During my recent trip to Silicon Valley, I met with the country’s leading venture capital firms to promote Atlanta as the technology center of the Southeast. Good news – our city is rising in stature among Valley investors as a destination point for investment. Several promising Atlanta themes were presented during my meetings with these industry-leading VCs.
- The Right Markets – Atlanta is viewed as having the right technology markets for expansion: mobility, healthcare, info security and financial technology. The business-to-business markets are considered the most attractive ones by many VCs. I highlighted the Metro Atlanta Chamber’s focus on mobility companies, our fintech innovation centers and the growth of our healthcare IT community.
- Employee Talent & Loyalty – Atlanta is recognized as having a pool of engineering talent thanks to Georgia Tech, and we are also touted for having a loyal and stable workforce. During my visit, a VC described the Valley as a “treasure hunt” for employees; if your current employer doesn’t wildly succeed, then you quickly move to the next one and the next, until you hopefully make your fortune. By contrast, Atlanta employees are seen as far more committed to their company’s success over the long term.
- Less is More – There’s a shortage of local venture capital investors in Atlanta -- but this is also viewed as an advantage by VCs in Silicon Valley. In the Valley, every hot company has been approached by many VCs, and valuations have risen accordingly. By contrast, the best opportunities in Atlanta are seen as largely untouched by the leading VCs, attracting them to our city to pursue investment opportunities at more realistic valuations. While this trend won’t continue forever, it makes Atlanta’s tech businesses attractive to West Coast funds.
- Business-to-Business – Atlanta is considered a haven of business–to–business entrepreneurial companies. By contrast, the Valley has pegged much of its success on the fast-growing consumer companies like Twitter, Facebook and Apple. B2B companies abound in Atlanta, and Valley investors see them as ripe for West Coast capital. Although the growth rate for Atlanta B2B companies may not be supersonic, the opportunities for rapid growth still make Atlanta a favorable investment environment.
- Fortune 100 Community – Our mature Fortune 100 company base makes Atlanta fertile for entrepreneurial companies to find pilot and beta customers close to home. The Valley VCs recognize the value of having prospective customers in the backyard of an entrepreneurial business, and Atlanta is unique in this regard. VCs also desire to foster close relationships with F100s as prospective customers for other portfolio companies and possible limited partners in their future funds.
Look for more visits from Silicon Valley venture funds in the coming months - and let’s encourage their ongoing support of Atlanta’s technology and start-up community.
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John C. Yates is the chair of the Technology Group at Morris, Manning & Martin, LLP. This column is presented for educational and informational purposes and is not intended to constitute legal advice.
Posted with permission from the Atlanta Business Chronicle.
