David Cummings on Startups

Common Complaints in Atlanta’s Startup Community

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David Cummings

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Yesterday I was talking with a visitor at the Atlanta Tech Village who moved to Atlanta recently. After covering a number of subjects, he brought up several common complaints he’d heard about Atlanta’s startup community. We spent 10 minutes talking through them and I offered up an insider’s perspective.

Here are some common complaints about Atlanta’s startup community and ideas about them:

  • Lack of Talent – With Georgia Tech (one of the largest engineering schools in the country and top five academically), there’s a tremendous amount of technical talent in town. When large companies complain about a lack of talent, it’s a function of culture and desirability of work environment (large companies find it easier to open an innovation office in a different city as opposed to making the harder changes at their headquarters).
  • Dearth of Capital – Capital is still scarce but the cost of building a product and signing the first 10 customers has gone down by 90% over the past 10 years, making limited capital a non issue to get started (see Assembling a Minimum Viable Product for Market Validation). Scaling a startup is still capital intensive, but once revenue is growing nicely, even at a modest scale, it’s easy to raise money as capital is much more mobile (see AngelList).
  • Disconnected Community – Community cohesiveness is stronger than ever with a number of regular events, entrepreneurship centers, and leaders committed to strengthening the community (check out the open-to-the-public Atlanta Startup Village with 350+ attendees every month).
  • Limited Number of Exits – Every year Atlanta has 3-5 $100M+ exits (see AirWatch and Silverpop already this year). Atlanta startups do have a higher bar for an exit, but there’s a steady flow of success stories.

I’m sure these complaints aren’t unique to Atlanta and are applicable to most regions of the country. So while there’s plenty of room for improvement and growth in Atlanta’s startup community, many of the common complaints are outdated and not as relevant.

What else? What are your thoughts on these common complaints in Atlanta’s startup community?

Comments

6 responses to “Common Complaints in Atlanta’s Startup Community”

  1. sam Avatar
    sam

    Another often-heard complaint is that Atlanta startup culture is heavily white and male in a black majority city. Unfortunately, there aren’t any easy answers to that one.

    Reply
    1. David Cummings Avatar
      David Cummings

      I agree that diversity is an issue.

      Here are the Metro Atlanta demographics from http://en.wikipedia.org/wiki/Demographics_of_Atlanta whereby Metro Atlanta is considerably different than the city limits.

      Reply
  2. SimianLogic Avatar
    SimianLogic

    We (@ dragonarmy) were discussing this a bit after the Mayor’s visit. I’ll toss “enterprise/b2b focus” onto the stack (though it can also be a boon). When I graduated from tech in ’07, my perception was that most of the engineering jobs in ATL were either enterprise java or some sort of .net stack and targeted at enterprise/b2b. The tech is slowly catching up to the west coast (love how much rails/JS I see around the village), but the focus on enterprise is at odds with keeping the GaTech talent local.

    I’m slowly warming to b2b apps as I get older, but it’s a hard sell for a single 20-25 year old to work on solving problems for fortune 500s when valley companies will throw money at you to party and solve problems for your own age bracket.

    Reply
  3. daleflipsfilm Avatar
    daleflipsfilm

    Your replies were accurate. I wonder what the source was about his perception of Atlanta, since he seemed to have just gotten here. If he came from Silicon Valley, it definitely is a different culture but still valid in its own right. After watching Silicon Valley show on HBO (terrifically funny), I hope Atlanta never turns into that environment and retains the same “style” it has for affordable living, green space and other attributes.

    Reply
  4. Csaba Nagy Avatar
    Csaba Nagy

    “…the cost of building a product…has gone down by 90% over the past 10 years…”
    I feel your article is heavily biased towards software products. Of course every geographical location has its strengths, but I wonder if a dearth of capital affects the grads from GT’s non-computer science engineering departments.

    Reply
  5. M. Allan Avatar
    M. Allan

    My $0.02 worth as a native Atlantan who now lives in Si. Valley: a big (if not #1) problem historically has been lack of risk-taking culture. There are a lot of reasons for this, including things like lack of high-profile exits which would entice someone to start a new venture. I know this is changing but I think there are too many talented people who are more than happy to work at large, stable employers and for whom starting a company and failing (and most of them will in fact fail) is not seen as a badge of honor. It’s (slowly) changing IMO, and mostly from recent college grads but not so much people who have spent 5-10 years in industry and understand key problems.

    Reply

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