Birmingham Startups Take a Turn in the Spotlight

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When Target bought Birmingham-based Shipt, the online grocery delivery service last year, it drew attention to the city’s tech startup scene. Local entrepreneurs get another chance in the spotlight this week. AOL co-founder Steve Case brings his Rise of the Rest tour to the Magic City Wednesday. There will be a pitch competition with $100,000 in seed money going to the winning concept. But overall, it’s an effort to highlight startup communities that aren’t in tech hotbeds such as San Francisco and New York. Case spoke with WBHM’s Andrew Yeager.

The tour stems from Case’s venture capital firm Revolution and is aimed at highlighting and investing in startups away from the traditional tech hubs on the coasts.

The majority of venture capital goes to three places – Silicon Valley in California, New York and Boston. Even places such as Chicago and Seattle only pull down a sliver of the money.

But Case says entrepreneurial activity outside of those top markets is an “untold story” that many investors aren’t focusing on.

“You’re starting to see some of the next breakout successful companies not on the coasts but in the middle of the country,” says Case. “I think people will be surprised over the next decade how these cities rise.”

Case says smaller markets are showing expertise in specific sectors such as agriculture technology in St. Louis or robotics in Pittsburgh. He says that specialization is essential as what he calls the “third wave” of the Internet develops where technology transforms established industries from healthcare to energy to education.

Case also says the pull of entrepreneurs to the coasts is slowing a bit with people either staying in or returning to smaller cities.

“There’s opportunity in places like Birmingham. They don’t have to be in San Francisco or New York to pursue their dreams,” says Case.

Big tech companies–most notably Facebook– are facing something of a backlash over issues of influence, privacy and control of information. Case says he’s not surprised to see that as technology has pushed farther into daily life. He also believes that may encourage investors to look outside of the traditional tech hubs.

“The question is which [cities] really rally as cities, as communities to capitalize on that opportunity,” says Case.

And Case says to establish a level playing field with the top markets, it’ll take places like Birmingham celebrating its own startups in an effort to attract more talent and money.

Andrew Yeager

Andrew Yeager

Host/Reporter