Atlanta Can Compete

Dave Coustan sent me a note today suggesting that he was expecting to see an opposing view to Paul Graham's recent post on Why to Move to A Startup Hub.

This led me to a write up that he did on a speech at FOWA where he claimed that "Atlanta is hosed." 

I beg to disagree with Mr. Graham. For that matter so does Brian Oberkirch, (one of the organizers of FOWA) who unlike Paul or I has no vested interest, in his great write up with loads of links, "Where is Your Startup? Why Does It Matter?"

Here are seven reasons why Atlanta is a startup hub and not hosed.

1.  All the ingredients

A while back Paul noted how to be Silicon Valley.  Great post.   Atlanta has all the pieces to make this happen.  My post on the subject at the time.

2.  Formal support organizations

VentureLab commercializes intellectual property created at Georgia Tech and ATDC is a technology incubator that helps Georgia entrepreneurs launch and build successful companies.  Both are nationally recognized as best in class.

3.  World class universities

I am amazed that both Georgia Tech and Emory are a mere five miles apart.  Part of Stephen Fleming's pitch is that Tech is the number 4, which ain't so bad when those ahead of you are MIT, Cal Tech, and Stanford.  We have the smarts it takes.  And Tech's College of Computing is at the forefront of the changes needed to create students that can start their own companies.

4.  Local seed funding

The Atlanta Technology Angels and Seraph Group are strong angel organizations.  On top of those groups there are too many individuals to count.  While this is moaning from time to time from the entrepreneurial community, I have seen evidence of those that have been successful investing in new companies.

4.  Quality Venture Capitalists that are willing to travel and invest here

$1,000,000,000 in ATDC companies alone since 1999.  And every month a VC firm from either Boston or SV gets on a plane to come look at what ATDC and VentureLab companies are working on.  NEA just invested $5 million on a concept.

5.  Y-Combinator can be cloned

Look at TechStars.

6.  Quality of life

I have seriously considered moving to SV.  Not going to happen.  Cost of living is too high to do so in startup mode.  It is much more capital efficient to startup in an area that has all the important resources that you need to move your company forward with a low cost of living and good quality of like.  Atlanta fits that bill.

7.  World view

While there are many advantages to being in SV.  I can think of one big disadvantage.  People in the valley have a distorted world view.  The valley's reality is very, very different than the vast majority people in the USA or the world.  They tend to forgot that from time to time.  This is not a good thing when you are building software.  Twitter and Facebook are all the rage in the valley.  Most of my relatives, spread across the country, have heard of neither.

Atlanta may not be the Antwerp of the diamond cutting world, but the diamond district in NYC gets along pretty well.  And so will Atlanta in the world of startups.

Quote of the Week

"The Internet wasn't designed for people to watch television. I know because I designed it."

Larry Roberts

Financial Model Numbers

When both Guy Kawasaki and Fred Wilson post on the same item in the same week its gotta be good.  What were these guys talking about?  A write up by Glenn Kelman of Redfin in which he exposes the numbers Redfin used in their financial model, what the actuals turned out to be, and ten lessons (it is on Guy's blog) learned.

Must reading for any startup at the stage of building/modifying a financial model.

Money line is Guy's advice: “the three most powerful words you can utter at a board meeting are, ‘We beat projections.'"

Closing Day

Seems like the City of Atlanta has come to its senses and is abandoning the "Every day is an Opening Day" marketing campaign.

According to Ken Bernhardt, who did some research on the matter, only 3% of respondents could recall the slogan.  On top of that, participants in test markets (where the ads ran) were less likely to recommend Atlanta for a weekend getaway then those markets where Brand Atlanta did not advertise.

And while I have to buy soap to take to school so my kids can wash their hands after they go to the bathroom, the city spent $15 million on this. 23%, an outrageous amount, was spent on ad agency fees.  Shame on you Grey Worldwide, Lattimer Moffitt, Spunlogic, and Ignition.

Money quote; "This was really just a joke from the beginning."

Indeed.  Told you so.