Miami isn't just nightclubs and beaches.
As with so many other phenomena that occur within the U.S. tech community, it should be no surprise that the rise and fall of the next great tech city should be determined through hype.
One could say that investors and VCs in Miami willed Miami, the newest U.S. tech hub, into existence, purely by deploying one of venture capital’s oldest tactics: FOMO.*
*fear of missing out - footnote for those who don't know.
Toward the end of 2020, at the height of the COVID-19 pandemic and amid a surge of hospitalizations around the world, longtime venture capitalists and investors started to become disillusioned with life in the two coastal cities that dominated the tech world for the past decade: Silicon Valley and NYC.
There is more to the story than just optics, though. In the past five years, there has been a steady push by Florida politicians—particularly Miami Mayor Francis Suarez—to jumpstart the state’s most famous city into a flashy new tech hub, one that revitalizes a tourism-dependent state economy and rivals the tech big leagues of Silicon Valley and New York City.
This put into motion a backbone for a new venture capital ecosystem to emerge along the southern East Coast. With the help of high-profile VCs like Keith Rabois and Jack Abraham, who moved to the sunshine state the previous year to invest in new opportunities, a had-to-be there, in-person networking spree started to form.
In April 2021, amid an influx of Americans getting vaccines and cities and businesses reopening, the impromptu “Miami Tech Week" kicked off. Investors in the area called up their network telling them to come to what some were referring to as “South by Southeast.” Hundreds of hungry entrepreneurs and curious VCs flocked down south for a week of mayoral speeches, happy hours and parties that lasted into the night.
Delian Asparouhov, a principal partner at Founders Fund, was one of many VCs to jump on the bandwagon to fly down for the unofficial event. He tweeted on April 25, 2021, “I know at least 100 founders, VCs all flying in” for what he described as the “inaugural tech event.”
The event was such a success it sparked an official event called Miami Tech Week Conference that ran in April 2022. It was organized in collaboration with VCs and local politicians and sponsored by tech companies like Coinbase and Eight. A one-day-only, ticketed event that tipped off the week with speakers followed by conferences, community events, parties, happy hours and more.
It’s too soon to say if Miami has solidified its place as the next biggest tech city. And besides, there are other American cities with faster-growing technology sectors like Austin or Boston.
These cities also have a steady talent pipeline from multiple established and renowned universities feeding their ecosystem, something Miami lacks. And currently, the only company founded in the Miami region with a market capitalization of over $10 billion is Chewy (bought by PetSmart in 2017 for $3.35 billion.)
However many odds may be stacked against Miami, a handful of VCs (and newly minted Miami residents) would like to think otherwise. Check out two of the major forces in venture capital trying to turn the technology tide down south.