Miami Startup Scene Grows Hotter During the Pandemic
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Miami has become a more desirable city than ever before. In an unexpected consequence of the pandemic, the tech industry is flocking to this glamorous southern Florida city.
The beginnings of the Miami tech scene hype trace back to a single tweet in December 2020. The tweet came from Delian Asparouhov, an MIT dropout working as a venture capitalist in San Francisco. Asparouhov is a principal at Founders Fund, a tech-oriented venture capital firm led by Peter Thiel and Keith Rabois. He had grown frustrated by the high cost of living in the Bay Area.
One night, Asparouhov posted a tweet where he proposed moving Silicon Valley to Miami. Francis Suarez, the Miami mayor with an outsized personality, saw the tweet while scrolling through his feed. One of Suarez’s political goals is to grow the tech scene in his city. Suarez posted a simple reply, asking “How can I help?” His tweet prompted chatter within the tech community after it went viral.
The tweet had a larger impact than many could have envisioned. Several tech companies, many from Silicon Valley, opened offices or relocate entirely to the Miami area. SoftBank, a tech company investor, pledged to invest $100 million in Miami-based startups in January 2021. Because of the city’s growing reputation as a startup hub, Palm Drive Capital, a New York-based venture capital firm, announced the opening of a new Miami office.
In addition to tech firms, financial firms are moving or expanding to Miami. Financial giants such as Blackstone, Goldman Sachs, and Citadel have opened offices in the area. Blackstone is betting on the city to grow its technology transactions team. The private equity firm believes Miami has the potential to attract and retain top tech talent.
In February 2021, Founders Fund signed a lease for a Brickell office building. Founders Fund’s has invested in notable tech companies such as SpaceX, Airbnb, Facebook, Palantir Technologies, and Postmates. Founding partner Peter Thiel purchased a mansion in the Venetian Islands. This chain of artificial islands is connected to the Miami mainland by bridges. Keith Rabois, a general partner, also purchased a $29 million home there.
Emerging Tech Startup Scene
As the director of investment at Miami Angels, Bruno Lulinski has observed “exponential growth” of the local startup ecosystem in 2021. According to data from PitchBook, the Miami-Fort Lauderdale-Pompano Beach area was ranked among the top 20 areas of the United States for venture capital deal volume and value.
While many have touted Miami as the “new Bay Area”, others have rejected that notion. “We are not replicating anything else. We are building something completely new and aspirational,” stated Michelle Abbs, a managing director at tech hub developer Mana Tech.
Moishe Mana, a billionaire businessman, is helping Miami’s downtown transform into a vibrant, diversified neighborhood that will attract startups, art, and culture. Mana Tech is spearheading the development of the newly created Flagler District.
More Job Candidates Open to a Miami Move
Several Miami startups noted that job candidates are increasingly open to exploring a move to the city. Andrew Parker, the CEO of Papa, a Miami startup that provides on-demand companionship to the elderly, reached a $1.4 billion valuation. Papa recently entered into a lease for office space in the trendy Brickell neighborhood. The office is designed with collaboration in mind. Parkers believes the office has a “mini-New York feel.”
Maxeme Tuchman is co-founder and CEO of Caribu, a video-calling app that facilitates playdates for children. She has also seen an uptick in the talent pool of candidates interested in Miami. “A lot of people saw what it was like to be locked down in a cold place,” said Tuchman. She noticed that during the winter months, interest in Miami spiked. After all, it is a warm location with a growing startup scene. “I got pings from my friends in Chicago, in the Bay Area, asking where a good place to rent is,” she commented.
In December 2021, Miami hosted Art Basel. NFTs quickly overtook the event. Thousands of NFT and crypto enthusiasts descended on Miami to attend gallery shows, interactive experiences, and parties. Miami’s association with emerging technologies like NFTs and crypto is also growing the city’s tech startup scene. Learn more about Miami’s growth as a crypto hub here.
Miami Lifestyle Appeal
Miami, nicknamed the Magic City, boasts several appealing lifestyle characteristics. Given the pandemic, it’s nice to have the option of working outdoors un the warmth. In addition, Florida is known for business-friendly policies and no personal income taxes. Its glittering nightlife and Latin American cultural influences make it a vibrant place to live, work, and play. Finally, the influx of high-profile companies and individuals moving to Southern Florida has fueled greater excitement about the city.
It appears the momentum surrounding Miami is not merely a fad and the city has long-term growth potential as a startup hub. Venture capital investments are on an upward trajectory. Also, many of the entrepreneurs and technologists who relocated to Miami at the beginning of the pandemic in search of warmer weather and fewer covid-related restrictions have remained in the city.