Atlanta: Signs of the Next Major Tech Hub

Atlanta, Georgia, USA downtown skyline.

The Question

Almost two full years ago, in January of 2017, Ryan Hoover asked me what the tech scene in Atlanta was like. I was in San Francisco, and had flown across the country (on a very cheap ticket!) to attend Product Hunt’s celebration party following its AngelList acquisition. We were hanging out on the upper floor of the venue, me, trying to look like I belonged there, and he, casually leaning against a wall, gratefully shaking hands with everyone who wanted a picture with him.

I was actually caught off guard a bit because, frankly, I didn’t know too much about the Atlanta tech scene at the time. I’d grown up here, but left for college in Boston, and if I’m being honest, I only meandered back here after school because of family & the post-college reality of starting a company with essentially no money. As much as I enjoyed my childhood, I’ve never been much of an “Atlanta guy” — I’m a Mets & Red Sox fan (for the rare times I watch sports), I like the cold, and I yearn for the deadpan, brash humor of the Northeast. But I recognized financial reality and made the best of my situation.

The truth was that I hadn’t really invested much time or effort into exploring the Atlanta tech scene. I was head-down working on my music startup, so I was spending more time wiring myself up in the music industry than the startup world. Additionally, everything in 2014-2017 was (or seemed to be) San Francisco, New York, L.A., or Seattle, and that’s where my head was too. I figured it was only a matter of time until I left Atlanta.

From Bust to Boom

Part of the frustration I felt personally during this period was how the tech scene here felt & the tech press seemed to view Atlanta after Yik Yak’s failure: “well we tried, but Atlanta’s not ready for real tech investment yet,” despite our having TechStars, MailChimp, and Calendly, among others. This coupled with “go to California, that’s where all the money is” mentality.

But things change. Calendly has grown. MailChimp is a bona fide unicorn. Salesforce is building Salesforce Tower downtown. And now, Walker & Company Brands is moving here, following their sale to Procter & Gamble. And these are just the names many people are familiar with; there are others, blooming down at the Tech Village, scattered around Buckhead and Midtown, popping up around Tech Square, and nesting outside the Perimeter (OTP) in Dunwoody and Sandy Springs.

On the Cusp

Atlanta is fast becoming a tech hub for crypto, SaaS, and media startups. Yet it’s still not mentioned in the same breath as Austin or Denver. Why this is could be a topic for debate, but what ultimately matters is that 2019 will bring a new sense of tech startup intrigue to Atlanta. Warm weather, affordable housing, and ready pools of talent from at least 5 major universities in town (Emory, Georgia Tech, Georgia State, Spelman, & Morehouse) — not to mentioned UGA just over an hour away — are some of the unavoidable perks of the city.  And, we’ll begin the year on a homegrown IPO and a major acquisition coup.

What’s missing — at the moment — is the same sort of starry-eyed, dare-to-dream-it dynamic which pervades tech in SF and NYC. Yes, we have SaaS meetups, startup chowdowns, and interesting groups which meet in the rooms of the Tech Village.

But what we really need to invest in are the more abstract, informal meetups, dinners, and coffee-shop interactions which don’t require reserving a room or having a planned discussion for each get-together. It’s these more abstract, informal dynamics which will generate some of the most exciting ideas, build reputations & relationships, and draw investment to the city in a way that’s more representative of the “dare to dream, go for broke” feel of Silicon Valley.

The Next Crop

As with everything, there will rise a set of core voices and personalities who help shape this new era of tech in Atlanta. They will be the people who just “seem to be everywhere,” seem to know everyone, and have a vision for how to transform the city in the next 5-10 years. It will be interesting to see who’s included on this short list.

I expect that we will soon be seeing more tech conferences here as this new mentality sets in. And while I may not start rooting for the Braves anytime soon, I will nonetheless have my eyes peeled for this group of individuals with the vision to make Atlanta the next great tech hub.

Why Silicon Valley Is Rebuffing the Wall Street Journal’s ‘Andreessen Horowitz’ Piece

Marc Andreessen (left) and Ben Horowitz (right); image courtesy of Forbes

Marc Andreessen (left) and Ben Horowitz (right); image courtesy of Forbes

First Serve

Yesterday, the Wall Street Journal ran an article on the VC firm Andreessen Horowitz (hereafter, ‘a16z’). The piece took a look at the firm’s raise-rounds and returns, and was critical of a16z’s placement among other “venture-capital elite” like Sequoia, Benchmark, and Founders Fund.

While the article is quick to throw around numbers and buzzwords like “elite” and “blockbuster [investments],” the main premise is that a16z hasn’t yet earned the “premier reputation” that it has amongst those in the tech community.

Second Serve — Response

The response from the tech world basically ate up the rest of yesterday afternoon and night.

It started with a response blog post from a16z managing partner Scott Kupor, which was posted not long after the original piece went up: When Is a “Mark” Not a Mark?

One thing Kupor points out immediately is that “marks” and “returns are two very different things in the realm of venture capital. Further, “[c]ash or stock actually realized and distributed to LPs is the only real, non-manipulable measure of a firm’s interim success.”

Kupor is articulating that the data which the WSJ published is somewhat misleading because it chose the metric of unrealized returns to match the title of the article. He further fleshed out this argument as the post went on.

Then the flood began.

Mark Suster wrote a great response of his own here: What to Make of Andreessen Horowitz’s Returns?

One of Suster’s most intriguing points is when he plots the line of thinking lot of VC’s have had about a16z over time, from “ ‘We love Ben and Marc’ and ‘they raised how much’ to ‘…they sure are hiring a ton of staff…’ and ‘How can we hire more staff to keep up with the services they offer?’. ”

More importantly, though, Suster puts into context a reason why a16z might already have the reputation that it does — that most entrepreneurs perceive it as a place of great connections and services, and that he himself has had positive experiences with the firm when they’ve done deals with Upfront Ventures (oh which Suster is a part).

Twitter Thoughts

All the while, I was intrigued to see the flow of responses over Twitter:

 

 

 

 

 

 

Why the WSJ’s Focus on a16z’s “Rivals” Is Misplaced

Part of what I find so intriguing is the direct aversion to a dynamic that is perpetuated in the original piece. Whereas the WSJ article paints a broad picture of a16z in relation to its “top rivals,” here are numerous responses from VC’s who run other funds seemingly going to bat for Andreessen Horowitz. In my opinion, this is something exceedingly important which the article skates over.

Yes, these different funds and investors compete for the best deals and the best founders/companies to work with. But most don’t do in a way that makes it easy to label them as rivals.

The term “rival” has a finality to it, as if it’s a forgone conclusion that those two parties will always be on opposite sides of the table. Yet inasmuch as everyone in this business wants to “win” at deals, the metaphor I see is more of a music one than a sports one. In the latter, there’s one winner, one champion. The former, however, creates a paradigm where multiple winners can exist, and where there is a fluidity regarding partnerships and mutual benefits.

Funnily enough, the WSJ added this little blurb to the original article not long after, though really without restructuring its initial argument to account for Kupor’s points:

Screen Shot 2016-09-02 at 12.03.58 PM

So what’s the takeaway in all of this?

  • First and foremost, understand the numbers, terms, and dynamics you’re working with and writing about. That seems to be a point of disconnect between the original article and the response pieces.
  • Second, things are rarely ever as simple as they appear to be.
  • Third, there is a way to write hard-hitting journalism without [publically] making enemies; if you don’t know how to do this, you should alter your writing strategy.

While I wouldn’t call the response to the initial article “biblical” by any sense, it nonetheless provides a good window into the dynamics of venture capital thought and strategy. If nothing else, founders have now been given a good variety of response posts to read and understand, particularly with regard to VC fund calculation and long-term plays.

I know what I’ll be doing this weekend.


If you enjoyed this, find me on Twitter @adammarx13 and let’s talk music, tech, and business!