SAN ANTONIO — San Antonio has no shortage of self-image when it comes to technology, but until this month it had no shared measurement of it. The city’s first State of Innovation Report — produced by a consortium of Geekdom, Port San Antonio, Tech Bloc and VelocityTX with Greater:SATX as lead data partner — lays out a local innovation economy that is adding jobs faster than almost any major US metro while stubbornly failing to generate startups, venture capital and patents at comparable rates.

The jobs story is genuinely strong. Innovation-sector employment in the San Antonio metro reached 55,054 in 2025, up from 53,703 the prior year, and the report credits the metro with the second-fastest employment growth among large US metros at 2.5 percent — behind only Austin’s 3.1 percent and ahead of Charlotte and Dallas. The biotechnology, software, cybersecurity, defense and aerospace employers that anchor the region’s economy kept hiring through a year when national tech hiring cooled.

The warnings sit one layer down. Startup formation collapsed to 23 new companies in 2025 from 49 the year before. Venture investment fell 31 percent, patent grants dropped 24 percent, and early-stage funding — $127.5 million in 2024 — fell by 92 percent. On a per-capita basis, venture capital invested in San Antonio is down 77 percent. The report’s diagnosis, attributed to Geekdom CEO Charles Woodin, is blunt: the city lacks an ecosystem where founders building real companies and investors with capital find each other at the moment it matters. Entrepreneurs who do raise money face pressure to relocate to Austin or Silicon Valley, where their investors prefer to sit close to the asset.

The report also maps where the region’s research dollars actually land, and the concentration is striking. Of $2.55 billion in qualifying federal research and development contracts, the largest share has gone to Southwest Research Institute, followed by Port San Antonio at almost $224 million and the San Antonio International Airport at $88 million, with UT San Antonio near $35 million and the South Texas Medical Center at $16 million. That profile explains both the region’s strength in defense-adjacent engineering and its weakness in commercial startup activity: federal contracts reward established institutions, not new firms.

The consortium’s authors argue the city’s innovation model depends on physical proximity — test cells, lab benches, airspace — that a few institutions provide but the region needs more of. VelocityTX President Rene Dominguez called the findings an eye opener while insisting the city is not starting from scratch; the elements of a strong innovation economy are present, he said, and converting them into economic outcomes has been the problem.

Released the morning after a midterm election that reshuffled state government, the report lands at a moment when San Antonio’s delegation will hold more leverage over state economic-development policy in the 2027 legislative session. For a region long treated as Texas’ also-ran in technology, the baseline is the point: hard numbers now exist against which the next five years of startup formation, funding and patents will be judged.