Georgia companies have raised almost $2 billion of venture capital in the first half of this year, already surpassing the total amount of money raised in 2020.
The amount of capital coming into the state is a testament to Atlanta, which receives the bulk of the funding, emerging as a technology hub. The city has a growing number of startups with $1 billion valuations and local venture capital firms.
Georgia companies raised $1.99 billion in the first half of 2021, according to PitchBook and the National Venture Capital Association’s Venture Monitor report for the second quarter.
That’s $73 million more than the amount raised in all of 2020.
National investors now see Atlanta as a formidable innovation hub, spurring an influx of capital for growth. Atlanta’s low cost of living, tech talent pool, international airport and diversity of industries and people are often cited as advantages to the tech ecosystem.
The most Georgia startups have raised since 2006 is $2.6 billion in 2019, according to the report. The deal flow of that year was more consistent than in 2020, showing the effects of the pandemic on how capital was deployed during the spring of economic uncertainty.
If this year’s trend continues, 2021 could break 2019’s record by almost double.
The past five years have shown a continued upward trend for the amount of capital coming to Georgia startups. In 2016, the state brought in $506 million over 145 deals, compared to almost $2 billion across 117 deals this year, according to the report. That data shows startups are now raising larger funding rounds with each deal.
The numbers correlate with the number of funding announcements and high-growth startups that are taking over the Atlanta tech ecosystem. Calendly and SalesLoft, which both started in the Atlanta Tech Village co-working space and incubator, surpassed $1 billion valuations in January with massive funding rounds.
Data privacy and security startup OneTrust, named the No. 1 fastest-growing private company in America by Inc. Magazine in 2020, raised $210 million this year, setting its valuation to more than $5 billion. Surveillance startup Flock Safety joined the unicorn ranks this week.
As Atlanta startups reach more milestones, experts say it makes it easier for the next generation of startups to prosper as the city cements its title as an East Coast tech hub.
Atlanta also has more local venture capital firms to support early and growth-stage companies, which was long a key ingredient lacking in its tech ecosystem. In March, Silicon Road closed a $31 million fund, Overline closed its first fund of $27 million, and Zane Venture Fund is raising its first $25 million fund. In May, Collab Capital raised a $50 million fund.
Panoramic Ventures, founded by serial entrepreneur Paul Judge and BIP Capital CEO Mark Buffington, is raising a $300 million fund focused on underrepresented entrepreneurs and regions.
These firms are not solely focused on investing in local companies, but they add more capital into the ecosystem and contribute to Atlanta’s reputation as an innovation hub.
Eight venture capital firms raised funds in the Atlanta market in the first half of 2021, according to the report. That’s already a record number for the city. In 2019, seven firms raised funds.
