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Cities where startups are thriving

Say "startup" and most think Silicon Valley, Austin or Boston. But investors and entrepreneurs say a new group of startup cities is emerging -- some in unlikely places.

Nashville, Tenn.

gallery startup cities nashville tn

Nashville-born rapper Young Buck was on to something when he called it Cashville.

Music City, USA has long been a hub for entrepreneurs -- from musicians to the record companies that back them -- but these successes rarely worked together. That's changed.

In 2010, the city's chamber of commerce created the Entrepreneur Center, which brought investors together and offered startups mentoring and fundraising opportunities.

It's working so far, as Nashville has shot up the ranks of PricewaterhouseCoopers' MoneyTree report, which gauges venture capital activity. The city's investors have put $72 million in 21 companies so far this year, compared to $38 million in 8 companies in 2009.

Nashville also offers startups a lower cost of living than rival cities in Silicon Valley or the Northeast. Jerry Bostelman, CEO of a staffing company there, said young entrepreneurs are wrong to think Nashville is just "some hillbilly town."

- Last updated November 27 2012 07:59 AM ET