Atlanta, Ga. – which became known in the 1960s as the
“city too busy to hate” for its inclusive culture – is apparently also too busy
to toot its own horn.
Because despite a mounting list of homegrown successes
and headline-making exits, Atlanta’s thriving tech startup scene is rarely mentioned
in the same breath as its well-publicized peers out west and up north.
“It’s a marketing issue, not a talent issue,” remarks David Cummings, serial software entrepreneur and torchbearer for the city’s startup scene. “People in the South tend to be more modest, more humble. We could definitely do a better job of branding Atlanta as a digital hub and sharing our story.”
And what a story it’s shaping up to be. Over the last decade, the so-called Capital of the South has emerged as a key player in the fast-growing industries of healthcare IT, marketing automation, e-security and mobile technology. Buzzed-about companies like email-marketing provider MailChimp, online deals service Scoutmob and mobile security provider AirWatch have elevated the city’s profile, and in 2012, three Atlanta-based startups in the marketing technology sector alone – Pardot (founded by Cummings), Vitrue and BLiNQ Media – sold for just under a half-billion dollars combined.
As a result, Forbes, PC World, Business Insider and other in-the-know sources have praised "Hotlanta" as a
hotbed of digital innovation and entrepreneurial mojo. And for good reason: The city is loaded with every ingredient a vibrant
startup culture needs: 260,000 high-tech jobs, a stream of top-caliber science and
engineering talent from 30+ area universities, big-city amenities coupled with
a relatively low cost of living, the world’s busiest airport, the nation’s
third-highest concentration of Fortune 500 companies (16), a nurturing government
and entrepreneur-friendly ecosystem, and a can-do, pay-it-forward ethos.
“There’s gold underground here,” says Scott Henderson, executive director of Hypepotamus, a collaboration space and startup community catalyst. “Generations of successful people and companies have grown here and reinvested here.”
“It’s not a lack of success,” he continues. “It’s a lack of sharing that success.”
Getting a successful business off the ground in Atlanta is no cakewalk, mind you. A sprawling footprint – and the snarling traffic that comes with it – can be counter-intuitive to collaboration and creativity. As a function of geography, pockets of entrepreneurial activity are popping up in neighborhoods throughout the metro area, creating a somewhat splintered community that lacks the density of other hubs.
Like-minded leaders are tackling this challenge head-on by opening collaboration and networking spaces where startups can work with – and learn from – each other. After selling Pardot to ExactTarget last fall, Cummings bought a 100,000-sq.-ft. building in the Buckhead neighborhood and opened Atlanta Tech Village, which now houses more than 300 entrepreneurs.
“There were lots of two- to three-person startups working out of their basements, unofficially subleasing office space, or doing the coffee shop thing,” Cummings said. “By creating a central gathering place with workshops, networking events and peer groups, we believe there’s an increased likelihood of success.”
The team behind Hypepotamus, located about five miles south in midtown’s Tech Square – ground zero for the city’s seed-stage startup scene – is on the same page. By fueling collaboration among what Henderson calls the four H’s – hustlers, hacks, hipsters and hackers – they’re focused on forging lateral, silo-breaking relationships.
“Density is destiny,” Henderson says, referring to the area that also includes Georgia Tech and the university’s Advanced Technology Development Center (ATDC), one of the top startup incubators in the country. “By creating an open-source talent magnet and driving awareness of what’s happening in Atlanta, we’re encouraging large corporations, media and investors to pay attention. We want to turn Atlanta’s ‘fragmented awesomeness’ into ‘connected awesomeness’ by bringing together entrepreneurs who have a shared commitment to building the startup ecosystem.”
Without question, one of Atlanta’s greatest assets is its institutions of higher learning, and the collective braintrust they funnel into the local workforce each year. But many graduating students are not thinking about startups as career opportunities, and the ones who are looking to join an emerging company don’t have Atlanta on their radar.
“A lot of talent leaves because we as a city and as business leaders haven’t communicated the great things happening here,” says Jeff Spence, president of Innovolt, a distributed electronics company founded in 2007 in Georgia Tech’s VentureLab and ATDC. “Atlanta is doing the same things the Bay Area, New York or Boston are doing, but they’re carrying a stronger brand than we are right now.”
Earlier this month, a group of Atlanta business leaders launched a campaign to cement the city’s reputation as a great place to live, work and grow a business. Nebo, an midtown-based digital marketing agency, got the idea for Choose ATL after seeing countless creatives flock to New York and San Francisco for career opportunities, or to Seattle, Portland or Austin for the promise of a more relaxed lifestyle.
“Atlanta’s transformation has been so quick that it doesn’t yet realize its prominent place on the world stage,” said Nebo CEO Brian Easter. “This is where economic opportunity and quality of life converge… we have the magic formula that breeds innovation and creativity.”
Other hubs do a better job of recycling entrepreneurial talent and franchising success. “Entrepreneurs exit, then land somewhere else and do it all over again,” Spence explains. “They also celebrate failure and recognize that it’s okay to launch a business that doesn’t make it.”
Cummings says uniting startups will fuel other startups. “By the nature of the beast, most startups fail,” he says. “What we’re doing is helping entrepreneurs build relationships with other entrepreneurs so that if and when they fail, they can bolt on to others that are winning.”
And as more successful startups enter the ecosystem, the tide of investment will lift all boats, says Ashish Mistry, managing partner at BLH Venture Partners, a private investment firm specializing in early-stage tech companies, and president and CEO of KontrolFreek, a performance gaming gear company. “By starting the cycle of M&A within our own community, we will recycle money and talent here,” says Mistry, who also serves on the Hypepotamus board.
The community is getting a strong boost from City Hall and other local organizations. The Metro Atlanta Chamber of Commerce is ramping up efforts to help cultivate a startup environment with staying power, pivoting its focus from luring big companies to Atlanta to nurturing homegrown enterprises.
“Over the next several years, a significant portion of new jobs created in the U.S. and right here in Atlanta will come from companies that don’t exist yet," says Larry Williams, the chamber’s vice president of technology development. “That’s why we’re encouraging companies to start and grow here.”
For example, the chamber works to connect area universities with local tech firms – big and small – to convert IP into viable companies that can launch and grow in Atlanta.
Williams cites the city’s loaded mobile tech sector – which includes content providers such as CNN, Turner Broadcasting System (TBS) and The Weather Channel, wireless carriers like AT&T Mobility, payment processing companies such as First Data, and network security companies including Dell SecureWorks and IBM Internet Security Systems (ISS) – as a major source of growth for the nation’s eighth-largest economy.
“Atlanta is where mobility meets the real world,” Williams says. “We’re not Cupertino trying to find the next gadget. We’re trying to make money and create efficiencies.”
Atlanta’s Fortune 500 companies also are doing their part to support the movement through leadership, resources and partnerships. AT&T recently opened one of its four Foundry innovation centers in midtown to challenge developers, investors and startups to develop lifestyle apps and services linked to Digital Life, AT&T’s home security and automation service, AT&T U-verse and other services.
Daly also is pressing for the Mobile Midtown partnership between the Midtown Alliance, incubators, accelerators, startups and Atlanta companies (including many Coke customers), which will create a “living development lab” for mobile apps and other technology to benefit people who live, work and visit midtown.
The world’s largest beverage company is learning from its neighbors, too. As part of its global focus on innovation and entrepreneurship, Coke is partnering with Hypepotamus to help build a startup culture. “We’re opening up the organization by learning from startups and the steps they take to build solutions. We also want to find problems we can solve together and encourage organic interactions -- helping starters scale and scalers start,” explains Carie Davis, global director, innovation and entrepreneurship.
Sian Morson is the founder and CEO of Kollective Mobile, an Oakland, Calif.-based mobile development agency. After 15 years in the Bay Area, she headed to Atlanta after positive experiences at several tech conferences, meeting passionate entrepreneurs and hearing friends rave about the community. The Southern hospitality she encountered was a pleasant surprise, too.
“I went for a run on the Atlanta BeltLine recently, and people looked me in the eye and said ‘good morning,’” Morson says. “People in New York – where I grew up – don’t do that. And California is ‘laid-back,’ but not necessarily ‘nice.’ There’s a level of niceness here that made my decision an easy one.”
She opened Kollective South, a co-working and community education facility that brings together creatives, freelancers and independent thinkers in Atlanta’s Castleberry Hill neighborhood. Morson’s vision for the space also includes helping bridge the “digital divide” by giving back to the community.
“We’ll offer classes for kids and adults on everything from the basics of using a smartphone to HTML coding, to mobile ideation and development,” she adds. “We want them to understand how they fit into the digital world and set them up for success.”
Atlanta and other emerging tech hubs should avoid trying to be the next Silicon Valley, Morson says. “There’s a newness to what’s happening here,” she says. “The key is to take the unique attributes you have – and Atlanta certainly has a fair amount – and build your own startup ecosystem.”
According to social entrepreneur, author and speaker Jeff Shinabarger, Atlanta’s attributes include a passion for launching businesses that serve the greater good. He’s the co-founder of GiftCardGiver.com, which collects and redistributes unused gift cards to people in need, and Billboard Bags, which trains and employs women refugees in Clarkston, just east of Atlanta, to make totes, satchels and other “upcycled” lifestyle products from discarded vinyl billboards.
He also founded Plywood People, a community of innovators tackling social needs through creative projects. The organization hosts events and retreats to help entrepreneurs bring their ideas “from the clouds to the concrete.”
“In an age of people building personal brands, we’re building brands around problem-solving,” Shinabarger adds. “I get calls every day from talented people coming up with cool new stuff. And they’re not just trying to make money… they’re creating solutions to brokenness they see in the world.”
Shinabarger predicts Atlanta will be known as a national hub for social innovation within the next few years.
“We have a rich history... CARE, the Salvation Army and Habitat for Humanity all call Atlanta home,” he says. “We’ve just never mobilized in a way where we can all benefit. This is a community of people rubbing shoulders and saying, ‘Atlanta is a city where I can launch something.’ There’s an optimistic, ‘we can do this’ mindset here.”
Jay Moye is senior writer and editor,