Fact Check: A Startup a Day in SD?

Fact Check: A Startup a Day in SD?

Photo by Sam Hodgson

Mayor Jerry Sanders at the 2011 State of the City address

 

Image: misleadingStatement: “On average, one technology startup is launched here every day of the year — including weekends,” Mayor Jerry Sanders said Jan. 12 in his sixth State of the City address.

Determination: Misleading

Analysis: As Sanders stood at the podium in Balboa Theatre delivering his State of the City speech, he highlighted San Diego’s strongest economic areas, including the Navy, defense technology and the biotech industry.

He focused most of his talk about economic development on San Diego’s technology companies, and his oration included the claim that, “On average, one technology startup is launched in San Diego every day of the year — including weekends.”

Alex Roth, the mayor’s spokesman, said this statement was based on results from the third quarter of 2010, the most recent data available from Connect, a technology advocacy group whose publications are generally regarded as the authority on local tech industry figures. Connect reported 94 technology startups launched across San Diego County between July 1 and Sept. 30, 2010.

Roth said because the third quarter was the most recent data available and because 94 startups launched over 92 days in that quarter, the mayor’s team felt it was fair to make the “one startup is launched every day of the year” statement.

But that statement doesn’t hold true for the previous two quarters of 2010, or the previous two years. In the first quarter of 2010, 51 tech startups launched, and 64 startups launched in the second quarter, according to Connect. So 209 startups launched over 273 days in the first three quarters of 2010, which would mean 156 new startups would have to begin doing business in the 92 days that make up the fourth quarter to reach 365 — the “one every day of the year” benchmark. (Connect’s results from the fourth quarter of 2010 won’t be available until the end of the month.)

The number of tech startups launched in 2009 and 2008 both fell short of that 365 benchmark: Connect reported 319 in 2009 and 299 in 2008.

Roth said the Mayor’s Office checked the accuracy of the statement with Steve Hoey, the senior program manager of Connect’s reports, in the days leading up to the speech. But Hoey said staff didn’t include the “even weekends” part of the sentence when they asked.

“Since there are about 250 business days per year, when they asked me if I agreed with the quote, I said yes,” Hoey said.

Hoey said because the number of new startups increased by almost 50 percent between the second and third quarter — from 64 to 94 — it’s possible the fourth quarter results will jump by the same rate. But even if they did, the total number of new startups in 2010 would come to 349 — still short of 365.

On top of this numerical reach is the fact that many of the new startups are in other cities like Carlsbad, Del Mar and Oceanside, not San Diego. To be sure, those new companies might have an impact on the city’s economy and the mayor’s use of “San Diego” could be interpreted to mean San Diego County. However, Sanders’ declaration was in his State of the City address.

We label a statement Misleading when it takes an element of truth and badly distorts or exaggerates it, giving a false impression.

In this case, the mayor didn’t define what period of time he was talking about. His statement did hold true for the number of new startups in San Diego County in one three-month period of 2010, but the numbers for the rest of the year, along with the two prior years, do not meet the same benchmark. Additionally, this number was countywide, not just for the city, a small point but noteworthy nonetheless because it is in the context of a section of the speech about how San Diego is an attractive place to do business. Lastly, the mayor’s source for the information says he wouldn’t have signed off on it.

This difference in total exaggerates the success of San Diego’s technology economy.

The statement as a whole took an element of truth — the third quarter numbers countywide — and exaggerates reality, fitting our definition of Misleading.

If you disagree with our determination or analysis, please express your thoughts in the comments section of this blog post. Explain your reasoning.

Please contact Claire Trageser directly at claire.trageser@gmail.com or follow her on Twitter at twitter.com/clairetrageser.

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Claire Trageser

Claire Trageser
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2 comments
Tyler Jensen
Tyler Jensen subscriber

Challenge: Not "Misleading," this claim is False or Huckster Propaganda.

Jensen
Jensen

Challenge: Not "Misleading," this claim is False or Huckster Propaganda.