Greater Phoenix is poised to become a destination for venture capital, with a booming entrepreneurship ecosystem, surging startup funding and a new wave of advanced manufacturing and software innovation investment.
What the region needs is more people ready to invest in big ideas in a place typically defined by people who invest in land, said venture capital leader Jack Selby.
So in 2020, Selby, along with a cohort of business and civic leaders, led the founding of Copper Sky Capital, raising $115 million to provide growth funding primarily to Arizona entrepreneurs. A founding employee of PayPal, Selby has been investing at scale since 2002 and today serves as Managing Director at Thiel Capital.
“The whole ecosystem in Arizona, in so much of the West, was like buying real estate, and then you put something on it, you get cashflow, and you turn that into resources,” Selby said. “Now we are growing past that.”
Greater Phoenix, a region of 5.21 million people, is a startup market characterized by pragmatic entrepreneurs who have been historically undercapitalized, which means investors who enter the market now can achieve remarkable dividends, said Selby. “There’s real opportunity here. Some other startup markets are bubbles,” Selby said. “But Phoenix is a place where people with vision can get in on the ground floor.”
“There’s real opportunity here. Some other startup markets are bubbles,” Selby said. “But Phoenix is a place where people with vision can get in on the ground floor.”
Arizona has had a modest startup ecosystem for the better part of 20 years, powered by the three state universities and angel investments to stand-up businesses. This was further nurtured in 2016 with the launch of invisionAZ, a nonprofit created to help advance the state’s tech ecosystem, with Selby as the board chair alongside leaders from Carvana, Mayo Clinic and APS, among others. And it worked, to a point.
Since 2018, according to PitchBook, the 22 municipalities that make up Greater Phoenix have exceeded the $1-billion VC threshold for seven consecutive years, with a 146% increase in investments from 2014 to 2024, ranking second only to Raleigh (180 percent) and well above peer markets including Atlanta (58%), Salt Lake City (4%) and Austin (86%).
But for seed-stage funding under $5 million, people typically had to go to Boulder, Colorado, or Salt Lake City, Utah, or Sand Hill Road in Silicon Valley. And in those cities, most investors want entrepreneurs to build where the investment is made, exit and reinvest the capital in that ecosystem. “No one ever goes to Phoenix on an IPO road show,” said Selby. “The idea in setting up this fund was this was the last missing ingredient to catalyze the fifth-largest city in the U.S.”
Connecting with Bluetail
This is the landscape Scottsdale resident Roberto Guerrieri faced when he launched his first startup in 1999. He’d left Apple in Silicon Valley and moved to Greater Phoenix for a better quality of life for his family, but he kept going back to raise capital. He was thrilled in 2020, when Copper Sky Capital launched and came in as a lead investor in Guerrieri’s Bluetail, a SaaS company that digitizes, organizes and analyzes aircraft maintenance records with AI, all securely managed in the cloud.
The investment was an easy choice, said Selby, as the Valley is an ideal growth market for an aviation business, with an expanding roster of small airports, as well as a hub in Phoenix Sky Harbor International and the large regional Mesa-Gateway. The region is also rich in aerospace and defense businesses like Honeywell, Northrop Grumman and General Dynamics, and is a fast flight or a half-day’s drive from California markets.
“Phoenix is a collateralized city,” said Guerrieri, who co-founded Bluetail with fellow Apple alumnus Stuart Illian, an aviation expert and pilot. “When I built my first startup … people were like, ‘What is the collateral?’ They were used to investing in land. The collateral in the Bay Area is silicon. And I think (Arizona is) moving from a land economy to an information economy. And that takes time. But make no mistake; I am getting calls now from VCs all over America about Phoenix.”
Which matters, because even with the region’s growth, Arizona captures less than 1% of U.S. venture capital; nearly 75% was spent in New York, California and Massachusetts in 2025.
“Now we have to move the financial capital to where the human capital is,” said Selby. “The human capital has been moving to Maricopa County in record numbers for two decades.” And, he continued, the COVID-19 pandemic drove a massive migration of talent across the country, “People moved here from shoeboxes in Menlo Park (California), and bought a house in Tempe, and it democratized talent more broadly across the country.”
"This is a place where hard work, ingenuity, and grit and hustle allows you to achieve your dreams.”
Operational hustle defines Arizona’s startup ecosystem, said Guerrieri. This is a powerful asset: “The bottom line is, if you don’t operate, you don’t have a company.” And, he points out, this is where experienced, connection-rich investors like Copper Sky Capital can come in to provide some of the vision needed to leverage that hustle.
Supporting Arizona Entrepreneurship
The fund formally launched in 2022 as AZ-VC, and the majority of the capital has since been deployed, with 90% going to startups in Arizona. The state is rich with entrepreneurs, as Selby sees it, predominantly populated by people from elsewhere who’ve already taken a risk on themselves in moving there. It ranks seventh in the nation for startups, according to U.S. Census data.
“As an investor, you are self-selecting from a good pool,” he said. “These are kind of hustler, scrappy types who are entrepreneurial ... They are trying to do something real, that deserves capital, and that has already shown to be a product-market fit. There is this hustler DNA in the water there.”
"Arizona has developed a mature support ecosystem," said Jessica Pacheco, one of Copper Sky Capital's managing directors, one of her many civic leadership roles in the state. “And we want to support our own. We want to give you access to what you need to be your best professional self.”
Business leaders routinely offer entrepreneurs access to advocates, mentors, people lobbying the legislature, to university resources and data, she continued. “When you come here, you have access to the people who built the Valley, who were pioneers and you can learn from them directly. This is what Silicon Valley used to be when you could move there and get funding, and start your tech startup. Now, you’re not getting a meeting with anyone on Sand Hill Road unless you’re already a big-deal person.”
Instead, Arizona is all about access, she said. “What I love about Phoenix is that you can come from anywhere and go everywhere. You can make your own name and your own legacy. This is a place where hard work, ingenuity, and grit and hustle allows you to achieve your dreams.”
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