We provide this update every six months, and we’ve enjoyed doing so because it gives us a chance to reflect on the market that we love so dearly. However, this perspective is different, and for obvious reasons. In some ways, it’s the most difficult installment to write; in some ways, it’s the easiest to write.
On the easy side, finding exits, funding rounds, and other entrepreneurial news (or, at least, public news) is easy. There simply is not that much. Our list of funded start-ups – which we will update again in January 2021 – has not grown significantly, nor have there been many exits.
The reason, of course, is easy to guess: COVID-19. The entrepreneurial capital markets were closed, so there isn’t much to rehash on this.
But that, of course, is why it is so difficult to assess Birmingham’s current entrepreneurial scene as well. What has the COVID-19 crisis done to Birmingham start-ups? I don’t think it’s done any good; I wrote about the dire need to save our start-ups here, and since that piece was posted, I haven’t seen anything that changed my perspective. Additionally, the good and the bad aspects of Birmingham’s entrepreneurial scene that I wrote about a year ago are still there. We have some great things going for us; we have some negative things as well.
How this plays out is anyone’s guess. During this pandemic, one of my mottos has been that you can’t plan for the apocalypse. Of course, naming the downsides of COVID-19 is pretty easy. But if you get too pessimistic, you may run away from the business scene just when doing more may make the most sense. Healthy optimism may be required now more than ever. So, recognizing and acknowledging that this is overly rosy, let me give you a sunnier perspective:
- Recent events have raised social consciousness, which makes it more likely for entrepreneurial ventures to be funded based on the merits of the deal and of the founders, as opposed to capitalism based on cronyism. This increases the number of fundable deals and growing companies for a more diverse group of people.
- Zoom makes transactions more efficient and allows easier access to institutional capital outside of the Birmingham area.
- Innovative trends accelerate the pace of the Birmingham entrepreneurial economy. Online learning, remote working, and food delivery are just some of the Birmingham businesses that have been boosted into prominence by the current situation. As we continue to work and live in a new environment, we strive to maintain and increase access to things that are important to us as individuals and as a society. Entrepreneurial companies will work to meet the demands of this new way of living.
- People from big cities are beginning to realize the benefits of mid-tier Southern cities, with their milder climates and great outdoor spaces. With more remote access to talent, people from big cities may begin to move to Birmingham to flee the crowds.
Will all of these trends play out in the most favorable manner? Probably not. But we need to be on the hunt for green shoots sticking out in the field to continue to encourage, nurture, and develop entrepreneurs, start-ups, and the new economy.
Additions to Our Funded Start-Ups List:
- The Porch Pod: “Birmingham company Porch Pod aims to keep online deliveries secure”
“AL man develops Porch Pod to keep your packages safe this holiday season”
Additional Exits from Our Funded Start-Ups List:
Additional 2020 Articles on Funding for Birmingham-Area Start-Ups:
- Case Status: “Birmingham legal startup raises $1.5 million”
“Birmingham firm gets $1.5 million in funding”
- ProctorU: “ProctorU merges with Canadian firm”
“ProctorU merges with Canadian company for joint venture”