6 Miami-based investors share their views on the region’s startup scene

Miami is quickly becoming a symbol for the tech exodus from Silicon Valley. The area is home to a number of investors, successful tech founders and an eager local government.

For this survey, TechCrunch spoke to a number of investors about the area’s potential, opportunities and key players. This is the second survey TechCrunch published on the area and the first can be found here.

In this survey, these investors agree on several aspects of Miami. They see a huge opportunity for the region to become a major startup hub by utilizing its diverse workforce and wonderful quality of life. As they say below, the future of work is uncertain and Miami is becoming more attractive as workforces disconnect from office buildings.

We spoke to the following investors:


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Alexandra Wilkis Wilson, co-founder and managing partner, Clerisy

Where do you see Miami’s startup scene five years from now?

Miami’s startup scene has been growing and evolving over the past 5+ years thanks to local organizations supporting entrepreneurship including, but not limited to Endeavor Miami, The Knight Foundation, The Lab, Rokk3r Labs, eMerge Americas, Miami Angels and Wyncode. Many of Miami’s entrepreneurs, investors and startups have historically had ties to Latin America. I think going forward, the Miami tech scene will certainly continue to be a conduit to Latin America as it has been in the past. However, I predict more non-Latin American founders, investors, engineers and operators from cities like New York, LA and San Francisco, will also choose to build their businesses in Miami due to higher quality of life and more attractive tax rates. This dynamic will bring more relevant talent and a larger, more robust tech ecosystem to South Florida.

Remote work is pushing and pulling the global workforce. This means that offices will disappear from Miami, even with more companies moving in, but also more locals who work remotely for companies elsewhere. How do you see these factors impacting the city’s tech evolution?

I think we will see more diverse talent flow through Miami as a result of remote work becoming the norm. If employees technically headquartered in other cities are able to work remotely from anywhere, why not try out working from home while based in sunny Miami where one can be outdoors every day of the year? I recently joined a WhatsApp chat called “Nomads in Miami” that includes a variety of intellectually curious people from all walks of life (from creatives, to entrepreneurs, to traditional professionals) who are either temporarily in Miami this winter or have made a permanent move to South Florida. This chat is reflective of new groups of people coming to experience The Magic City. Anecdotally, I’ve found that many of these people who are “testing Miami out,” had never spent significant time in Miami before. I also recently joined another WhatsApp chat #miamitechlife that includes a local community of founders, investors, executives and local leaders to meet, collaborate and network while engaging in fun activities around Miami. There is an excitement and energy in Miami right now, and I believe it’s here to stay!

What industry sectors do you focus on within Miami (and beyond)? What is happening in Miami now that you’re most excited to fund?

I recently launched a growth equity fund called Clerisy with my amazing business partner Lisa Myers who was most recently a partner at L Catterton, a leader in consumer private equity. We are excited to invest in fast-growing consumer and techsumer companies doing over $ 10 million in revenue, are quickly scaling and need growth capital. We will fund businesses that meet our criteria in categories we like such as health and wellness, consumerization of healthcare, food and beverage, beauty, and other consumer and techsumer areas. I would be thrilled to find an investment based in Miami, however Clerisy is not focused on a specific geography. We will invest in businesses located in cities or countries where we have previous business experience and ample, relevant networks.

What are some of the local challenges you’ve encountered or seen founders struggle with? More generally, how should people looking to hire in, invest in, or relocate to Miami think about doing business in the city?

The Miami tech ecosystem is smaller than in the Bay Area or New York and arguably less intense, with fewer exits so far of which to speak. Although tightly knit, it is indeed welcoming to newcomers. I think this local hospitality is because Miami has had a bit of a transient nature among some of its inhabitants due to many Latin Americans coming and going every year, depending on the political or economic situations in their respective home countries. I think it will be easier than ever to convince new hires to relocate to Miami. The more success and exits Miami’s existing startups have, the easier it will be to attract more investment at the local level and more future talent.

Who are key startup people you see creating success locally, whether investors, founders or even other types of startup ecosystem roles like lawyers, designers, growth experts, etc.

On a local level, Miami needs a range of people to support its startup ecosystem: founders, high-quality talent ranging from engineers to marketers to creatives, angel investors, venture capital and private equity funds, lawyers, and then ideally a loyal and engaged consumer base that proudly supports its local companies.

David Goldberg, general partner, Alpaca

Where do you see Miami’s startup scene five years from now?

Miami has everything in place to accelerate its rise to be cemented as a significant tech/startup ecosystem. It now has capital (investors), founders, talent and infrastructure, each growing by the day given the attractiveness to the area. In five years, I am confident Miami will only trail SF, NYC, LA and Boston in terms of size/deals.

Remote work is pushing and pulling the global workforce. This means that offices will disappear from Miami, even with more companies moving in, but also more locals who work remotely for companies elsewhere. How do you see these factors impacting the city’s tech evolution?

It’s a double-edged sword. In a positive sense, you’ll get founders moving here, building out remote/distributed/hybrid teams. You’ll also have individual employees living here, but working remotely for companies based in other areas. What will be harder to get is the giant company all built from scratch with everyone local. These successes (e.g., Uber in SF) create thousands of future founders, operators and investors that pay it forward in their ecosystem. Without that, it will be tough to truly crack the top tier.

What industry sectors do you focus on within Miami (and beyond)? What is happening in Miami now that you’re most excited to fund?

As a firm, we focus broadly on consumer, marketplaces, e-commerce infrastructure, real estate technology and fintech. Given the influx of talent, I’m not sure if Miami needs to be pigeonholed to a few sectors. Traditionally, it’s been known for travel/hospitality, healthcare tech and real estate tech, but I’m already seeing emerging trends around blockchain/crypto, fintech, remote work and even some traditional enterprise SaaS. Miami is also an incredible bridge to Latam and South America and I can see a slew of companies taking advantage of that.

What are some of the local challenges you’ve encountered or seen founders struggle with? More generally, how should people looking to hire in, invest in or relocate to Miami think about doing business in the city?

The physical dispersion can make it more difficult. Just in Miami, there are minihubs in Brickell, Wynwood/Midtown, The Grove, Coral Gables, etc. Then you have completely separate networks up north in Fort Lauderdale, Tampa, etc.

Additionally, Miami needs a bigger focus and contribution from its universities. Silicon Valley, LA, Boston and New York each have top-tier institutions that churn out tech talent. That’s still missing here.

Who are key startup people you see creating success locally, whether investors, founders or even other types of startup ecosystem roles like lawyers, designers, growth experts, etc. We’re trying to highlight the movers and shakers who outsiders might not know.

Honestly, I am uncovering more each day. And everyone likes to talk about the “big names” that have recently moved here, like Keith Rabois, Anthony Pompliano, Harry Hurst, Jon Oringer, etc. But I also have deference to the folks that have been here, working tirelessly for years, creating the foundation. Some that come to mind: Melissa Medina, Matt Haggman, Nico Berardi, Shervin Pishevar, Raul Moas, Nancy Dahlberg, Rebecca Danta, Moishe Mana, Laura Maydon, Brian Brackeen, Tony Jimenez, Brian Breslin, Juan Pablo Cappello, Mellissa Krinzman, Mark Kingdon, and now, of course, Mayor Francis Suarez.

Mark Volcheck, founding partner, Las Olas Venture Capital

Where do you see Miami’s startup scene five years from now?

We think that things are still very early, but are bullish on the future of Florida tech. One of the key things to work on over the next five years is the continued community building — right now, there are a lot of disparate groups and not much communication between them. Over time, that cohesiveness could really drive south Florida forward as a tech ecosystem.

Remote work is pushing and pulling the global workforce. This means that offices will disappear from Miami, even with more companies moving in, but also more locals who work remotely for companies elsewhere. How do you see these factors impacting the city’s tech evolution?

We do think there will be a future for offices and in-person collaboration. Across our entire portfolio nearly all companies have some plan to retain in-person talent. The biggest benefit is that remote work has enabled people in Big Tech to work outside of Silicon Valley, and it appears Miami and South Florida, more broadly, are enjoying the benefits of that decentralization. The distribution of talent will benefit founders here locally as the old VC expectations of tech talent to be hyperconcentrated in Silicon Valley is no longer as true, and people here locally will have access to better resources.

What industry sectors do you focus on within Miami (and beyond)? What is happening in Miami now that you’re most excited to fund?

Our fund targets two primary themes: B2B vertical SaaS and SaaS-enabled businesses/marketplaces, and broadly what we call knowledge worker tools — DevOps, cybersecurity and other typically product-led horizontal applications. Within vertical SaaS, logistics and supply chain tech has really taken off within the last few years, with even more tailwinds due to COVID’s impact on consumer demand and delivery expectations. As logistics is a huge industry for Miami and Florida, we think startups here have a very exciting opportunity in that space. We have now funded several companies in Florida across various aspects of logistics, from final mile delivery to long-haul trucking route optimization.

What are some of the local challenges you’ve encountered or seen founders struggle with? More generally, how should people looking to hire in, invest in or relocate to Miami think about doing business in the city?

Access to capital has been a significant problem for Florida-based founders since before we started our first fund back in 2016. There are relatively few funds actively investing in tech companies here at the seed and Series A stage, and essentially none post-Series A. Companies have historically had difficulty getting attention from Silicon Valley-based VCs due to the preconceptions of Florida as a bad place to start a company. Even as recently as last year the standard line from some Bay Area investors was, “Move out of Florida if you are serious about raising money.” That said, some of these preconceptions have been deserved, as historically South Florida as a business community has been prone to falling for flash over substance and that has occasionally been true for investors and startups as well. With the buzz around Miami and Florida as a place of interest for VCs and tech, we hope that attitudes around funding Florida companies have changed, as it is clear that good businesses can be built anywhere.

Who are key startup people you see creating success locally, whether investors, founders or even other types of startup ecosystem roles like lawyers, designers, growth experts, etc.

We’d like to mention all of our Florida-based companies who have been heads down building great businesses here locally — ReloQuest, CarePredict, OneRail, SmartHop and Plum. They are all hiring and growing like crazy, and several have received follow-on funding from top VCs. Check them out!

Maya Baratz Jordan, CEO and founding partner, Founders Factory New York

Where do you see Miami’s startup scene five years from now?

Cities with a diverse set of well-represented industries are often fertile grounds for building interesting companies. New York is a great example. Tech ecosystems thrive in an environment where you can unearth and solve a myriad of different problems versus just the problems of a single sector. The most interesting and lucrative companies tend to focus on blindspots in big markets. The blindspots are often discovered when they emerge out of silo and there’s a creative flow between industries. This is why I believe the diversity of industries and talent is ultimately a strength for Miami.

Remote work is pushing and pulling the global workforce. This means that offices will disappear from Miami, even with more companies moving in, but also more locals who work remotely for companies elsewhere. How do you see these factors impacting the city’s tech evolution?

One of the reasons it seems a lot of people are moving to Miami now is the fact that their job may not be tethered to a geographic location and they can work where they enjoy living. Given this unique strength to encompass work/life balance, Miami can experiment with hybrid models of working environments. Perhaps the dichotomy of working in an office versus working at home is dated. Offices were created for a time when technology used to be limited and the fastest way to communicate was in person. In-person interaction is important, but perhaps there are ways we can maintain [in-person interaction] that are not necessarily tethered to an office and that incorporate more ways to integrate with one’s life.

What industry sectors do you focus on within Miami (and beyond)? What is happening in Miami now that you’re most excited to fund?

Consumer healthcare is an area I’ve been actively investing in, and it seems like there’s been a lot of activity in Miami in that vertical, ranging from medical robotics to remote monitoring for chronic illnesses. I’m also interested in the future of work and the creator economy, and I believe the diverse set of industries in Miami will breed interesting companies that address the need for people to lucratively pursue their passions.

What are some of the local challenges you’ve encountered or seen founders struggle with? More generally, how should people looking to hire in, invest in, or relocate to Miami think about doing business in the city?

People in Miami joke that they run on “Miami time,” which is something between island time and how New Yorkers think of time.

Who are key startup people you see creating success locally, whether investors, founders or even other types of startup ecosystem roles like lawyers, designers, growth experts, etc.

Miami is a city built by immigrants, and that strength is what will allow Miami to thrive as a tech ecosystem; immigrants start businesses at higher rates than those who are native born. It seems like female founders in particular have been quietly building interesting and successful businesses here.

Sanket S. Parekh, managing partner, Secocha Ventures

Where do you see Miami’s startup scene five years from now? The city has attracted a wide range of people over the years, including more tech and finance companies very recently. How will it add up to something more than the sum of the parts?

If you think of Miami as a product and evaluate its adoption curve, it seems like we have reached the chasm. I.e., those of us who have been here pre-COVID are like those you’d characterize as innovators and the during-COVID crowd as the early adopters. Miami is at the point where we now need to prove we can continue on the curve from early adopters to early majority.

Five years from now we’ll hopefully be focused on headlines showcasing startups that are growing and hiring here, and not just about which investor has relocated here (which is also good, don’t get me wrong, but not the end-all).

We can also wish that Miami’s best traits — its international perspective, its racial, socioeconomic and cultural diversity — will infuse something unique and truly distinctive into the founders and investors building their businesses here.

Remote work is pushing and pulling the global workforce. This means that offices will disappear from Miami, even with more companies moving in, but also more locals who work remotely for companies elsewhere. How do you see these factors impacting the city’s tech evolution?

I don’t see a future where humans stop interacting with each other IRL. While how we “work” will look very different, offices “disappearing” is a bit of a stretch. It’s more likely that we will see an evolution of what an office looks like and how it functions as a “hub.”

Miami is full of disjointed “neighborhood clusters.” Up until now, this has been a negative, but given the changes we are going to see in how we work, I believe this is no longer as critical. In fact, it can be seen as an advantage where someone could live/work on the beach, and go to events/meetings at their “hub,” which may be elsewhere, when needed versus being so focused on living close to your workplace since you need to commute every day.

What industry sectors do you focus on within Miami (and beyond)? What is happening in Miami now that you’re most excited to fund?

While we’ve been based in Miami for the last seven years, we invest globally. In fact, COVID has made it even more acceptable to not be geographically constrained. This is the precise reason you are seeing investors move here.

We invest in fintech, healthcare tech, consumer tech and consumer products.

One of our most exciting portfolio companies is based in Broward: CarePredict. With the changes that COVID has brought about, they are uniquely placed to take advantage and provide the right dose of technology that eldercare requires.

Within our local ecosystem, Chewy and MagicLeap have been large employers. I’m most excited to see what their employees branch out and create in the coming years.

We are also excited to see a growing number of exceptionally talented founders moving to Miami to start their companies. These talents may have selected San Francisco or NYC previously, which is a great opportunity for us to meet exceptional teams at the infancy of an idea.

What are some of the local challenges you’ve encountered or seen founders struggle with? More generally, how should people looking to hire in, invest in or relocate to Miami think about doing business in the city?

Angel rounds are challenging here as compared to other more mature markets where founders or folks from the startup ecosystem play a larger role in angel rounds. Most local angels are used to investing in real estate, and approach early-stage deals differently than those who may be more accustomed to the asset class.

Hiring top-quality talent was also traditionally more challenging here than in tier-one entrepreneurial cities. With the significant influx of remote workers in the past year and the change in perceptions about Miami, we are hopeful that local companies will be able to overcome this challenge.

Miami is a collection of neighborhood clusters, as I mentioned earlier. If someone is looking to relocate here, they should spend some time getting to know what works for them before they commit to a neighborhood.

Who are key startup people you see creating success locally, whether investors, founders or even other types of startup ecosystem roles like lawyers, designers, growth experts, etc.

  • Venture Bites is a local grassroots organization made up of people passionate about the startup ecosystem. They organize educational sessions with key players from across the country and are also organizing a pitch competition with prominent public and private partnerships already in place.
  • Refresh Miami has been a vocal supporter and “info hub” for the community.
  • Miami Angels has been working tirelessly to get more angel investors into the startup ecosystem. There are a lot of high net worth individuals here, but it’s been historically challenging to get their attention away from real estate investing to startup investing. Hopefully, with Miami crossing the chasm it’ll bring more folks into the mix.
  • Animo Ventures and Las Olas Venture Capital are two other VC firms located in South Florida from pre-COVID days. Hopefully we’ll hear of many more setting up shop here in the coming months.
  • The Knight Foundation has been one of the most consistent supporters of the ecosystem and its impact cannot be understated.
  • 500 Startups is one of the very first Silicon Valley firms to have recognized the potential of Miami, setting up an office here a few years ago. Ana and her colleagues have been instrumental in stimulating and engaging the local ecosystem.

Laura González-Estéfani, founder, TheVentureCity

Where do you see Miami’s startup scene five years from now?

If the leaps we have made in the last five years are any indication of the next five, we believe Miami will be the next big tech hub in the southern United States. We have all the right pieces to make that true: engineer/developer schools and academies, startup programs and accelerators for seed, a thriving tech community, exits from founders reinvesting in the next generation of founders, influx of new capital, quality of life that tech company founders and employees are starting to prioritize, engaged local government as we have recently seen, as well as an incredibly diverse pool of talent.

Remote work is pushing and pulling the global workforce. This means that offices will disappear from Miami, even with more companies moving in, but also more locals who work remotely for companies elsewhere. How do you see these factors impacting the city’s tech evolution?

We believe talent has no zip code and smart cities are those that attract and retain the best talent — it’s no longer just about connectivity or infrastructures exclusively. In the past, people had to relocate to work at their dream job sacrificing too much personally. 2020 has just confirmed that you don’t need to sacrifice the way you want to live your life because of a dream job. The complaint we used to hear from talent was that there were not enough mid- to senior-level roles in Miami in tech — remote work has significantly strengthened Miami. Miami is a dream destination for a lot of people in different stages of life, so we see Miami also becoming a great remote work hub for those that can be 100% remote, even if they only spend part of the year here and then migrate to other climates. The workforce has more choices now than ever before and we think people will start to really put quality of life over job location. It is a true game changer.

What industry sectors do you focus on within Miami (and beyond)? What is happening in Miami now that you’re most excited to fund?

We have been based in Miami for the past four years and we invest from Miami to where the best founders are. Sometimes [they are] in Miami and sometimes in other states or countries. “We are from Miami to the world.” We are now witnessing a huge internal movement from other states to Miami, but many of us moved from our countries to Miami because of the immense opportunities Miami offers. We invest in software companies disrupting traditional industries, Health tech, fintech, mobility, cybersecurity and jobs. We have also invested in marketplace business models in products disrupting travel, pets, solutions for SMBs. We love giving a first ticket from $ 100,000 to seed stage companies jointly with a product-led growth program or a pre-Series A to a ticket of an average of $ 3 million through our Fund II. We love diverse companies, international mindset and execution over anything else.

Miami has always been an extraordinary hub for fintech, we are closely following interesting companies in this space and obviously health tech. We have to say that we have seen very disruptive companies in proptech and also very interesting marketplaces of all kinds B2C and B2B.

What are some of the local challenges you’ve encountered or seen founders struggle with? More generally, how should people looking to hire in, invest in or relocate to Miami think about doing business in the city?

Our biggest challenge has always been fighting the biases of people around Miami. You have to experience Miami to understand the opportunities it brings. It’s a very welcoming city where so many people will help you land. The next biggest challenge is that the amount of capital that Miami moves versus how much is invested in tech is ridiculous, really a pity. For this reason we need a fund of funds that supports the local funds so that they can develop the ecosystem on this front. And I am not talking about leftovers of capital that need to meet a quota or small initiatives. I mean people investing with true conviction in the asset. That is what gets the flywheel running, capital to fund managers that chose the right entrepreneurs from Miami or outside [and] that create jobs, etc. Let’s not forget that capital attracts founders and founders develop a huge industry that creates thousands of jobs. It is not only about investing in Miami, it’s also about investing from here to the world.

Who are key startup people you see creating success locally, whether investors, founders or even other types of startup ecosystems roles like lawyers, designers, growth experts, etc?

Sure, Juha and Johanna Mikola from Wyncode [since submitting these answers, the company was acquired by Brain Station], Andrew Parker from Papa, Claudia Duran from Endeavor, Victor Servin — CTO of TheVentureCity, David Smith — chief data scientist from TheVentureCity, David Marcus — chief product officer at TheVentureCity. Jimena Zubiria — VP of People at TheVentureCity, Anabel Perez-Novo — CEO of NovoPayment, Adolfo Babatz — CEO of Clip, Rodrigo Teijeiro — CEO of RecargaPay, Jackie Baumgarten — CEO of Boatsetter, Justin Meyers — CEO of Explorest and Vivek Jayaram (lawyer).

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“The European tech scene is growing faster than almost anywhere else in the world”: Interview with Emma Davies, co-CEO at Octopus Ventures

European tech continued its growth in 2020 despite the pandemic, as venture capital carried on investing into the region. The tech ecosystem has expanded to almost $ 1 trillion (€824.4 billion) in combined value, up five-fold from 2016. We now have 115 VC-backed companies valued at over $ 1B (€824.4 million). Moreover, institutional investors from Europe and…

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The Duo Blueprint: How Ann Arbor’s Duo Security is Changing the Midwest Startup Scene

“Our small city of freaks and geeks, fast learners, and team players has been a crucible for startups,” Dug Song, co-founder and general manager of Duo Security at Cisco, said.

Ann Arbor has been a launchpad for cybersecurity startups, the most notable being Duo.

In 2018, Duo, one of the fastest-growing cybersecurity providers in the world, was acquired by Cisco for $ 2.34 billion. Since then, Duo alumni who grew within the company and contributed to its success have gone on to found or spearhead their own cybersecurity startups—CensysBlumiraAaDya Security, to name a few.

We’re diving into this cybersecurity ripple effect and why all roads seem to lead back to Duo.


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Experience and empowerment

Let’s look at Censys: David Adrian, the co-founder at Censys, worked at Duo, and you can find Duo alums across departments there—from engineers and researchers to sales, account executives to HR. Not only that, but Song himself is a member of Censys’s board.

At Blumira, you find similar connections. Blumira’s vice president of operations, and its head of content and product marketing, both formerly worked at Duo, and helped grow the company. Duo’s creative director is also an advisor at Blumira.

AaDya Security, though in Detroit, is another security startup with Duo ties. Raffaele Mautone, the CEO and founder at AaDya, worked as the CIO and VP of Business Operations at Duo for years, and other AaDya leaders have ties that lead back to Duo.

Duo’s leadership team often says that they not only want Duo to be a great place to work, but also a great place to be from. The company has strived to make itself a platform for the careers of many, either by growing within Duo or the Cisco organization, or moving on to lead their own startups. The fact that so many people have put in many years at the company and then progressed in their careers speaks volumes about a culture centered on learning and empowerment that Duo Security fosters for its employees.

“I want to build a platform of opportunity for every person that joins us,” Song said to Infosecurity Magazine. “When I manage, it’s important to me that we understand what people are trying to accomplish in their careers. I think of everyone who comes to Duo as a volunteer—no one has to be here! So the most important thing is to let them innovate and grow.”

And innovate and grow they did.


Related: Bamboo Detroit Co-Founder Shares Tips for Creating an Inspiring Shared Work Culture

Good goes around

Song recognizes the important role the community plays in all this.

“There’s tremendous depth to the community that exists in Ann Arbor,” Song said in a recent interview with the University of Michigan’s LSA Magazine. “There’s a heritage of ideas and organizations here, and Duo is part of that long lineage of people, programs, groups, ideas, and companies.”

He notes organizations like the super-early stage startup community: the Ann Arbor New Tech Meetup. For eight years now, about 6,000 members have been meeting every month, where members of all kinds of tech companies in Ann Arbor come together and talk shop. It’s a nurturing environment.

“Michigan is a really interesting proving ground for innovations that improve people’s daily lives,” Song told Xconomy following Cisco’s acquisition of Duo. “The culture of Michigan is exported in such a big way around the world.”

But there’s no denying the role Duo has played in leading by example when it comes to culture, people and growth. The fact that Duo has created an environment that allows employees to thrive is not only good for Duo and its employees, but it’s also good for the region.

When companies encourage a healthy culture, better business gets done. This helps employees rest, recharge, stay creative and energized to keep producing innovative work.

“No one is in our office after 5 p.m. because they have a life,” Song told a crowd at the 2019 Intermitten Conference. “It’s important to have a life and to have ground rules.”


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Not only that, but when companies build a culture that is open, accepting and allows its employees to be authentic and thrive, it also helps attract more top-tier talent.

Take it from Kendra Mitchell, chief of staff at Duo. At the Diversity and Inclusion Panel, she said, “The reason why I came to Duo was its commitment to people and its commitment to diversity and inclusion and the way that’s centered in its practices.”

And when companies can attract top-tier talent, business grows—and so does the region. More startups like Blumira, AaDya and Censys pop up, creating more jobs and attracting even more talent. Cities grow, more companies open offices here, more talent comes in. It’s a ripple effect.

This is how tech hubs form. It starts with companies and their strong, human-centered foundations.

“It’s exciting to see this next batch of security companies starting up and saying, ‘We want to follow Duo’s blueprint. Not just in terms of the success and growth of the company, but in terms of how we operate,’” Jon Oberheide, co-founder and CTO at Duo Security, recently told U of M’s Engineering Magazine. “That’s what we set out to do: To change the security industry.”


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Amsterdam is a melting pot, yet a new survey says its startup scene isn’t: what needs to change?

Diversity in Amsterdam Igneta Skliaustyte interview

The city of Amsterdam is considered a delightful melting pot of people from all shapes, sizes, colours, sexual orientations, and cultures. Unfortunately, the same can’t be said from its bustling startup ecosystem. The good news is: many startups have taken their first steps towards a more inclusive team, according to a survey from the Dutch Startup Association (DSA). We spoke with StartupAmsterdam’s Talent & Diversity Lead Igneta Skliaustyte about the steps ahead.

First steps to more diversity

One of the main findings of the Diversity and Inclusion report of 2020 [pdf here] by the Dutch Startup Association is that many companies are doing ‘something’ to increase their diversity. 89 Percent of startups have implemented at least one diversity policy. Most frequent policies include having a clear understanding of how diversity is linked to bottom-line performance, using a diverse team to interview candidates and including the value of diversity in the company’s mission.

However, the report also highlights the startup scene in Amsterdam is mostly homogeneous. White men are disproportionally featured in the composition of teams. 62 Per cent of respondents identify as male, 70 per cent as white. Men and white people also hold more equity in companies than women or people with a different cultural background. Together with The Next Women and Young Global People, DSA now launches a Diversity & Inclusion Desk where startups can find advise on changing these dynamics.

‘We miss action from companies’

“I’m a bit disappointed”, says Igneta Skliaustyte about the findings in the report. As Talent & Diversity Lead at StartupAmsterdam, her job is to advise companies on how and where they can find tech diverse tech talent to join their fast-growing teams. “Especially seeing that less than half of the companies answered they do not have an understanding about how diversity relates to business goals and don’t include diversity in their mission statement. We do miss more action from companies in general. However, we should also evaluate whether our methods and the message we are sending as a city is the right one.”

Read also: With female founders receiving hardly any funding, Amsterdam’s push for diversity continues

A good example Skliaustyte and StartupAmsterdam are involved in is the TekkieWorden Week. The week-long programme aims to introduce youngsters of different backgrounds to an education and a job in the tech world. Another initiative StartupAmsterdam is involved in is TechMeUp, which recently started offering an interest-free loan for people to enrol in a tech-related education. Both actions strive to introduce more of the underrepresented demographics into the world of tech. StartupAmsterdam is also building on a new joint initiative with over twenty female organisations called RISE.

The benefits of a diverse team

A vital question tech leaders have when facing the call for more diversity is: what’s in it for the company? According to the report from DSA, ‘there is no general evidence available of increasing a companies’ profit by adding minorities.’ 

Skliaustyte acknowledges for starting companies, the long term investment of increasing diversity may not be of the highest priority. “When you’re only just beginning, your company may not have the financial flexibility to make decisions that seem like an investment. So when deciding who to hire, smaller companies tend to make more quick and safe choices.  They mostly end up hiring men for tech jobs, also because the majority of candidates are men.

So Skliaustyte urges tech leaders not te be discouraged in finding different people for the same job. “I truly believe a diverse team can increase performance and provide better dynamics in the company. More than half of the people in Amsterdam have a migration background. You can’t afford not having them in your team. And everyone brings something new to the culture, something you can learn from with time.”

Protip: check your job postings

Skliaustyte says it is up to the leadership of a company to create the correct mindset and communicate that vision for the team. That might be easier said than done. Because what to do if you put out a job posting, and only white dudes show up? “Maybe I sound a bit harsh, but you might then be targeting the wrong group”, says Skliaustyte. 

For instance, Skliaustyte says that in her experience, from talking to female coders, a job post can already imply it is not a suitable environment for women. “Coders say that sometimes it is already clear from the job posting that a team is not diverse. I know this is a chicken and egg problem, but it can also be about company culture. The way you describe team building and the values your company hold.” 

Recruiters should have this in mind when looking for people outside the usual pool of talent, says Skliaustyte. “They need to try and speak the same language. If you want women or people with a migrant background, you need to incorporate it into your acquisition strategy. Enough is going on in the city for you to find this talent pool.”

To find out what is going on exactly and how your startup can increase its diversity, you can contact the Dutch Startup Association, which has its own Diversity & Inclusion Desk for tips and advise. You can also get in touch with Igneta Skliaustyte at StartupAmsterdam.

Picture: Igneta Skliaustyte, Talent & Diversity Lead StartupAmsterdam

Startups – Silicon Canals

Why you have to pay attention to the Indian startup scene

This is The TechCrunch Exchange, a newsletter that goes out on Saturdays, based on the column of the same name. You can sign up for the email here.

Back in August during Y Combinator’s two-day demo extravaganza, TechCrunch noted a number of startups from India that stood out from the batch. Names like Bikayi (e-commerce tools), Decentro (consumer banking APIs), Farmako Healthcare (digital health records) and MedPiper Technologies (helping hire health professionals) joined our list of favorites from the batch.

Seeing so many India-focused startups in the mix wasn’t a fluke. Data shows that India’s venture capital scene has grown sharply in recent years. 2019 was the country’s biggest ever in terms of venture dollars invested, with Bain counting $ 10 billion during the year.

In 2020, the third quarter brought the country’s venture capital scene back to form. After a somewhat average start to the year, Indian startups saw their venture capital investment fall to just $ 1.5 billion in Q2, the lowest quarterly tally since 2016. But data via KPMG and PitchBook make it plain that Q3 was a rebound, with $ 3.6 billion invested into Indian startups during the three-month period.

That figure was not a historical record, mind; the Q3 total looks to be only the fourth-biggest VC quarter in India’s startup history since at least 2013 and, perhaps, ever. But it was a good bounce-back during a crippling pandemic all the same. The country’s VC deal count also rebounded a bit in the third quarter, with some of that money landing in big chunks, including a $ 500 million investment into Byju’s this September.

Smaller startups are also seeing strong results. Bikayi is one such startup. TechCrunch caught up with the company via email, digging into its post-Demo Day results. Its monthly recurring revenue (MRR) grew 60% in August from its July results, it said. And in late August the company told TechCrunch that it was on track to reach $ 1 million annual recurring revenue (ARR) by the end of the year.

Bikayi said more recently that it recorded 100% growth in the number of merchants it supports, and 100% revenue growth in September. So the WhatsApp-focused Shopify-for-India is racing ahead. October results, Bikayi CEO Sonakshi Nathani added, are looking “promising” as well.

To get a better handle on the Indian startup market more broadly, The Exchange got ahold of Accel investors Arun Mathew (based in the United States), and Prayank Swaroop (based in India), for a bit of digging.

Historically, falling bandwidth and smartphone costs along with improved Internet reliability helped lay the foundation for the recent Indian startup wave, according to Swaroop. Mathew added that some high-profile successes like Flipkart made startups a more attractive option, with the ecommerce company’s success helping to “change the tenor” of the conversation around founding tech firms in recent years.

It also helps, Swaroop added, that seasoned folks from existing Indian tech companies are branching out and starting companies of their own, recycling knowledge into new, smaller companies. This is a key method by which Silicon Valley has managed to create an outsized number of hits over time; a concentration of operators who have built big startups are key grist in the unicorn mill. And there’s more money being raised to help power new Indian tech companies.

All told, 2019 was a huge year for the Indian startup market in venture capital terms, and 2020’s recovery is underway. Let’s see what gets built.

Market Notes

The Exchange spent a lot of this week digging into venture capital data and trends, something that we love to do. If you need to catch up, here’s our look at the U.S. venture capital scene in Q3, and here are our notes on the more global picture. And we touched on India above. What more could there be?

Well, some data on healthcare-focused companies is just what we need. Per a new report from CB Insights, there are 41 healthcare-focused unicorns today. More importantly, startups focused on health-related matters (telemedicine, mental health, AI, etc.) just had a record quarter. Even for a pandemic, $ 21.8 billion went into the space across 1,539 global rounds in the third quarter. That’s far more activity than I would have guessed.

And with that, we’re cutting Market Notes short this week for some important TechCrunch news:

Hey y’all. It’s Megan Rose Dickey busting into Alex’s newsletter for a couple of quick news items. First, I officially launched my newsletter, Human Capital! It covers labor and diversity and inclusion in tech. Also, I relaunched the Mixtape podcast with my colleague Henry Pickavet. You can check out our first episode of Season 3 about California’s gig worker ballot measure Prop 22 here.

Megan is amazing and you should check out her pod and newsletter.

Various and Sundry

As always, there was more good stuff to share here than I can possibly fit, so let’s get right into the data, takes, links and other delicacies.

Wrapping, a survey from Salesforce shows that enterprise cloud CEOs are reporting better-than-anticipated revenue growth and lower-than-anticipated churn, when compared to their March estimates. That is probably why earnings haven’t been a disaster and so many unicorns were able to go public in Q3.

That and valuations in the public sphere are higher than what private investors are dishing up, inverting the market’s last few years.

See you Monday,

Alex

Startups – TechCrunch