Tech Center: Pittsburgh Takes On Tech

Pittsburgh has contributed a plethora of everyday items and services that many may take for granted. The city’s contributions to the country in addition to being the base of America’s steel industry, the city was also the birthplace of the beloved Mr. Rogers, McDonald’s Big Mac and the very first drive-in gas station. It’s also the birthplace of legendary American artist Andy Warhol.

As one of the most integral parts of America’s history, Pittsburgh is well known throughout the country. What may not be well known is how Pittsburgh is making its way to be one of the most influential tech centers. Over the past few years, Carnegie Mellon University’s School of Computer Science has been churning out young tech talent, and big companies have taken notice with the likes of Apple, Facebook and Google setting up offices in the city.

Before we jump into the post, here are a few quick facts about Pittsburgh and its tech scene:

Pittsburgh had a population of 303,625 in 2016, making it the 63rd largest city in the U.S.

GDP of Pittsburgh: $130.2 million in 2016

Median household income: $40,715 in 2015

There are more than 662 startups and tech companies

There have been 68 startups launched since the beginning of 2017

Total funding for the past 12 months: $149,867,980

In this week’s Tech Center tracker, Tom Galluzzo, CEO of IAM Robotics, a robot automation software company, told PYMNTS that Pittsburgh is much more than its steel-town reputation, sharing how the city has grown to a tech titan.

“Pittsburgh is an attractive location for both entrepreneurs and investors because of the startup community and the number of talented people educated in this region,” Galluzzo said. “The most surprising thing about operating a business here is how much talent there is in Pittsburgh, especially in robotics. It is not the industrial steel town people think it is any more.”

With many big-name companies coming into the area and universities directly feeding into the industry, Pittsburgh is helping to differentiate itself from its former reputation as a pure manufacturing town. “What makes Pittsburgh different is its prime university talent, the local corporations with an interest in technology and those local corporations that are developing technology,” Galluzzo added.

A close-knit tie to the Pittsburgh community, alongside the emerging tech talent, is something that’s not only helped IAM Robotics grow its team but also the tech industry in the area. In the last two years alone, Pittsburgh’s tech employment rate has seen a 12 percent bump.

“IAM Robotics started out with seed funding from Innovation Works. From there, Innovation Works connected us to partners in the Pittsburgh area, and focused us on providing value through our robot,” Galluzzo said. “We met some amazing people and got some great support from Carnegie Mellon University. They treat us like family. Out of Innovation Works, we put a lot of hard work in and used the connections to help us create a minimum viable product. Now, we still use our ties to the tech community and grow the company, the product and ourselves.”

Pittsburgh has certainly evolved over the last few years, and although we’ve seen those large companies move into the area, it’s not without its fair share of challenges. One of the major challenges facing the Pittsburgh tech community, as highlighted by Galluzzo in our conversation, is that Series A funding often does not come directly from within the city itself. Most companies looking for this particular round of investments look to places outside of the city to secure those funds.

As the area continues to grow its tech arena, what may be a contributing factor to this is the move into robotics and automation for many companies looking to expedite services for today’s digital-savvy consumer.

“Robotics is a major sector thriving in Pittsburgh,” Galluzzo said. “The number of robotics companies, the number of robotics students and investment in robotics have all increased. The evolution of Pittsburgh into robotics began with its unique location in the Midwest. We see this location as a premier space for the perpetual collaboration of software and hardware for years to come.”