Mar 17, 2022 - Business

Atlanta's tech unicorns and the state of the ecosystem

Illustration of a unicorn statue on top of a stack of cash.
Illustration: Aïda Amer/Axios

Atlanta’s tech ecosystem is coming into its own. The talent flowing out of such schools as Georgia Tech, Morehouse, Emory and Spelman has enticed legacy tech companies including Microsoft, Facebook, Airbnb and, just this week, Capitol One and Walmart to open offices here.

Driving the news: And the startup ecosystem is seeing results. Recently, Atlanta has had a steady stream of young companies reach “unicorn” status, or a valuation over $1 billion.

Some of Atlanta’s recent unicorns:

  • Flock Safety: The company, based on the Westside, makes machine learning-backed public safety surveillance systems. It reached unicorn status last summer and is now worth $3.5 billion.
  • Salesloft: This Midtown startup sells sales software and surpassed a $1 billion valuation early last year.
  • Greenlight: The fintech startup based downtown, focused on monitoring children’s spending through debit cards for kids, reached unicorn status in 2020 and nearly doubled its valuation last summer.
  • STORD: The Midtown supply chain software company passed a $1 billion valuation last fall.
  • FullStory: Headquartered near Brookwood Hills, this homegrown company focused on digital customer experience hit the $1 billion mark last summer.

Yes, but: Emil Moffatt, a reporter at WABE News, who recently launched an Atlanta tech-focused podcast called the WABE Tech Cast, said the new giants create a problem for the startups: “Where does that leave the smaller companies in trying to recruit talent?”

The intrigue: According to Sanjay Parekh, an Atlanta entrepreneur and investor, something that differentiates the city’s startups is their variety of industries.

  • “If you look at a lot of other cities, I don’t know that they are as diversified as Atlanta is across so many different verticals,” he tells Axios.

Atlanta is also unique for its ecosystem of Black entrepreneurs and investors.

  • According to Fast Company Atlanta’s tech industry employees are 25% Black, versus 6% in San Francisco.
  • That’s thanks to the city’s HBCU community, the reverse great migration of Black talent to Atlanta, and conscious investment in Black-owned startups by big names like Mike Ross and Paul Judge.

State of play: One sign of the ecosystem’s maturity, Parekh said, is the flow of money coming to startups. He said investment and venture capital firms have set up shop in the city and big investors regularly come to town.

  • While that’s true over time, Moffatt said startups, especially those owned by underrepresented groups and women, still complain about the need for additional access to capital. “It’s getting better…but it’s still a work in progress,” he said.

What’s next: Parekh said one challenge the industry is facing is how to tell its story to better attract employees, customers and outside money. Because the metro area is so fragmented, he said, it’s difficult to track and promote all that’s going on.

  • That, he said is “probably the biggest thing that if we can fix in the next couple of years that will really propel the community.”
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