Commentary: Tampa Bay business ecosystem thrives in face of economic challenges

When the pandemic broke out in March, the markets and the economy took a big hit in late Q1 and early Q2. While the stock markets have largely recovered and even gone on to set new record highs, other parts of the economy continue to languish. Most retail-related businesses are still operating at only partial capacity (if at all) and countless people remain out of work. With the continued uncertainty surrounding the pandemic and the upcoming presidential election, there are certainly more challenges ahead.

With these economic challenges, it would be easy to assume that early-stage companies and startups have been significantly impacted as well. While it is certainly true that many early-stage companies (just like companies of all sizes) have been negatively impacted, the business support ecosystem has continued to thrive, with local companies of all sizes landing new rounds of financing from investors, both local and across the country.

Through a U.S. Economic Development Administration (USEDA) grant, Tampa Bay Wave, StarterStudio, and others have collaborated over the last two years to create Upsurge Florida, which has been working hard to raise awareness of early-stage investment opportunities across the I-4 corridor. This effort has included several live events targeting accredited investors, ultimately connecting dozens of investors, investment firms, and early-stage companies across the region. And while the in-person Upsurge Florida events have been put on hold by the pandemic, the relationships have continued to develop, leading to several sizable and meaningful investments for early-stage technology companies over the last several months. Several Tampa Bay Wave-related companies have landed six and seven-figure investments during the pandemic, and Florida Funders continues to drive seven-figure funding deals for multiple Florida-based companies as well.

Many technology businesses at all stages have thrived during these challenging times, attracting both new customers and new investments. Some are in businesses that have seen greater demand as a result of the virtual work and living environment. Others have pivoted their business models or products to adapt to the new and changing world. Several well-established local companies have attracted significant financing in spite of the challenging economic environment, including at least one nine-figure investment and one potential pending IPO.

All of these data points speak to the strength and sustainability of the local technology and business ecosystem. While many industries are facing tremendous challenges, others are thriving. The investment community has proven to have significant dry powder on hand and continues to search for meaningful investment opportunities. Supporting organizations like Tampa Bay Wave, Embarc Collective, and others continue to provide guidance through the world-class accelerator and support programming, helping to prepare early-stage companies to attract financing and embark on aggressive growth paths.

Investor awareness efforts through Upsurge Florida continue to work on the two-fold goal of increasing investors’ comfort level with the early-stage technology asset class and in building larger investor networks throughout the region. In fact, several new investment groups and funds have launched during these challenging times, including Lakeland Venture Investments (LVI) and Bellini Capital, both of which have been featured in recent news reporting.  And in light of the challenging racial times facing our country, the Seedfunders Opportunity Fund was launched to provide early-stage pre-seed funding specifically for Black entrepreneur owned businesses.

For early-stage companies who may be facing significant challenges, now more than ever is the time to think creatively and innovate in their business models and approach. Investors are hungry for high-quality businesses and innovative solutions. There will certainly be some level of hesitation and potential downward pressure on valuations, but with public markets continuing to thrive – for technology companies in particular – there is a tremendous opportunity for innovative companies to leverage the resources of the ecosystem and to capitalize on investors’ desire to put their capital to work.

Brian Deming is a veteran technology entrepreneur, executive, investor, and board member with more than 30 years of consulting and business leadership experience. He is the co-founder and former President of Tribridge, a software technology company that was acquired by DXC Technology (NYSE: DXC). Deming currently serves as Board Chair for Tampa Bay Wave and Vice Chair of the Board of Directors for the United Way Suncoast. He is an active investor through Florida Funders, as well directly in local tech companies. Deming holds a Bachelor of Science degree in Systems Analysis from the University of Miami.