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The most innovative cities in the world in 2022

4 October 2022 Data Insights
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Innovation can be defined in various ways. Oxford Languages defines it as: ‘a new method, idea, product, etc.’ However, if you ask any other expert, they may have a different idea of what innovation is.

In a business sense, Nick Skillicorn, CEO of Improvides Innovation Consulting, summarises innovation perfectly as ‘Turning an idea into a solution that adds value from a customer’s perspective’. Innovation in business is necessary to be able to adapt, overcome barriers and to foster growth. It’s also key in reducing the risk of stagnation which can be detrimental to businesses big and small.

Our last Innovative Cities report highlighted the Global and UK cities which ranked above the rest for innovation. This year, aside from continuing to recover from the impacts of the COVID-19 pandemic, increasing costs have created a whole new set of challenges that have required businesses across the globe to innovate.

At Paymentsense, we want to better understand which cities are inspiring innovation by comparing them to last year’s data to see what has changed over the past 12 months.

Measuring Innovation

For the global index, we analysed the following data points to compare previous years data:

  • Number of patent applications registered on Google
  • Number of new business registrations in 2021
  • Number of universities and their RUR World University ranking (while education does not by definition imply innovation, universities have long been establishments that often have the time and resources to innovate in various areas).
  • Average monthly search volumes and search trends for 'how to start a business'
  • Number of businesses listed on global start-up crowdfunding platform, Kickstarter, and their average value

By utilising the following data points, we were able to create an index showing the globe's most innovative cities, and to compare the data year-on-year based on the 2021 report.

The most innovative cities in the world 2022

USA city, Washington D.C, is the most innovative city in the world

The USA is notoriously known for being a world leader in technology and business innovation. So it is no surprise that this year, the capital, Washington D.C has moved into first place, up from second.

There have been 98,190 new business registrations in Washington D.C. The city saw a boom in the number of Kickstarter ideas, as there are currently 386,227 fresh ideas and creations, this is a +9102% increase in comparison to the previous year’s data. Monthly searches for ‘how to start a business’ total over 165,000, indicating that entrepreneurship spirit is high in the city as inhabitants set out to become innovators in their own fields.

Germany’s capital, Berlin, currently has 4,854,951 patent applications

Germany is well known for its innovation in the automotive industry, having developed both driverless and electric vehicles. In fact, Germany is behind some of the most popular and most desired cars in the world, including Mercedes-Benz, Volkswagen and Audi.

The country’s capital, Berlin, ranks as the second most innovative city in the word. Aside from the 4,854,951 Google patent applications registered here, there has also been a 125% increase in search trends for ‘how to start a business’, showing the drive for entrepreneurship in the city.

France drops to third place in the innovative cities index

Last year, France ranked as the most innovative city in the world, steaming ahead of others ranking in the index. This year, the country known for its innovation in various fields such as technology and medicine ranks in third place.

However, the need for innovation is still strong in France, as there were 218,054 new business registrations and 1,008,892 Google patent applications, as budding entrepreneurs take their first steps into innovation and starting their own business.

Canberra, Australia had 235,654 new business registrations

Canberra, Australia ranks in the top five again for innovation. As noted in last year’s report, Australian innovators have contributed profoundly to medicine in the past. Although the city has fallen to fourth place, down from third, innovation is still continuing to happen in the city. Canberra has seen 236,447 new business applications, up from 235,654, a substantial increase on the previous year.

Beijing, China is the fifth most innovative city in the world

The Chinese city previously did not rank in the top five cities, instead just making the top 10. However, in the past year the city has seen 232,064 new business registrations, a 180% increase year on year.

The UK has the highest number of new business registrations in the top 50

London ranks in sixth place, with over 774,854 new business registrations, the highest in the index. Previously, ranking in 20th place, the UK now sits comfortably in sixth place.

The top 20 most innovative cities in the UK 2022

Focusing on the innovative cities across the UK, we analysed the following data points to find out which UK city is the most innovative in 2022.

  • Number of startups per 10,000 people
  • Number of patent records per 10,000 people
  • Number of kickstarters
  • Number of registered businesses in 2021
  • Average monthly online searches and trends for ‘how to start a business’ over 12 months

London is the UK’s most innovative city in the UK for the second year running

London ranks as the most innovative city in the UK for the second year running. Search trends for ‘how to start a business’ are up by 125%. As a result of this, there has been a 19.30% change in the number of startup businesses from 2020 to 2021.

Manchester moves up two places in the Innovative Cities ranking to second place

Manchester was the first industrialised city in the world and home to the first railway line in 1830. Now the city ranks second in the Innovative Cities ranking, climbing up the index from fourth place. Over the last 12 months there have been 1,649 Kickstarters registered in the city, 276 more registations than the previous year.

Leeds ranks as the third most innovative city in the United Kingdom

Our 2021 report saw the Yorkshire city of Leeds ranking in fifth place, however, after a year of increased business activity and innovation the city now ranks in the top three in our 2022 index. Leeds has a great track record of innovation and discoveries. In 1915, William Henry Bragg and William Lawrence Bragg received a Nobel Peace Prize for their discovery of the structure of crystals, which later led the way for future scientists to discover the structure of our DNA.

Bristol falls down two spots to the fourth most innovative city in the UK

Bristol previously ranked as the second most innovative city in the UK. However, this year's rankings show the ‘Green Capital’ sitting as the fourth most innovative city. Although, this positioning is still positive for the city - from 2020 to 2021 Bristol saw a 8.6% increase in the number of registered businesses and there are 40 patent records per 10,000 people, showing the increased number of fresh and innovative ideas spurring among the population.

There were 52 new startup businesses per 10,000 people in Birmingham in 2022

Our previous report revealed that Birmingham did not rank in the UK’s top 20 most innovative cities. However, after a year of returning back to normality post-COVID, the city known for its manufacturing roots and its heritage in music and food, now ranks as the fifth most innovative city in the UK. The average monthly search volume for ‘how to start a business’ in Birmingham is 720, proving the increased sense of entrepreneurship in the city. There is no wonder Birmingham now ranks in the top five!

How to utilise the funding available for your small business

With almost 6 million small businesses registered in the UK[1], entrepreneurs make a strong proportion of the UK business landscape. Although innovation is thriving, the cost of living crisis is making being an owner of a small business more difficult than ever. However, there is hope for a lot of SMEs who are able to utilise schemes that have been put in place to provide support.

  1. We at Paymentsense offer small business funding to our customers to help boost businesses with loans from £1k to £1m, depending on your monthly card revenue. Businesses can also utilise Start Up Loans and the Help to Grow scheme from the Government.
  2. When applying for funding, make sure you research the type of funding you need, how much funding you require and what it is for. This way, when applying it will ease and simplify the process. Here a few important points to consider:
    • Have a business plan in place
    • Does your cash forecast align with your business plan?
    • How much money will you need from your business?
    • Review your plan frequently
    • Know what your are applying for and why
  3. There are many free tools small businesses can utilise to cut costs, such as;
    • Google Analytics: this can be used to better understand the traffic that is reaching your site and the behaviour of site users.
    • Earn: an online finance app which allows business owners to organise transactions into business and personal accounts to make the tax process easier.
    • Mailchimp: this email marketing tool is free and easy to use. It is a great way to organise your mailing lists.

How to maximise innovation in your business

There are many ways you can ensure innovation is happening within your business. It can be difficult to create something new and think outside the box, so it is essential that creatives and entrepreneurs within a business are able to innovate using their skills without any barriers. How you think of fresh ideas may be different to the next person, so working in a way that is best for you is essential.

To help get your creative juices flowing, we’ve pulled together three ways to help drive innovation within your business:

1. Bring people with different perspectives into the team

Having a diverse team of people who have different perspectives is important for approaching a task from all different angles. Allowing for unique passions, skills, abilities and backgrounds is a great way to ideate fresh ideas using an innovative approach.

2. Have innovation as a core value of your business

Everyone in the business needs to understand that by not stepping outside the box and trying something new, can sometimes be the biggest risk to a business. Encourage your employees to share their ideas, big or small. Allow them to explore their initiatives and be honest and open.

3. Offer training to your employees

Inspire and motivate your employees by offering training that will inspire creativity and approach tasks in a different way.

Stand out Kickstarter Projects 2022

  • Focus Timer - Focused around increasing productivity, this focus timer can be set from 1-100 minutes. Watch the ring of lights circle round and listen to the calming chimes to enhance your productivity.
  • AnkerMake M5 3D Printer - Scale up the power of printing in your home with the AnkerMake 3D printer. This print aims to cut printing time by 70% and produce finer details.
  • Magic Dock - Speed up the charging of your tech devices with the Magic Dock. No more waiting around for your MacBook to charge to get on with work.

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Data was gathered from multiple different sources to identify the most innovative cities within the UK and worldwide. This was based on multiple data points, including number of business registrations, patent applications, number of universities and more. All index points were evenly weighted and ranked fairly.

UK data points:

  • New startups per 10,000 population | Sourced from Centre For Cities as of August 2022
  • Patent records per 100,000 population | Sourced from Centre For Cities as of August 2022
  • Average monthly SV and trend for ‘how to start a new business’ | Sourced from as of August 2022
  • Number of Kickstarters | Soured from as of August 2022
  • Number of registered businesses | Sourced from ONS.Gov as of August 2022
  • Number of newly registered business by region | Sourced from ONS.Gov as of August 2022

Global data points:

  • Google patent Applications | Sourced from as of August 2022
  • New business registrations | Sourced from data.worldbank as of August 2022
  • Number of top universities and the average ranking | Sourced from Round Ranking as of August 2022
  • Average monthly SV and trend for ‘how to start a new business’ | Sourced from as of August 2022
  • Number of kickstarters | Soured from as of August 2022

[1] Business population estimates for the UK and regions 2020

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