After a year and a half of remote work and life, it’s refreshing to see communities starting to (safely) reconvene in person — including one of my favorite communities, the Atlanta tech ecosystem. NEA has been a big supporter of Venture Atlanta for several years, and it’s with great (Georgia Tech alum) pride, that I participate in many of the group’s initiatives to foster collaboration and growth across the Southeast tech and investment sectors. I was thrilled to have the opportunity to moderate the keynote Building a Unicorn in the Southeast panel at this year’s Venture Atlanta conference this fall, and have an insightful, transparent discussion with successful tech leaders: Tope Awotona, Founder & CEO, Calendly; Tim Sheehan, Co-Founder & CEO, Greenlight; Kabir Barday, Co-Founder & CEO, OneTrust; and Eric Boduch, Co-Founder, Pendo. Our session surfaced some recurrent company-building themes, as well as a few that surprised me. In order to extend the reach of these founders’ valuable experience, I’ve summarized the top takeaways below.
Location Can Be an Accidental Advantage
All of these companies were started in one of the co-founder’s current home cities; moving to a tech hub wasn’t part of the founding equation. These founders felt confident in starting companies in the Southeast because there was a common belief that great companies can be built anywhere and first hand examples of great outcomes from startups in remote cities.
Many unforeseen advantages surfaced, including: great engineering talent (who also doesn’t want to move), less employee turnover leading to rapid and sustained product development, and lower cost of living resulting in less burn and more overall capital efficiency. The central location was particularly advantageous when selling internationally with the timezone being more compatible with European markets and close access to the busiest airport in the U.S.
Big Tech Companies Can Make for Nice Neighbors
Access to senior level executives who have directly applicable experience has been the biggest challenge in the Southeast, but with big tech coming in and executives moving to start those offices, senior talent is becoming more available. Big tech companies opening local offices shines a spotlight on these cities as emerging tech hubs and great places to move for a career in tech (especially for those looking to escape areas with high cost of living).
Contrary to inclination, there are little to no negative effects for very early-stage companies because early-stage talent often is not attracted to big tech so talent wars are not an issue. Additionally, later stage startups are unaffected because they are at scale where they can compete with compensation packages and benefits resulting in more upside for folks looking to work at bigger companies. Mid-sized startups are the most impacted by local big tech.
The topic of fundraising led to a unique discussion — fundraising didn’t have a regular cadence and wasn’t milestone based. These companies raised capital when they first started and then they wanted to get the business running as efficiently as possible. Being outside of Silicon Valley minimized the feeling of needing to raise for the sake of raising and allowed the founders to prioritize raises around achieving a particular goal. Most companies ended up not needing the capital to build the company or to achieve high growth, but for other reasons like offering liquidity to employees, getting a market valuation to be able to attract later stage talent, acquiring companies to expand their platforms more quickly, etc. Once they achieved revenue a flywheel effect emerged, attracting investors without concerted effort.
Community and Scale Have an Inverse Relationship
The number of founders of companies at scale is much smaller than in big tech hub cities. While there are some drawbacks to that, there are also some benefits — many of the founders in these cities know each other and lean on each other frequently. The smallness of these circles results in deep and authentic relationships. It also results in a lot of connective overlap — for example we learned that Tope (Calendly) recently joined the board at Salesloft which is also based in Atlanta. I wouldn’t be surprised if we see more of this happening since a lot of great knowledge sharing and collaboration already exists.
Mentorship is Major
These founders were all grateful to have access to relevant local experts who were generous with their time and encouraged them to think bigger. Mentor relationships sometimes led to angel investment or board membership, which was hugely validating. The tricky part was figuring out when to seek out new mentors and transition old mentors to friends, a necessary change in order to continue getting support at new stages. Everyone had experiences around evolving mentor relationships.
And finally, some lasting, impactful words of wisdom came from our panel wrap up: celebrate the milestones and make sure to have some fun along the way; surround yourself with great people — they’re worth the wait; stay open-minded and listen to the market; and don’t forget to prioritize yourself, your relationships, and your well-being.