Where Minorities are the Majority: A Tale of Two Tech Cities
Sunil Sharma, Managing Director & Barry Givens, Manager Partner @ Techstars
Ascent Conference 2019
Sunil Sharma [00:00:07] Welcome. So my name is Sunil Sharma. This is Barry Given’s. We’re colleagues together. We both run TechStars accelerators. I run it in Toronto, Canada. Barry is in Atlanta, Georgia. So when we came up with this idea to do a talk together, one thing really struck us is that is that both of our cities are thriving, fast rising tech hubs, highly acclaimed, creating a lot of investor interest and captivating the minds and spirits of entrepreneurs around the world. And in both cases were fueled, I think, by one common characteristic, and that is that we are we are cities where minority populations actually make up the majority of the domestic population or the municipal population of the two cities. So just before we get into that a little bit, I just want to quickly tell you about TechStars. So TechStars is the worldwide network that helps entrepreneurs succeed. We operate tech accelerators throughout the world more than 50 and counting. And so the TechStars Toronto program and the TechStars Atlanta Accelerator are both open for applications right now. So we’re here at a center in part to meet with you and really see and discover some amazing entrepreneurial talent from anywhere in the world and encourage you to apply to to TechStars. So I’ll I’ll pause and let Barry introduce himself a little bit.
Barry Givens [00:01:29] In a quick plug for we got TechStars Chicago in the back of the room, as will. Their applications are open as we speak in both of our applications close on the 13th. 14TH, 13th, so, yeah, so if you’re interested, please go apply. So thanks for the brief introduction. As you mentioned, I’m from Atlanta and I’m a recovering founder. I started a company back in 2012 when there was no ecosystem in Atlanta. I would say no ecosystem. It was it was up and coming and then sold my company in 2017. I’ve spent the last two years before coming on to TechStars is really trying to close that gap, particularly for African-American founders, making sure that where I ended will be where they started.
Sunil Sharma [00:02:16] Right. And so and my background as well in tech investing was a partner at a seed stage fund up in Canada called Extreme Venture Partners before encouraging tech startups to launch in Canada. Now, we actually have three programs. The one that I’m managing director of is a city program. So it’s open to any vertical. And Barry’s is a corporate program. But but ultimately we were exact same thing. We’re looking for an enormously high potential entrepreneurs and really helping them through a combination of mentorship and network ecosystem facilitation, of course, some capital and just kind of our commitment to work and grow with these founders over the course of their entire startup journey. I’ll just say about Toronto. So, you know, it’s exciting for us in Canada to to really be witness to a growth of a domestic tech industry. And I think, you know, the numbers are proving it out. So Toronto is one of the fastest growing tech hubs in the world. It’s now the fastest growing in North America. There have been more tech jobs created in the last two years in Toronto than in any tech city in North America. And that includes Silicon Valley. So it’s it’s an incredibly fast growing market. It’s the fourth largest city in North America. So just behind, you know, Mexico City, New York, L.A., bigger than Chicago and at roughly the same, roughly on par with Atlanta. And I think that one of the reasons why we’re seeing the growth in tech is that our economy and our country has been fueled by immigration. And so we are a country of immigrants. There have been some advantages to immigration policy that you see in Canada that you don’t see everywhere else in the world, including, I would say, from this country. And and so that’s inspiring a lot of people to apply into programs like the Startup Visa or other fast track programs that bring in tech talent that can quickly lead to permanent residency. So one such program is called the Startup Visa, and that’s a program that I had been have been involved with since the very beginning. And it allows for a founder team of up to five co-founders once selected by a designated investor like like a TechStars Toronto to get fast track permanent residency to Canada almost almost immediately. And so that’s what you would call a green card. So it’s not contingent on the startup or on the success of the company, but it’s really the fact that we’ve made a bet on you as an entrepreneur. And so the country should stand behind you long term and you’ll be there to create jobs. So that type of diversity is great. That’s immigrant fueled diversity. But what I want Barry now to discuss a little bit is other types of diversity and essentially the incredible racial and ethnic diversity that you find in Atlanta.
Barry Givens [00:04:57] Yeah, so Atlanta is regularly known as the the black Mecca. But beyond the title, we have a thriving similar to Toronto. We have a thriving entrepreneurial and business community. We have 16 of the Fortune 500. And we look at our population size, the cities that are above us, almost double in population. So from a density perspective, having 16, Fortune 500 is another 11. When you go to Fortune 1000, we have this unique opportunity to not only grow with all the education that we have there from the top bcuz at Morehouse, Spelman, Clark, the Georgia takes the Emory’s Georgia state. But one thing about all of these education systems is they all have this component around African-American education. So Georgia State is actually the number one, number one and graduating African-American undergraduate degrees. You have Morehouse and Spelman and Clark, some of the top schools in the country bcuz are historically black colleges and universities, if you’re not familiar. And then we have Georgia Tech, which graduates the highest number of African-American engineers outside of computer science. And so all that leads to we then have this corporate world where there’s a bunch of money. These companies are doing almost a true close to a trillion dollars in revenue a year. And we’re starting to see these merges with the tech ecosystem in Atlanta as well. And then another interesting fact is these corporations, if you look at the engineers and other major hubs for technology, the percentage of African-Americans in these companies from a tech perspective is typically, you know. Silicon Valley’s like two and a half percent, you get up to, like, I think New York maybe a little higher, like seven percent. Oh, almost 30 percent of the tech workers in the city of Atlanta are African-American, and so it leads to kind of this melting pot of innovation that also rolls over into the culture that we have. And that’s kind of the secret sauce that we have in Atlanta. So Atlanta is the only place where you have African-Americans leading in politics. So we have an African-American woman as the mayor. We also have many African-Americans sitting in leadership positions in those Fortune 500 companies. And then we also have a ton of African-American startups that’s really fueling the need or the desire for the I’s and the ludicrousness and, you know, the Tracee Ellis, Ross, all these people to want to get involved in tech because it finally looks like them and it finally represents things that they want to get involved with in solving problems that typically they would just get into tech for money. But now they’re getting into it because it’s solving things that they deal with, that they grew up, problems they grew up with. So it just is really interesting ability for us to grow the tech ecosystem, but with another culture in mind.
Sunil Sharma [00:07:58] So, so many interesting points to just draw parallels to. I mean, so I learned through the chats with you a lot more about Morehouse. And I’ve certainly known that Georgia Tech is an engineering powerhouse and Emory and other schools. But really, it’s it’s that’s the fuel for the ecosystem. And then within the universities, it all comes down to who are the students graduating, what are they studying and what’s their entrepreneurial like desires. And I think that’s something that we share in our ecosystems. And I’m assuming many of you do as well, wherever you’re from. Certainly it is the case in New York City, but in Toronto, the University of Toronto, the University of Waterloo, these are very strong technical schools, very strong computer science, strong business, strong design, all the all the ingredients that helped launch great startups. And like Atlanta, which is a which is a major fortune. Five hundred center in Toronto is the Canadian headquarter city. I think it’s like twenty seven or twenty eight percent of all the headquarters in Canada and the entire country are in Toronto. And I think for city planners it’s actually an interesting thing to study because what’s happened in the case of Toronto and actually in when chatting with Barry, he confirmed the same with Atlanta is geographical zoning. The density of the companies matters. Toronto is becoming incredibly downtown oriented city, in part because of poor infrastructure and roads and lack of good transit. People who don’t want to have an hour and a half commute or an hour commute. They choose to live in maybe micro condos or small small footprint homes in the city. But that leads to a vibrancy of of of of accidental or deliberate collisions with each other, not vehicle vehicular collisions, but people meeting each other at events and at tech meet ups and at startup weekends, which is one of the things that we both organize. And I think the same you were mentioning is the case in Atlanta, the way the city has been zoned out, that there’s a lot of construction, a lot of high rises being built in the downtown core, and it’s fueling growth. But I want to touch on something you just mentioned about you were referencing T and Ludicrus, you know, pop culture, entertainment, arts and entertainment, sports. These are these matter. And we’ve seen it in Toronto. We are the NBA champs. I’ll remind you all here. And it’s funny, like two years ago, the I Heart Music Awards Male Artist of the Year, it’s a global awards competition like Billboard, all for male artists of the Year finalists. All four were from Toronto. You’re all thinking like, who are they? OK, I got Drake Weekend, Justin Bieber, Shaun Méndez, all from within, like a forty five minute drive of downtown Toronto. That’s for the whole world. That’s probably a statistical fluke, but it shows that there’s a tremendous amount of of cultural activity and energy and creation. And so one of the objectives that we have in my fund is to engage, to get some of these folks to kind of show up at a demo day or in a we work that we’re at or something like that. I don’t know if you’ve got any tips for me on how to how to get that done in Atlanta. But I think it matters that we have an entertainment industry that is kind of thriving and that fuels a lot of the tech. And I think you maybe you would like to just touch a little bit more on how you’re engaging because you’re becoming like the creative city, like that’s what Atlanta is getting known for. Right. And how how are you? How are you inspiring more of that?
Barry Givens [00:11:18] So I think one of the big things is what I hit on earlier is that. When we start to you know, people are in silos, right? You grow up making music your entire life, you’re around people that make music or a part of that industry. The same thing goes for corporate. You know, if you’re in that corporate structure, you’re going to go to work every day and you’re stuck in that corporate structure. That’s who you talk to. You go to conferences like this. Those are the people you meet. And one thing that we’re now so on top of TechStars, I also run a phone call collab with two other partners, Julia Bergesen, Justin Dawkins’, and it’s specifically focused on black entrepreneurs. And I’ll get into that a little bit later. But one of the things that you get is that these people now start when I say these people when you break down these barriers around the creative industries and start to mix them and bring them into the room with with entrepreneurs. And typically, you know, 15 years ago when that happened, they would typically send someone else into that room or they would send their business manager because the only thing they cared about was money. And typically the people in that room did not look like them. So they didn’t really care about the person in the room. And one thing that we hear a lot as far as you kind of joked about getting people involved on, one of the things that we hear a lot from these entertainers and athletes is we’re working with them is and in the I include the film and music. All that in the creative side is that we now get to walk into a room with people that look like our little brothers, our little sisters, our nephews, our nieces, and that engages them. That makes them want to get up and say, hey, you know, I’m going to actually make this meeting. I’m going to show up to this meeting. And now and as I mentioned before, we’re out there also solving a problem that my mom dealt with growing up. And this is a kind of an opportunity for all the investors in the room as well. I know that, you know, Atlanta and Toronto, they may be anomalies. They probably aren’t too many other cities that have these type of diversity metrics, but they’re airplanes. We have two of the busiest airports in the world and it’s very cheap to fly in. And so what happens is these opportunities, we’re bringing these people in the room and creating opportunities for other venture capitalists and investors to also fly in and have these same meetings. And the main thing that we want to do for now, I would say that this is probably similar to what you’re seeing in Toronto, is that many of the entrepreneurs that we’re getting around and then we’re matching them and bringing these creatives into the room is people have overlooked them for decades. Right. And as they’re being overlooked now, they we’re bringing I guess we call it the important people, the influencers into the room. Now, it’s making them more relevant. They’re more important. And so flying in as an investor, these are opportunities for you to get into markets that you may not have known about before. You may not have understood. I know you talked about a little bit on the the female the future female panel before us. But these are opportunities you may not understand. But what we’re trying to do is build a culture that you can now come into and write checks into and we welcome it. And so that’s a little bit about how we bring the creatives into the picture. But I’ll say in Toronto, I mean, you guys are, as you mentioned, one of the fastest growing cities. And you don’t have the the music capital of the world. You know, you have Tyler Perry who just opened up. He’s the first black owned studio for four film. Two hundred fifty million dollar studio. So how are you guys fueling all this growth?
Sunil Sharma [00:14:51] Yeah, so I think so. There’s a lot of money in Toronto and we’re seeing a lot of corporate philanthropy, a lot of foundational support to institutions. The universities are are generally public universities. Hospitals are health care, as you’ve heard, is public. So there’s an opportunity for money to be deployed into into things that people care about. So we’re starting to see the rise of hubs of more incubators and and programs and support. But I think it really comes down to people who, you know, don’t necessarily look like each other. In the case of Toronto, it’s a fifty two percent of the population is is is foreign born. It’s really high percentages. The UN says it’s the highest percentage of of foreign born citizen residents of any major metropolitan city in the world. And similar to Atlanta, which I think is more than fifty five percent African. Fifty three percent. Three percent. So more than half. I think that actually is the secret to what’s happening in both cities. It’s people that feel like if if they want to get to where they want to go, they it’s going to be up to them to make it happen. And they don’t necessarily get that pattern recognition that if I just stay in this corporate job long enough, I’m eventually going to be in the in the corporate suite of the Royal Bank or in your case that, you know, one of the large ups or Coca-Cola or any of the big companies, they might think that what we have to do is do our own thing. We have to launch our own company and be resource. And where, you know, it’s embedded in us from a young age to be entrepreneurial, we’re surrounded by family members who open up stores or have micro entrepreneurial activities of their own or even bigger ones. I think I think you grew up in an environment. You’re well, you’re definitely been surrounded by entrepreneurial life. You are an entrepreneur. But that is not also the fabric of Atlanta?
Barry Givens [00:16:43] Oh, yeah. I mean, just from a historical perspective, you think about being left out or ignored or kind of blocked out of opportunity. You look at the history of Atlanta from other industries from a music perspective, when there were no black record labels and face records launched. And now we had Toni Braxton, not just all these fantastic artists that also birthed So So Def with, you know, Criss Crossing. That was Jermaine Dupri label. And so where there wasn’t a table, we’re kind of known in Atlanta from an African-American perspective to go create a table and not complain about who’s not opening doors, who’s not doing this or that for us. And as I kind of alluded to it earlier with Tyler Perry, many of these African-American actors that you’re seeing now on the big screen, they couldn’t get jobs 15 years ago. So you look at the Taraji P. Hinson’s and the Meghann goods making she was getting a little bit. But many of these African-American actors and actresses, their careers were made because Tyler Perry opened up Tyler Perry studios and Woolpack, who started Packer Productions in the city of Atlanta. And they were all blocked out from a directors and a leadership perspective as well, not only the actors and actresses. And so to your point, it’s. When you have this a city like Atlanta or a city like Toronto, where there’s a leadership that is diverse, like having a when I wasn’t born in Atlanta, I was born in Milwaukee, Wisconsin. And I remember when we moved there when I was about seven or eight years old and we were driving through a neighborhood and I looked at my dad and all of these little black kids running around and bikes and these big old houses. And I look at my dad and I was like, black people live in these houses like this. We don’t have this in Milwaukee. And that mindset of being able to see something as a kid, it really fuels you being able to not have any ceilings or to not have any limits as you’re growing up. So as I was growing up, there was no one could tell me anything that I could not be like. My parents believed in me and that’s all I needed. And so very similar. When you have that environment where your family’s building businesses, you’ve seen entrepreneurship before. Even though I was the first graduate from college in my family, I wasn’t afraid of anything because we had a black mayor in the city of Atlanta. The entire time that I’ve lived there, my doctor was black, my dentist was black. Everything that I saw was that I could be whatever I wanted to be. And that fuels the growth, right. So now you have entrepreneurs growing up. You have people growing up with the sense that I can do and I can be whatever I want to be. And also, we’ve seen other from a tech perspective, we’ve seen other industries do it. And so now we’re trying to do that with the tech space. We’re building our own table so that we can. That’s why we started a fifty million dollar fund for black entrepreneurs is because we’re not complaining anymore that people aren’t writing. Even though we’re thriving in Atlanta, we’re still not getting African-Americans as a whole. We’re still getting less than two percent of venture capital dollars. And so we had to build that table. And it comes from that confidence. And that’s to your point. That’s what that’s what fuels the engagement in the ecosystem.
Sunil Sharma [00:19:47] Well, that’s actually a good point to kind of close to and this thing off with, which is that it’s meant as much as we painted a rosy picture of how aligned we are and how great these two cities are in terms of our ascent, no pun intended to among the tech world. But also it’s the fact that neither of us are considered Tier one capital investment cities. We’re not Silicon Valley. We’re not in New York City, we’re not London. What I see happening in Toronto is that there is more of an angel investment community taking shape. There’s some money that’s being taken off the table from companies like Shopify and others that have kind of gone public light speed and more in Montreal that have led to some investment that people kind of understand the need and the opportunity for investing in startups. There’s more seed funds, obviously, TechStars, but there’s more seed capital and some growth stage capital. But we have a lot of work to do, and I think you do in Atlanta as well in terms of, you know, pound for pound, getting up there with the big with the big cities in terms of tech investment.
Barry Givens [00:20:43] Oh, yeah. And I think one of the big takeaways or one of the things that I hope people take away is that we’re talking about diversity from an immigrant perspective, from a racial perspective. But every once you get outside of the Boston, Silicon Valley, New York, I’m kind of the top three places where venture capital is spent. Every city has a unique and diverse opportunity with the industry that they have. Like, what is it that you do well? What is it that you have that any other city, every other city is lacking? That can be your strength. And too many times, I think in cities, everyone is trying to copy Silicon Valley. Everyone’s trying to be Silicon Valley. When Silicon Valley, you can walk into a Starbucks and it’s thirty people that can write you a three hundred thousand dollar check. It’s not many cities, any other cities where you can get that. They also have the venture capital structure where they have, you know, 10 or 12 Damanhur billion dollar funds. Right. So being able to get the checks that you get in Silicon Valley or even in New York may not happen in your ecosystem. But one of the things that kind of we’re talking about now is fueling an ecosystem based on what you have and what do you have to, uh, to wrap up one more minute, are you building an ecosystem based on what you have available to you and not trying to copy Silicon Valley because you don’t have the resources that they have? And I know I’ll make that quick. We have to wrap up, but.
Sunil Sharma [00:22:05] Yeah, yeah. And just to close, Berry and I made a commitment that if Ascent has its back next year, we’re actually going to come back here with with delivered plans that actually involve connecting materially our our cities. We think it’s a big opportunity. We didn’t realize it actually before before we started strategizing about this panel. I don’t think anyone really thinks the two cities that need to light up are Toronto and Atlanta, Georgia, that that isn’t on a lot of people’s radar. But we we get it. And whether it’s engaging airports, municipal leaders, sports celebrities, musicians or just entrepreneurs, we’re going to do it. And we have we got some big ideas. So, again, Barry and I are both with tech stars are we’re recruiting for startups. We’re easy to find. Sunil Sharma at Texas Dotcom and.
Barry Givens [00:22:54] Barry Givens at TechStars dot com.
Sunil Sharma [00:22:56] And we’ll, uh, we’ll talk soon.
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