Coast and West Coast VCs have a greater proclivity now to look beyond their 50- or 100-mile radius,” Raju says, referring to the distance from their home markets in which venture capitalists traditionally invest. 

Investing in companies that are within drivable distances historically made it easier for investors to visit their investments to look after their money, but it’s a fading limitation since the pandemic shifted more activities in the tech sector to remote.

In keeping with the message that has been part of Pittsburgh’s tech growth for years, Raju and Hoffman dwell on Pittsburgh being a great place to start a business, having great talent and great universities. The message this year also adds that while the breadth of talent may not be as big as cities with larger populations, distributed workforces have helped local companies, and thus investors, leverage talent from around the country.

The drivers of growth include $11 billion of university research over the past decade, although Raju emphasizes that a majority of the total investment is not from that source.  The region has also attracted and grown satellite offices of global companies such as Alphabet (Google), Facebook and others.

Catherine Mott of BlueTree Allied Angels, right, moderates a panel discussion with Joe Hipsky of IRALOGIX (left) and Graham Rihn of RoadRunner Recycling (center) at the Investment Landscape Report event at Alloy 26 on the North Side. Photo by David Radin.

Raju also points to the formation of new funds, including Black Tech Nation and Magarac Venture Partners, additional raises by BlueTree Capital Group, as well as corporate funding initiatives that include BNY Mellon UpPrize and a new fund started by Dick’s Sporting Goods in 2022 to support sports technology which is not yet part of the report’s data.

One of the challenges to the region is that there are only a few local investors that lead investment rounds, a situation that Raju says can be rectified by funds getting larger. He adds that “the ecosystem warrants a $100 million, $200 million, $300 million fund that can lead.”  

In the meantime, drawing more investments from outside the region has attracted lead investors from elsewhere with whom local investors can join to support companies in Pittsburgh.

David RadinCEO of Confirmed

David Radin is CEO of Confirmed ( For decades, he has been leveraging technology and techniques to transform the way his audiences and clients succeed.