Tech community eyes recruitment growth, partnerships, collaborations in 2023

The Birmingham tech sector experienced growth, new starts and failures in 2022 as the city and the world as a whole emerged from a tumultuous era marked by Covid-19, layoffs, the Great Resignation, and — as some call it — the Great Reinvention.

On the cusp of 2023, Birmingham leaders, founders and innovators in tech and entrepreneurship weighed in on what the future holds for the Magic City.

The coming year will see new business creation and the development of more resources to help young ventures find long-term success within Birmingham, according to Miller Girvin, executive vice president of innovation and entrepreneurship at EDPA.

"Birmingham has had some changes in leadership and additions to its entrepreneurial sector over the last few weeks, and I’m excited to see what 2023 brings," she said. "From Brooke Gillis’ hire as the new CEO of Innovation Depot and Maria Underwood taking over the reins at Birmingham Bound, to the establishment of a new venture studio at Southern Research, I’m very optimistic that some strategy and structure will help the tech sector of Birmingham grow."

The city's tech sector's greatest opportunity for 2023 may also be its greatest challenge, she added.

"The talent pool graduating from Alabama colleges each year is excellent, but for that very reason, it’s competitive," Girvin said. "We often struggle to keep our talented graduates in the state, working for homegrown businesses. Talent retention has become a core focus of EDPA, Innovate Alabama and many other organizations around the state, which I believe will create both opportunities to showcase our employers and our communities as well as continued challenges to fill new jobs in a tight labor market. These efforts will take years to show results, so time will tell."

Tony Summerville, founder and CEO of Birmingham startup Fleetio, said the city is only marking the beginning of a strong reputation in tech, adding that he sees opportunity in building on the momentum of programs and initiatives like Techstars, Birmingham Bound, Venture for America and REV Birmingham.

A challenge, he said, will be recruiting more growth companies to encourage people to move to and stay in Birmingham.

"Birmingham has a great tech community and we’re starting to see other people realize that," Summerville said. "We have some amazing organizations and initiatives in place that focus on recruiting, fostering and retaining tech startups in Birmingham. With the support of the community and a low-cost working environment, you can see why entrepreneurs are moving to Birmingham to kick off their project."

Tanveer Patel, co-founder of Concert Care and currently on the board of directors of ConcertIDC, believes that more people will return to in-office work in Birmingham as Covid-19 worries lessen.

"I would still think it will be a hybrid with some people asking for remote work, some partial remote," Patel said. "So a mix, but more people returning to work. Working remote will remain as a perk now that many tech employees will expect."

She added that entrepreneurs have learned to harness the potential of remote work, giving them another tool to attract and retain. And 2022, she said, saw an overheating of tech salaries, which she expects to cool in 2023, making hiring more accessible to startups.

Patel also expects to see growth in AI and related fields in Birmingham, specifically in health care.

"I am aware of a company which has bagged several federal contracts in the AI space," she said. "With that comes the challenge to attract the right talent. Unlike traditional software development, AI needs specialized skills."

Local entrepreneur and fundraising executive Maria Underwood, who recently accepted a role as president of Birmingham Bound, said the organization will focus on collaborating with the city, current tech organizations and funders as well as recruiting, retaining and growing startups in 2023.

"The startup ecosystem right now is truly at a tipping point," Underwood said. "There is a strong coalition of leaders in the city committed to supporting the tech ecosystem, and all the pieces seem to be in place now to really grow and support startups and their founders. I think you'll see more collaboration from the established business community to the startups, more companies moving into Birmingham specifically for our strong ecosystem and a focus on developing the workforce that those companies will be looking to hire."

Underwood added that as Birmingham grows, it is a crucial time to learn from issues plaguing other major tech hubs such as unaffordable housing and an oversaturated market and get ahead of those issues with proactive solutions.

Though the Birmingham tech sector saw explosive growth in some areas in 2023, there were some low points, consisting of layoffs and startups closing their doors.

Birmingham's Landing initiated a second round of layoffs impacting remote workers and Birmingham and other cities, impacted an undisclosed amount of employees, just over two months after the company laid off 110 employees in a restructuring effort in October.

Local tech startup Fledging, with offices in Birmingham, Dallas and Shenzhen, China, announced its closing in November, following local tech startup Datalus closing in December.

"Starting a business is inherently risky," Girvin said. "There will be successes, failures, pivots, expansions and shrinkages. I don’t believe there is any cause for concern as we go into 2023. The flywheel of startups in Birmingham, and more broadly in Alabama, is reaching the level where those talented folks will quickly find a great job at another company. They will have lessons learned from their previous experience and will apply it to their next."

Patel said the layoffs and closures are a reflection of adjustments in the industry which will quickly settle.

"I don't see any concerns since there is still strong demand for knowledgeable workers," she said. "The workers coming out of fine companies like Landing will definitely be sought after and hired in other companies. We also have seen at national level big techs layoffs."

Underwood said that as the city gains more startups, naturally, there will be some closures.

"Closings in the startup space are extremely common, and as Birmingham gets more startups, we'll see more of that," she said. "What is good about seeing startups close is that they are starting -- and they're doing it here. Startups closing means that we have more seasoned, more experienced entrepreneurs who will go into their next venture with lessons learned.

"As a city we need to embrace those founders and help them move towards their next opportunity until they hit their best idea."