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Miami: The Next TECH Hub

Ines Hegedus-Garcia
ines@miamism.com

It's not just the word on the street, it's a fact!! Major tech players are moving to Miami from Silicon Valley and who would blame them?  No state taxes, the best weather in the world and much more favorable real estate environment.  In addition to that, our brain power and educational resources have been improving throughout the years and we happen to be the bridge to South America and their tech. It's a WIN-WIN! 

I participated in a Clubhouse conversation this past week about tech in different parts of the country and was bombarded by questions from tech players about what is going on in Miami and why things have become more favorable.  We can definitely blame the pandemic for accelerating the process, but nothing like having a pro-business atmosphere toppled by everything else that makes Miami amazing.

I've been putting a list of resources together with all the TECH news from the last couple of months but first, I take off my virtual hat to Mayor Francis Suarez who is a standup guy always looking for Miami's best interest and becoming a crazy Twitter Machine!  (Here's a photo of Mayor Suarez and Miami REALTOR leadership in 2020, right before Super Bowl LIV with THE MIAMI LETTERS)

Is Miami The Next Silicon Valley?

A study by moveBuddha shows all kinds of interesting stats:

Moving from Silicon Valley to Miami has become a hot discussion on Twitter, with some prominent venture capitalists leading the way. We analyzed the data to find out how real this movement is, and found some surprising results.

Led by an unlikely partnership between top venture capitalist Keith Rabois and Miami mayor Francis Suarez, Miami has become the latest city to grab headlines as the next big tech hub.

Is the great Miami migration an over-hyped story driven by the echo chamber of tech Twitter, or the beginning of a long-term trend that will put one of  America’s leading Latin American cultural hubs on the startup map?

Key Findings from moveBuddha revealed the following:

  • In an analysis 42,666 Tweets, we found a 129% increase in mentions of moving to Miami in December 2020 – January 2021 vs the previous year.
  • There were 40% more moves to Miami than out of Miami in 2020.
  • 2.3x more people moved out of the San Francisco Bay Area in 2020 than moved in.
  • San Francisco was the 2nd most common source of moves to Miami after New York City, which represented 30% of all Miami-bound moves.

Why Miami Is The Next Hot Tech Hub: ‘This Is Not A Retirement Decision’

Crunchbase News writes that as more entrepreneurs and investors are relocating from traditional tech hubs to emerging startup ecosystems, and Miami—with its tropical climate, diverse population and lack of state income tax—has suddenly become a tech hot spot. 

Although we acknowledge that we are not "Silicon Valley" and Miami may not even be the 2nd option, we are up there, going head to head with Texas..  

While Miami has drawn tech investors and founders for years, the COVID-19 pandemic seemed to accelerate the rate of migration, according to Rebecca Danta, managing director of angel network Miami Angels. In the fourth quarter of 2020, the influx was like a “big wave,” she said.

Miami's Tech Startup Scene Gets Hotter

According to Inc.com:

Miami boosters have long pushed the Magic City as the next tech startup hub. Now, a year into the Covid-19 era, their pitch has gained greater appeal, given the widespread embrace of remote work and newfound appreciation for outdoor living spaces. Of course, the friendly tax climate--Florida has no personal income taxes--and the mild winter weather have long drawn newcomers, as have its enviable position as a gateway to Latin America and its glittering nightlife. Now, a number of high-profile arrivals are driving new excitement about Miami's startup ecosystem.

What has people talking:  Moves like Blackstone Group, Goldman Sachs, Keith Rabois (general partner at Founders Fund), Jonathan Oringer (founder of Shutterstock).  But I love a quote in that article by Maria Dominguez, site director of CIC Miami, a coworking, laboratory, entrepreneurial space:

"Miami looks like what most cities will look like in the next five to 10 years," Buchanan says. "If you're building a company for the future, the future of America is in Miami." 

Tech flight: Why Silicon Valley is heading to Miami and Austin, Texas

NBC News reports that the desire for cheaper expenses and to avoid costly local laws, drives business relocations to Miami.  Miami Mayor, Francis Suarez is trying to convince Silicon Valley executives that Miami promises a more business-friendly environment.  And it's not just about his twitter charm, he also named the city's first chief technology officer in order to provide "concierge services" like streamlining bureaucratic procedures for high-tech firms when they come to Miami.

“There’s no secret sauce other than my Twitter account,” Suarez said while shaving and preparing for another day of messages from inquiring tech executives. “There is absolutely no doubt that a big part of the reason why they are moving is that they feel that there is an inhospitable environment for regulation and taxation.”

While Silicon Valley is by no means ceasing to be the center of the technology industry, there is an undeniable migration afoot for some of Silicon Valley’s elite to cities like Miami: Reddit co-founder Alexis Ohanian moved from San Francisco in 2017. A year later, Shervin Pishevar, a venture capitalist, bought a house in Miami Beach in 2018. In late 2020, Jonathan Oringer, who founded Shutterstock and became an investor, moved to Miami, as did other notable venture capitalists, including Keith Rabois and David Blumberg.

Silicon Valley exiles are seizing on Miami. Local techies are holding their breath.

The Miami Herald gives a great perspective from the longstanding tech community and their lifelong efforts to boost the city:

“It’s exciting to see folks recognize Miami as a great place to live and do business, especially as it relates to venture and tech,” said Raul Moas, Miami program director at the Knight Foundation, via text. “A lot of people have been building up this community — the tech community and Miami as a whole — for years, and today we’re seeing the fruits of that labor manifest. Much remains to be done and this is a long journey, but it’s important that others see the same potential and promise in Miami which we have for years and take up the flag to build alongside us.”

But my favorite quote is from Shutterstock founder, Jon Oringer, who moved to Miami recently and plans to launch a new group, Pareto Holdings, that will incubate businesses in Miami:

“It’s an up-and-coming tech scene,” Oringer said. “Our sweet spot is starting companies from absolutely nothing, and Miami has exactly that — it’s having a ‘zero to one’ moment. And along with the mayor’s support, it’s a perfect time to start businesses here.”

Even The New York Times is chiming in:

As tech leaders have decamped from San Francisco and Wall Street titans from New York, many have spread across the country to locations with sun, lower taxes and — preferably — more relaxed lockdowns. Coming from places run by progressive governments that were sometimes openly antagonistic toward local elites, many were thrilled to move to towns that seemed to want them more.

Some chose Austin, Texas. Others gravitated to Boulder, Colo. But perhaps the most vocal faction came to Miami.

Miami Is Rising As A Tech Hub, With Some Surprising Help

One interesting story comes from Forbes, published at the end of 2019 (pre-pandemic).  Miami hosted a startup conference with non other than Pitbull, a push to become a global startup hub centered on Latin America and focusing on the strength of an immigrant city. Never would they have imagined the pandemic ahead and what that would mean to Miami's TECH.

The Miami Tech Scene Is Heating Up

And lastly, TechCrunch points out the obvious, Miami as a city of "many traits", recognized by sun, beach and tourists, but having much more than that. 

One of the most diverse populations in the country, Miami is the strategic capital of the Americas, binding Brazil and Spanish-speaking Latin America (LatAm) to the U.S. market.

It gives some pictorial history on Miami's tech evolution, reasons for growth and fantastic stats and ends with a phenomenal quote:

Whoever has tried surfing at any point in their lives know something very well: There is, indeed, a right time to catch a good wave. It is certainly not at its peak; rather, it takes a bit of paddling and vision to catch the best waves and enjoy the ride.

If you are considering catching that "wave", please contact us for your real estate needs.  We don't just have a pretty blog, we make money from helping clients buy and sell real estate. CALL US!

first pub 2/11/2021

 


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