21
Aug
12

Why Midtown must be the center of Atlanta’s Startup Community

I recently discussed how Startup Communities are Neighborhoods, Not Cities, building on Brad Feld’s thoughts on the role of “Entrepreneurial Population Density” in accelerating startup activity and success. The SalesLoft team, fresh back from TechStars and Boulder’s vibrant startup community, have been riffing on these topics as well.

The clear truth is that cities with the most effective startup communities are build around physical hubs. Atlanta, consistent with its’ urban sprawl, has attempted to scattershot its startups across the city and drive around and hit meetups to build community, but three potential startup cores have been identified – Buckhead, Westside, and Midtown. I’ve done startups in all three areas, so I can speak with some knowledge on all 3.

Let’s first take a look at criteria that can make a great startup community:

  • Density – Feld suggests that the “total number of entrepreneurs and employees of entrepreneurial companies divided by the total number of all employees in a region” divided by the size of the region. More entrepreneurs surrounded by fewer non-entrepreneurs in a small area gives much more opportunity for intentional and serendipitous events that help startups. Related but separate is:
  • Walkability (within the community) – being close together is more effective if there are reasons and room for people to walk around and meet people beyond just people they have specifically scheduled time with. People often walk to:
  • Meeting Spaces – formal and informal. Free or cheap spaces for small meetings and preferably for larger meetups make it easy to gather people who are just a walk away. Coffee shops, preferably good ones, and affordable, decent restaurants are good for meetings and helpful in recruiting. Some of the people you want to recruit are:
  • College Students – Proximity to young talent can help startups staff up, but proximity to startups can also help students get excited about awesome career options besides larger corporate jobs. Colleges are a home of future founders. Some college kids have cars, some don’t. Either way,
  • Transit and Transportation – are important. Students and many younger potential startup workers prefer to walk, bike or take transit (preferably trains rather than buses). In a city where some people choose to live 45+ minutes from most startup jobs, you can’t please everyone who drives their commute, but the more people who can do a <30 minute commute, the better. Some work can be remote, but before product-market fit, it helps to have good:
  • Work Spaces – Companies need room to start, and room to grow. A variety of office space, preferably creative space, older buildings, higher ceilings is nice. Flexible lease terms are nice, but challenging in a town where few commercial real estate agents understand startups and insist on a 2 year minimum lease. Free space is nice, but startups who will choose free workspace outside of a community rather than paying a few bucks a month for space within a community just don’t understand the value of community. Free and cheap space within a community is best, but in Atlanta, most of our rents are cheap compared to other startup hubs.

So where does this leave Atlanta? Some thoughts based on my experience:

Buckhead is a finance and real estate neighborhood that tolerates startups. The best office space is designed for high-end law firms. Lesser office space is designed for lesser law firms, and still feels oppressive for startups. There are some great companies, solid transit access for intowners and college kids, but a crummy commute for most drivers. Meetings spaces are corporate and overpriced, and ultimately, any startup density is overpowered by those seeking to set up shop in Atlanta’s most prestigious business district. In my 2 years working in Buckhead, even walking to meetings and lunch, I don’t think I ever encountered someone from the startup ecosystem unless I planned it.

Westside oozes cool. I wish I could crown West Midtown as Atlanta’s startup epicenter. I’d save 2 hours a week on my commute, have awesome office space, and enjoy some of Atlanta’s best food at my lunch meetings. This neighborhood is NOT walkable. Not without a concealed carry permit. Apart form being sketchier, there are geographic factors that make density VERY difficult in this area. You could pack most of the office space over here into a single office building in midtown or Buckhead. Octane Coffee might be THE best serendipitously cool meeting spot in town, with great coffee. Transit access is awful. Meeting space for larger meetings is hard to come by without ponying up.

Midtown is anchored by Georgia Tech and ATDC. Some people wish that we could escape from the state-sponsored influences, and while ATDC’s office space is suffocating and sterile, it also concentrates some of the best startup talent in Atlanta, including tentatively acquired BLiNQ Media and $3.75 million funded consumer health care revolutionaries PatientCo, as well as so many other companies I expect, GREAT meetups, and excellent mentors and advisors. Atlanta’s marquis startup accelerator, Flashpoint, is down here. I’ve chosen to run Badgy out of Hypepotamus, one of THE best free working spaces and meetups spots I’ve seen. Georgia Tech students can walk to this area. Whenever I walk to a meeting in this area, I see people, especially at the Tech Square Starbucks. I wish we had better coffee shops with better coffee and without long lines of students, but I truly believe that this would be the best spot in Atlanta for an unfunded, hungry entrepreneur to spend a week working and meeting people. The casual relationships built in this neighborhood, over time, are undeniable.

Thoughts on other areas:

Decatur – driving to Decatur from anywhere else in town is a horrible experience. Game over.

Dunwoody – lots of other businesses, unwalkable, limited student access, and horrible commutes for many

Galleria / Vinings – NO transit, not walkable, very corporate, no students. (I worked here too, LOVED the commute, but it’s not a startup area)

Technology” Park – Undrivable, unwalkable, no students, no meetings, no density. I don’t understand.

Alpharetta – 30-60 minutes from everywhere else in town. Could become a secondary startup core, but we need a first core first.

Old Fourth Ward – MAYBE in 10 years, if Atlanta has the courage to build comprehensive rail around the Beltline

This analysis is ALL about finding the best advantage for young startups that need every advantage they can find. Proximity to knowledge, resources, and people is a MASSIVE advantage. Startups that have found product-market fit often relocate outside of the core startup neighborhoods, and that’s fine and expected.

So what do you think is the best neighborhood for Atlanta startups to rally in and thrive? Why? What criteria did I miss?

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28 Responses to “Why Midtown must be the center of Atlanta’s Startup Community”


  1. 1 stephenfleming
    August 21, 2012 at 1:49 am

    Great post. As a Midtowner, I’m naturally biased in favor of your answer, but I also think you are right: Midtown now, with Alpharetta as an emerging second core.

    I’m seriously interested in how we can make the ATDC spaces less “suffocating and sterile”… without spending any money. If it’s free or (very) cheap, we’re listening!

    • August 21, 2012 at 8:54 am

      stephen – I’d say the best way to start doing that is to take a look at other spaces that are less suffocating and sterile. Flashpoint and Hypepotamus come to mind. Or you could look at ScoutMob’s office. I’m sure there are plenty of other good examples too. Mostly I think it comes down to an environment that is open and relaxed – and has plenty of spaces for congregating and meeting. Whiteboards. Not cube farms. That being said – I’ve only visited ATDC, not worked there – so would rather hear from others with actual work experience in that space.

    • August 23, 2012 at 12:15 am

      Stephen – one thought on Alpharetta. To really thrive, they need to decide what their “neighborhood” is. Alpharetta is a city defined by its highway exits. Even if you said their core would be Windward Parkway, it’s a road of office parks. Not walkable and low serendipity.

      For ATDC, I’ve often heard from companies in the space that there’s a significant culture difference between the grant-centric GT IP companies with significant professor involvement and the less academic companies. I wonder if there’s a better way to put birds of a feather together? Past that… I wonder if there’s a nice way to yank the ceiling tiles and get some of the daylight from the outside offices into the halls?

    • 4 lanceweatherby
      August 23, 2012 at 12:26 am

      One thing I have learned over the last 90 days or so is that demolition is cheap. Remove the doors, blow out some walls, remove the ceiling tiles, pull up the carpet.

      Not sure if any of that really matters. The hub is the people not the interior design. Fifth and Spring is startup central in Atlanta. I believe that is Rob’s whole point.

      Gather around it.

  2. August 21, 2012 at 6:29 am

    “Atlanta, consistent with its’ urban sprawl, has attempted to scattershot its startups across the city”. Is there some commission that determines where startups locate? There is no monolithic “Atlanta.” Startup hubs are created as a result of the decisions of hundreds of individual entrepreneurs who decide where to locate their business.

    The reality is people will locate their startups close to where they live. And, for most, they choose to live in the suburbs. While some might desire a dense center for startup activity, it is unrealistic in my opinion.

  3. August 21, 2012 at 7:06 am

    I agree Midtown will be the spot, but only if enough office space is available to support a vibrant community. Ga Tech, Flashpoint, ATDC and now Hypepotomus are all good anchors. It’s hard enough to get a start-up off the ground Anywhere in the ATL but where do you go from there? Let’s not just grow but keep start-ups in midtown instead of losing them to Buckhead, the burbs, Boulder, NYC, etc.

    • August 23, 2012 at 12:17 am

      Do you see a shortage of office space? ATDC seems to have cleared out a lot of space recently, the ERC is free and usually under-utilized, and I know there’s still space open in 730 Peachtree and the Biltmore. People are moving to the burbs over $5/sq ft/year. Penny wise, pound foolish.

  4. August 21, 2012 at 9:00 am

    I’ve always thought about spending some time in Hypepotamus for work. I currently work in a Buckhead office trying to build a digital practice in a very traditional PR firm. Being that it’s a few blocks from home, it may be a good change of brain pace to just be an environment of digitally-focused minds from time to time.

    • August 21, 2012 at 9:41 am

      Couldn’t agree more Rob – locating in Midtown increases a startup’s exposure to positive serendipity e.g. good luck. While we look at the startup ecosystem and focus primarily on the nodes in the graph, I think the edges between the nodes are far more important and is where profit (however you define it) is created.

    • August 23, 2012 at 12:19 am

      Drew, come on down. Would love to hear about what you’re up to, and there are usually a few startups in the space that could make your day interesting.

  5. 12 John Davidson
    August 21, 2012 at 9:42 am

    I love this topic and am glad you have spent time on it, Rob. There’s no doubt that Midtown is the hub and likely will continue to hold that status. Some other thoughts:

    1. It’s anchoring startups beyond the incubator stage that worries me most. I think the ATL is doing a reasonable job nurturing startups and bootstrapping. But as companies grow (and actually are self sustaining) the commuting pressure rises accordingly because the public education/family housing option in Midtown and surrounding areas leaves a lot to be desired.

    2. There’s limited student access (compared to the environs of GTech) in Sandy Springs but I’d say there’s opportunity there, especially given the population density, cost of living/leasing, access to transit, low crime, excellent schools–things that make it more of a stable, longterm bet for post-incubators than anywhere intown. But there don’t seem to be any seeds planted in Sandy Springs…

    3. As much as I think college students are vital (if not essential) to the scene, who would have ever imagined Boulder as a target for startups? It’s certainly not based on the tech degrees coming out of the local state university. Boulder is a lifestyle destination city for people who either love the outdoors or people aspiring to the outdoors. Despite being in between coasts, it’s a remote city. Take away the scenery and that town doesn’t rise as a tech hub, right? But that’s kind of the point: Feld and a few other leaders have turned that town into a beacon and capitalized on its physical attributes. No one imagined Athens as a music town in the 70s but that’s what it became in 80s and 90s.

    4. Similar to a vibrant music scene, there’s a bit of a hipster-cognoscenti tech atmosphere that seems to drive hub growth. And in the ATL, I think you have to have that in order to attract and nurture young talent. This more than anything sort of makes the northern suburbs (and even Buckhead) also-rans.

    • August 23, 2012 at 12:26 am

      When companies start to scale, they can move most places within a metro area. They have their business model, are executing, and need less serendipity. Facebook, Google, and Apple campuses are not walkable from other startups. ISS landed in Sandy Springs/Dunwoody, and it makes sense. The earlier the company, the more serendipity is needed.

      There are a LOT of workable places to live within 20-30 minutes of midtown. I don’t disagree that schooling is tough… but like many founders, our family is a bit contrarian and we’re weighing approaches to not be victims of the failures of local school systems.

  6. August 21, 2012 at 10:17 am

    If we want entrepreneurs to create more startups in midtown, we need to find a way to entice them to live here. The two biggest problems in my opinion, that I am hoping Atlanta gets serious about, are crime and quality of public schools. Using the example above, Boulder has a crime rate below the national average, while Atlanta’s is more than double. The three high schools closest to downtown Boulder have a GreatSchools rating of 7, 9 and 10. The four high schools closest to Midtown have a rating of 7, 5, 4 and 4.

    If we do not address those problems, then at best we can create a “community” of commuter-entrepreneurs, like we have now, but that is far less than ideal.

    • August 23, 2012 at 12:37 am

      The 3 high schools in San Francisco closest to SoMa are 1, 3, and 5 on GreatSchools. Given their proximity to the Tenderloin, crime can’t be low. High Schools near Union Square in New York are 3, 5, and 5. Crime is probably also not low. By these measures, I suspect Atlanta has a superior urban core for families. Why should these factors hold Atlanta back more than other startup hubs?

    • 16 lanceweatherby
      August 23, 2012 at 12:55 am

      I am by no means a defender of the Atlanta Public School system. They pay their administrators too much resulting in high per student tax burdens. They focus on test scores at all costs resulting in scandal.

      But to look at the results of the school system via some online school rating poll does not accurately reflect what is transpiring. Both of my children attend intown public schools. The schools are quite diverse. The way the schools teaches it students is also quite diverse based on ability, dedication, and skills. I anticipate that both Kate and Jack will graduate from high school with far more knowledge than I possessed at that juncture in my life and have more upper educational avenues open to them.

      To say the quality of public schools is an issue within the city of Atlanta is based on lack of knowledge of what is really happening on the ground. Well educated involved parents are making a big difference in Atlanta public schools in my corner of the neighborhood.

      Someday I might be one of them.

  7. 17 Shan
    August 22, 2012 at 12:14 pm

    Right on – that’s how Austin took off – university town (research, expertise, students), several anchor tech companies (Dell, AMD, Motorola), eclectic/creative environment (the music scene), state funding, and critical mass within walking or biking distance of the city center (not so much these days).

  8. August 23, 2012 at 7:20 am

    There is much that Atlanta could learn from the City of Boston and the Innovation District that was created in a part of that City that had nothing and is now becoming the hottest part of town – http://www.innovationdistrict.org. It is a great example of how government can make a difference and really make a positive impact on the success of business.

  9. August 23, 2012 at 8:29 am

    I’d first like to put my vote in for O4W out of strict bias for it being the neighborhood I live in. :) It also has some interesting space at Stove Works and Edgewood is exploding. There is an awesome 4,000 sf raw space on the 2nd floor at the corner of Edgewood and Boulevard that would be fantastic (except for parking).

    That being said, it’s not extraordinarily close to a MARTA stop and I can understand the trepidation of some entrepreneur’s to come into this neighborhood… especially OTP’ers. I have found a good/cheap space in Inman Park if anyone’s interested.

    On the broader picture, I think midtown is a great location for all of the reasons listed in this post. I would like to see space that allows for different modes of working, though. Many people work well in a big, open space – I work in coffee shops sometime, for example. However, some people work best when they can have their own nook for deep focused coding or remote meetings… I need that on occasion as well.

    I really like the setup General Assembly has in NYC. Most of it is open, but they have nooks and crannies as well. Ponce City Market comes to mind as a location that could have a lot of potential, although is not as centrally located as Midtown.

    The density of Midtown and the amount of entrepreneurial activity that already revolves around it makes the most sense to me as an Atlanta hub. It seems like more of the entrepreneurs I run into are from intown and the ones from further out might be from Alpharetta, Marietta, Peachtree City, Duluth, etc. For them, midtown could be the central point that everyone could agree on.

  10. August 24, 2012 at 2:20 pm

    Good post, I think that the second center will west midtown once the crime is addressed. The eventual core will span W. Midtown through Tech and Midtown with all areas having great perks for startups.

  11. August 27, 2012 at 4:46 pm

    Boston’s Innovation District is hyped, but only because the city is spending so much money on it. Founders are highly ambivalent to it – some hear good things from friends out there, others have free space through Mass Challenge. Having just moved down from Boston, I found it to be a ridiculous waste of tax money to try and get people to work in a part of town with no infrastructure, but perhaps this is how parts of a city are redeveloped.

    From my experience, Atlanta really needs a CIC (http://www.cictr.com/ – you’ll have to excuse the awful web page and poorly produced videos). CIC provides spaces from co-working to 100 employees, with shared kitchens throughout. A company can grow from co-workers (C3) to startup accelerator (C4) or venture capital (Critical Mass) co-founders to 5 employees and 50 employees without changing buildings. It\’s a great place to meet like minded people through shared spaces (kitchens), weekly networking events (VentureCafe), showcases and mailing lists.

    In the end, I think that community discoverability is the biggest problem. It leads people to never start, give up early, or move to somewhere from which they have heard of startups succeeding.

    • August 27, 2012 at 9:58 pm

      So this sounds like Atlanta’s ATDC (http://atdc.org/) – space starts with “seedspace” suitable for 1-4 people, and can scale up to at least 40-50 people, all within a few floors in the heart of midtown. The space is a bit dry and sterile, but still attracts many companies, mentors, and meetups, all right on the edge of Georgia Tech’s campus.

      • August 27, 2012 at 11:31 pm

        The SeedSpace is structurally similar, but not the same. First, it sounds small compared to the 10 floors of CIC. Ideally the space would occupy all of the Centergy building. Second, it’s curated by ATDC, and that will keep the right kind of people out. CIC is office space, plain and simple. You give them money, they give you office space. When I was planning to move down, I found (not easily) the page for SeedSpace, saw the pricing and… “Find out more at office hours.” I guess that isn’t bad. Office hours require me to be an active ATDC member? Fine, hoops… To apply I have to “[Have a] novel or unique approaches to leveraging technology for business”? And “As a result of using technology, employs a large number of technologists”? This is nonsense, I’m trying to work. Off to Strongbox West or Ignition Alley. Strongbox West is refined and professional… not exactly what I was looking for. Ignition Alley seems more hacker oriented, but empty on the day that I showed up.

        The best technical networking experience that I’ve had so far is (and has been since I left Atlanta 6 years ago) Octane Coffee. When I approach the door, no one asks whether I am advancing technical innovation in Georgia, but they will serve me a world class espresso. The table behind me demos a polished iPhone app for pass through augmented reality content replacement to some potential clients who seem impressed. The guy sitting next to me is writing an experimental CPU driver. A couple hours later two guys discuss funding a new startup accelerator. Neither dry nor sterile.

        It doesn’t matter how many people potentially fit in the pot, no Seed is going to grow in “a bit dry and sterile”.

      • August 28, 2012 at 7:15 am

        So yes, it is small. And yes, it’s lightly curated, thought the bar is quite low at this point.

        These days, Badgy is working out of Hypepotamus – a shared working space on Tech Square with no requirements, no ceremony, still in the thick of things. I think there’s plenty of space for startups of any size in this immediate vicinity. The prime obstacle space-wise is really commercial real estate brokers who don’t understand that a minimum 2-year lease is just not practical for startups. So we have entire floors of midtown buildings sitting vacant for years while willing tenants walk past and set up shop in Sandy Springs.

      • August 28, 2012 at 11:05 am

        The point of CIC is to insulate startups from commercial real estate requirements. If someone were to create an analog in midtown, that company would have the two year commitment on the space with the option to sublet. Then, just like the ATDC space, startups would have month long commitments to the middleman. With small enough physical divisions, startups can keep costs low even while paying a premium per square foot. The middle company is run as a profitable business, and everyone is happy. The only difference between this idea and ATDC’s space is the middleman’s charter. I am not familiar with commercial real estate in midtown, but if it’s true that there are empty floors, and it’s true that folks are setting up in Sandy Springs due to commitment requirements, then this seems like a no brainer.


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