01
Mar
13

Atlanta: The Unsurprising Home of the $200 Million Series A

The big news over the weekend was Atlanta’s own Mobile Device Management startup, Airwatch, raising $200 million in its’ first institutional round of funding. That’s an eye-popping Series A round in any market, and no fluke from a founding team that built Manhattan Associates into a public company. Atlanta has enough of the right ingredients for startup success that our near absence of institutional investors spawns startups with the survivability of cockroaches, undaunted by the nuclear apocalypse of the “Series A Crunch”, fed by a steady diet of customer revenue. Georgia’s the regional, national, and international headquarters of many a company, and the crumbs in their budget are meaningful meals for growing, scrappy startups in businesses that many would ignore as “unsexy”.

It’s been pointed out that Atlanta isn’t one of the top ten startup markets, but this is a flaw of measuring only the measurable. When you measure with investment dollars in funding rounds, you don’t count companies like Pardot, that sell for $100 million with NO outside funding. When you only count exits, you miss companies like MailChimp, fully bootstrapped and potentially worth over $1 billion. How do you financially measure a MailChimp?

We have three email marketing startups (possibly four) that send over 3 billion emails per month each. Only ONE of them (Silverpop) has taken measurable outside funding.

Spanx is private with no outside funding, probably worth > $1 billion. InComm has massive market share in the HUGE market of physical and digital gift cards – private with no investors and immensely valuable. I can’t find definitive details, but it certainly appears that Radiant Systems built their business with no reported investments, possibly some strategic investors. Cloud Sherpas leapt to an impressive $40 million Series B after 2 prior rounds that would qualify only as “seed rounds” elsewhere.

This pattern is both nature and nurture. With limited seed capital and even more limited venture capital, many viable Atlanta startups reach sustainability before they ever encounter an interested, appropriate investor. A $200 million Series A isn’t shocking, because it’s been preceded by 8-figure Series A & B rounds, 9-figure acquisitions of bootstrapped startups, and $1 billion+ companies build without outside funding.

And there are fresh, silent, killer startups rising through the ranks in Atlanta. Some have funding, some don’t, few have the sizzle and press of their peers in the top 2 markets. If you’re one of these startups, make some noise along the way – some of our low profile happens because we just don’t seem to know how to highlight our wins along the way. If you’re on the sidelines admiring startups from the “safety” of a corporate job, make the sacrifices to get in the game – big things are happening. If you’re an out of town investor, make like 500 Startups’ Paul Singh and find the hidden gems of Atlanta companies that you can move the needle on. They’re here.

And don’t be surprised when the next few 8 or 9 figure Series A rounds drop in Atlanta. Those companies are here and growing like southern Kudzu, taking over, whether or not you help them.

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1 Response to “Atlanta: The Unsurprising Home of the $200 Million Series A”


  1. March 1, 2013 at 10:37 am

    Great article, Rob. It seems that whenever a story is written about Atlanta, they only get a fraction of the picture. Part of that is that people fly below the radar, focusing on their customers. Some of it is because startups don’t do a good job of communicating as a group.

    I’ve seen multiple articles reference how many startups are founded (or funded) in Atlanta based off AngelList or CrunchBase. Startups in Atlanta may not be able to share all the details of their funding, but it’d be great to see more startups fill out a page in both of those databases. Sure, it’s not an ideal measurement tool, but it is what is being used in the press and using them more would raise the amount of national recognition to the amount that Atlanta deserves. I’d encourage all Atlanta startups to make sure their profiles in both of these databases are up to date.

    Atlanta is one of the best places in the country to build a company. More and more people will realize that as time goes on. For now, the best thing we can do is continue to build companies laser focused on customers.


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