You Should Start Your Company In Atlanta | A convo with David Cummings of the Atlanta Tech Village…


This post is by MPD from @MPD – Medium


You Should Start Your Company In Atlanta | A convo with David Cummings of the Atlanta Tech Village, one of the country’s largest innovation hubs

On today’s episode I catch up with David Cummings, an entrepreneur on a mission to put Atlanta on the map when it comes to tech and venture capital. He also happens to be an old friend of mine.

David and I met during our undergraduate days at Duke where we were two of only a few entrepreneurs on campus. My endeavors fizzled out while David’s became massively successful. He sold one of them — Pardot — to Salesforce for $95m and another — Hannon Hill — is still active and continuing to scale.

David’s current focus and passion is the Atlanta Tech Village, an innovation hub he’s created in a building located in the heart of Atlanta. As he puts it, by creating an ecosystem for startups and entrepreneurs he’s “engineering serendipity” with the goal to make sure Atlanta is reaching its full entrepreneurial potential. Out of it has come many successful companies, including Calendy of which David is an investor/board member.

During our chat David breaks down how the Atlanta Tech Village operates, the VC fund he invests out of, and why companies should HEAVILY consider getting their start in Atlanta.

Listen via your preferred platform or watch/read below.

Follow us on Twitter:

@davidcummings / @ATLTechVillage@mpd

Transcript:

MPD: [00:00:00] Welcome David. Thanks for being here,

David Cummings: [00:00:03] Mark. Thanks for having me. Great,

MPD: [00:00:05] excited to have you. Um, so we’re going to start off, I’ll just do a brief intro on your background. I find that that saves a little time and forces us to talk about the more interesting stuff or. Ideas concepts and challenges. All right.

So, uh, David’s got an incredible background. I like to tell people stories because I think they’re often more impressive than they’ll let on. Uh, he is the founder of the Atlanta tech village, which is a skyscraper in Atlanta. It’s the fourth largest entrepreneurial space in America. Huge community and a major cornerstone of the Atlanta startup scene.

He is an investor in a number of startups, including Calendly, which I believe is a unicorn now. And you’re on the board of that, uh, dragon, army SalesLoft, and many others. And before he took on, uh, all of this broader Atlanta mission, which we’re going to talk about. He built and sold Pardot to Salesforce.

And probably some of you listening use that software because it’s still in her its existing brand original brand for $95 million at a great exit. Um, so he’s a successful entrepreneur has gone a to Z and before Pardot, he started Hannon Hill out of his dorm room at Duke. And that’s when we met. So I saw him actively making the magic happen.

Uh, the company is still alive and kicking 20 years later, and I’m excited to get an update on that. This is his official clubhouse debut. So please follow him so you can keep, uh, up to speed and all the things he’s doing. And as he gets more active on the platform, you can also follow him on Twitter at David Cummings.

What did I Ms. David anything? Or is that the idea of justice?

David Cummings: [00:01:41] No, that’s great. Yeah. Lots of, lots of exploratory ventures over the years. Some work some didn’t. Yeah. We’re just

MPD: [00:01:48] going to focus on the success. We’re just going to make you look good.

David Cummings: [00:01:52] Well, that’s, that’s the, uh, the venture world in a nutshell, lot of, um, when the startup works, it gets all the credit and then when it doesn’t work, nobody remembers it.

So good to talk about the wins.

MPD: [00:02:03] Yup. I agree. And that the short-term memory works in your favor as an entrepreneur. Absolutely. Um, so, uh, let’s jump into the Atlanta tech village because I think it’s a big name. Uh, and I think it’ll give folks listening who don’t know you some context and the things you’ve been up to.

So it’s worked backward. Uh, can you just start by giving us an overview of the Atlanta tech village? So people get a sense of that.

David Cummings: [00:02:25] Sure. So the idea for the Atlanta tech village was to establish a center of gravity in the Atlanta startup ecosystem. When I bought the building back in 2012 Atlanta at the time had a few startup successes, but it wasn’t known as a startup hub and it didn’t have any center of gravity from a community point of view.

And so the big idea was how can we get. Thousands of entrepreneurs under the same roof. How can we create community? How can we engineer serendipity with the ultimate goal of being a greater chance of success by being in this community, by being in this building, by being around each other, the chance of you succeeding as an entrepreneur goes up and the past nine years has proved that thesis to be correct.

MPD: [00:03:11] Do you have a way you measure that? How do you know that someone has materially more likely to be successful? If they domicile within the walls of the Atlanta tech village?

David Cummings: [00:03:21] We do. And we do it by looking at the success rates, the rates of raising money. We look at it at the exit rates. We look at it at the number of jobs created.

And so the, the startups that have been in the tech village and have graduated from the tech village have raised $2 billion of venture capital in the past nine years. And they’ve created over 7,000 direct jobs and then a much larger number of indirect jobs. So tracking capital raised and job creation, comparing that to the overall average for startups, the ones in the tech village have been much more successful on average.

MPD: [00:03:58] That’s an awesome stat and crutch. Congratulations on the work there. When you talk about setting these companies up to be successful outside of getting them in the same space, what have you learned? What are the tricks that other people running office spaces co-working should be doing to really invigorate and stimulate innovation?

David Cummings: [00:04:18] For us, we really boiled it down to engineering. Serendipity. It sounds silly, but this idea of how can we bring people together? What I found is entrepreneurs are typically. Good at one thing, I might be good at fundraising. You might be good at product development and other one might be good at the ideation side of things.

But when you bring a bunch of entrepreneurs together, entrepreneurs by their very nature are glass, half full type people. They’re optimistic. They want to change the world. And so getting a thousand of them under the same roof. And then working to create these natural collisions, all kinds of great stuff happens that you could never plan for.

And so to make these things happen, it’s everything from, you know, Friday chow downs, just group lunches, to special interest groups, you know, iOS developers as different from crypto developers, as different from marketing groups and sales groups and product development groups. And then really having all kinds of speakers and mentors and advisors.

So really just everything, you know, the old saying, it takes a village to raise a child. It takes a village to raise a startup. And so it’s proved to be more successful than we could have even ever imagined.

MPD: [00:05:33] You engineer that serendipity just on an operational level. Is it, is it as simple as hosting events and creating email lists or is there.

Some, you know, I’m always looking for creative ways to create the glue between all the different people. I know. And it seems like it’s always just comes down to elbow grease and breath it’s and just basic operational thing. Is there any wizardry you found outside of the basics?

David Cummings: [00:05:58] There is a lot of elbow grease.

So having great people, of course, on the staff side, people that are making the intros and setting up the meetings and figuring out different personality types and building relationships with the entrepreneurs so that the entrepreneur will share the truth. You know, a lot of entrepreneurs like to paint a rosy picture.

They like to paint that things are going well, but we all know behind the scenes that entrepreneurs are. You know, they go through a lot of stress. There’s a lot of high highs and low lows. And so building the relationships to get the real meat of the conversation what’s going on, what are the real challenges, and then using that to be able to connect them and make the introductions.

And then on the meat and potatoes side, it’s, it’s bringing entrepreneurs together through some themes. So we have what we call the six-figure club. And so the six-figure. Six-figure club is entrepreneurs in the building that have raised six figures of angel investment, right? So you’ve raised, it’s a couple hundred grand, you’ve raised a seed round you’re building products.

And so we just bucket them all together in that six figure club. And then we have a seven figure club. So entrepreneurs that have raised over a million dollars. And so looking for some of these different. Ways to categorize the entrepreneurs in a very broad, general manner, and then bringing them together over zoom calls in person meetings, that kind of stuff.

So a little bit of infrastructure and a lot of relationship building and just working hard to pay it forward. Trying to be helpful. I love that.

MPD: [00:07:28] Now it’s a for-profit business, right?

David Cummings: [00:07:30] It is. It’s a for-profit business. You know, we charge roughly $350 per person per month. You can think of it as a, we work type space, higher end in terms of finishes and design and layout, but then it’s curated for just software companies.

So imagine walking into a, we work with 103,000 square feet across six floors and it’s exclusively software companies. And so we have. Just the whole business is curated around that specific audience.

MPD: [00:08:03] That’s funny. Fantastic. Now, how did you, you said you bought the building. How did you finance that was, did, did you find some real estate partners to go in on this with?

Or how did you think about setting this up? Because it’s not your background, right? I know the community is, but you’re a startup guy by training. So how did you decide to make the leap to real estate?

David Cummings: [00:08:22] You know, back in the day, it seemed a lot crazier than it seems now, back in the day, you know, we work, wasn’t a thing, coworking, wasn’t a hot area, the future of work, wasn’t a daily discussion.

And so the big impetus for it back in 2012 was really the desire to build community in Atlanta. You know, a city that’s, you know, the ninth, largest city in the country. Has lots of sprawl has lots of suburbs. And so creating a center of gravity had to have some scale to it, had to have some mass to it.

And then from the real estate side, you know, again, pre co-working, it was just a huge hassle to balance between subleases or try to try to find a good deal. You know, the, the traditional commercial real estate world is not geared towards companies that don’t have operating history companies that don’t have strong balance sheets.

You know, it’s just. Normal commercial real estate is the antis startup, um, in terms of what they look for. So at the time it was very novel. And to answer your question directly after selling part of, you know, I just had some cash in my checking account and I just wrote a check for a hundred, 3000 square foot building.

It just made it happen. That’s awesome.

MPD: [00:09:38] I love that you could do that. That’s baller. Um, how is, uh, how’s the business doing with COVID? How, how have things evolved for you? I mean, there’s probably a lot of other entrepreneurs. I know there’s dozens in New York that are navigating this crisis, uh, who were on the real estate side of the world and are trying to stay alive.

Did you have, do you have any strategies that people could employ to kind of keep above water until things turn back on?

David Cummings: [00:10:03] On the pure real estate side, you know, it’s been challenged. The community side has, has held up through zoom and a lot of phone calls and emails and group lists and trying to do it that way.

But it obviously it’s nothing the same as in person, but it’s held up. Okay. You know, pretty good in light of everything as a real estate business, you know, knock on wood because we didn’t have any debt. Because there’s no mortgage on the building. It hasn’t been that big of an issue. Obviously revenue is way down net operating income is way down, but you know, there is never a mortgage payment looming on the horizon.

So, you know, at the end of the day, everything’s going to be fine. And we’re optimistic that we’re going to come back strong.

MPD: [00:10:46] Yeah, you can weather the storm. Are you seeing any signs that people are coming back online now that the vaccines are somewhat penetrated in the market?

David Cummings: [00:10:54] A little bit, we’re seeing more so signs of people just pulling their hair out and have to, having to get out of their house, having to have a change of scenery, having to have some structure.

And so, you know, we’ve rented out several offices just in the past 30 days, several new members in the past 30 days. So it’s, I think people hunkered down for good. You know, 10, 11 months. And once the vaccines were starting to happen. And once the light was at the end of the tunnel, we’ve seen a nice uptick in activity.

Uh, really just in the past 30 days is when you

MPD: [00:11:26] look into your crystal ball, when do you see. Of, you know, return to work happening in the new version of what it’s going to be, but in fairly full force, is it six months out, three months out? What’s your, what’s your internal

David Cummings: [00:11:39] task? The magic timing is labor day.

So plenty of time for the vaccines to roll out plenty of time for people that have already scheduled a bunch of summer activities for the families, for the kids, plenty of time for the office providers. To do some restructuring of space, making it more collaboration, hubs, and less private workspaces. And then, you know, once school’s back in session, you know, right after labor day, labor day, I think it’s, you know, back to the new normal, whatever that is.

And I think the new normal for most companies, at least the ones that I’m involved in the new normal is really. Work anywhere you want whenever you want. So it’s a digital first remote type setup with collaboration hubs in different cities. Right. So it might be a 20 person office in Atlanta that you can go in and work out of as much as you want, but you’re not going to have an assigned desk.

It’s not the office that the company works out of. It’s a collaboration hub in Atlanta. And now this is obviously skewing more towards the tech startups and more towards the high growth venture back companies. It’s a different world for the old school businesses, but I think collaboration, hubs and, and work flexibility is, is the new norm.

For the startup world, especially companies that are competing for great talent.

MPD: [00:13:01] We’re trying to figure this out at interplay. We’re talking about what we’re going to do for our office. The current concept that we’re floating is a remote first construct. Where we’re at, we’re thinking about churning and I don’t think this is totally novel, but I want to bounce it off.

You can get some thoughts, churning kind of the structure of, Hey, you’re allowed to work from home two days a month or once a week, or whatever people used to do on its head. And it’ll be remote first, but you have to be in the office five days a month, 10 days a month, some number to create some sort of serendipity distill your word.

Right. Otherwise I think there will be people who are never there at all. Right. So we’re thinking about getting a space. Um, that’s maybe to your point, like a hoteling operation, no assigned seating, smaller footprint, maybe there’s six desks for every 10 people, but, um, this is kinda what we’re floating, but the idea is everyone has to be present sometime, unless they’re working out of the state, out of the country and they’re taking a month remote, which is awesome.

What are your thoughts on that as a method? And if that is what’s going to happen going forward. How do you have to, how do you, how do you, and, you know, co-working and all the other folks that are providing really valuable office space solutions for the more innovative folks out there who are having dynamic company structures, a lot of change, how does the model have to evolve to accommodate that

David Cummings: [00:14:26] a few thoughts there.

One is for our team at the tech village, it’s obviously we have the physical building. We have all the infrastructure. We’re taking the approach of one day a week in the office. So call it Mondays. And then every other day of the week, whatever is best suited to your style of work. So some people want to come in.

Some people want to work from home. Some people want to work from the Lake house or whatever it might be. So for businesses like the tech village as a business, we’re going the one day a week. Team in the office team meetings, team lunch, and then four days a week, flexibility. Other startups like Calendly, which was in the tech village for five years, Calendly has taken the approach of being completely remote first.

We’re calling it digital first, but same thing. And so with time they haven’t been done yet, but with time there’ll be collaboration, hubs in different cities. And you know, the majority of the employees are in Atlanta right now, but. Over time. It’ll just depend on wherever the best talent is. And so that’s our approach.

MPD: [00:15:39] Very interesting. Um, what are the ancillary benefits for someone like you and owning a building and having kind of a, a hub? How does that change your game as David? Not as, uh, Atlanta tech ventures.

David Cummings: [00:15:54] I think it’s a lot of fun. Right. You know, we did, uh, obviously the build-out, so we spent $16 million on the build out of the building eight years ago.

So it’s fun to work with architects and see a concept and an idea come to life. You know, the bits and bytes world is tons of fun, but the Adam’s world is quite fun as well. So for me, scratching different creative itches, it’s been great. And then as a building. Yeah. There’s lots of things that I’ve learned on the investment side.

So, you know, I invest into a startup and you know, there’s no liquidity, there’s no line of credit. There’s no collateral that I’m able to borrow against. If I wanted, you know, with the building, it’s easy, it’s real estate and you can go get a line of credit or go get a mortgage on it. And so there’s, you know, different liquidity trade-offs and then in the commercial real estate world, There’s a number of other factors that it was fun to learn about like there’s depreciation expense, which can actually save you a lot of money on taxes in the short-term and the long-term.

You still pay the same amount of tax, but in the short term, you’re depreciating a building that you’re still getting use of. And it’s resulting in paying less taxes in the short term. Again, when you sell the building, you have to, you know, true it all up. So it’s just been fun to learn about a whole different segment of the economy.

MPD: [00:17:09] Okay. And what about the. Connective tissue. I mean, you, you mentioned, uh, Calendly was in the village. Um, I know you were on the board of the company. What’s the positive circumstance or dynamics that are created when you have a lot of entrepreneurs working in a space that you operate. I’m assuming it creates a lot of opportunities.

David Cummings: [00:17:29] Oh, absolutely. Yeah. I mean, Calendly would not have happened as an opportunity for me to be the, you know, the sole angel investor in the business, if it wasn’t for the tech village. So from the investment front, It’s great to meet with entrepreneurs. There’s no obligation of investing. There’s no equity component to being in the tech village, but as an entrepreneur, trying to help other entrepreneurs, as you can imagine, there’s lots of opportunities that arise out of it.

So just paying it forward and helping to try to grow the community has resulted in a number of great opportunities. Obviously with Calendly being the most famous of them.

MPD: [00:18:08] You just referenced something that, um, came up in my conversation with David Cohen at Techstars last week, right? This idea of, you know, he use different language.

You use slightly different now, but the phrase we’ve always tossed around is the more you give the more you get. And I don’t think we created anything about that. That seems to be deeply ingrained startup ethos. Right. Particularly in the more nascent markets I think for, uh, for sure, because our. It’s more of a team sport as everyone’s trying to make something work.

Is that, how is that energy? Is that, is that entwined, intertwined in the Atlanta community at this point to the people in the tech village, get that, was there an edge, was there a learning curve to kind of get people up on that help mentality help first? Or did people show up and day one that had been permeated through the broader ecosystem before you had the center of gravity there in some way or another.

David Cummings: [00:19:02] I think that the tech village really embodied it, you know, from day one, we had our core values of being nice dream, big, pay it forward, and then work hard, play hard. Any blue devils in the audience will know where the last one came from. And so making that th the, you know, the core values from day one.

And so again, on the culture fit side, You know, we have a culture screening team for entrepreneurs to get into the tech village. So we were defining our standards and then we were attracting people that believed in those standards. And so the pay it forward element has been a huge component of it. And as an example, on that side, you know, a lot of it in the startup world, as we know, you know, most startups fail.

99% of startups never. Achieve $1 million of revenue in a calendar year ever. Wow. So that’s cause they’re so stacked against you. What we found is that by building these relationships and by paying it forward and by attracting people who believe in these same core values, We’ve had what we call a lot of recycling talent.

Right? So entrepreneurs are working on something. Again, most of the time it doesn’t work out. The entrepreneurs down the hall are working on something different. It does work out, they’ve built rapport, they’ve built relationships. And so when the entrepreneurs that, you know, it, isn’t working out, they say, okay, I’m hanging up my cleats.

I’m calling it a day. But my buddy down the hall, she has got this thing. That’s going gangbusters. We’ve got a great relationship. We’ve got complimentary skill sets. We’re going to recycle talent and go join them. And so what it’s done is it’s made it so that the winners win even bigger. And the ones that work in a win, you know, they have more opportunities around them.

And so that whole pay it forward. Plus the recycling of talent has proved to be a great formula that I didn’t, I didn’t fully appreciate without having the opportunity to see it play out over the course of eight or nine years.

MPD: [00:21:01] I’m sure you didn’t foresee all of this stuff when you, um, when you turn the lights on at the village.

But when, when I, uh, when I, when I look at this maneuver of setting up the village, uh, it feels like, uh, it’s created a hell of an opportunity for folks who are trying to figure out. They’re way in entrepreneurship or trying to figure out how to do this, to get mentorship seems like a huge opportunity.

What is the admission process like for you guys? Because when I think of typical co-working spaces, it’s just, you know, an order and a queue. You, you put your, you took a number 35 and when there’s a 35th office available, you’re in, it sounds like you guys are actually filtering and picking, picking who’s part of a part of this, uh, organization.

Is that the case? And if so, how hard is it to get in the village?

David Cummings: [00:21:50] That is the case. So we have our culture check team, and again, we want to be inclusive. We want to be a place that anybody can participate, but we want people that believe in our values. And again, be nice, dream big, pay it forward, work hard, play hard.

And so we’re really assessing. People that believe in those values and that will be a culture add they’ll, there’ll be additive to our culture. And as you can imagine, over the years, we’ve had some, some bad apples make it through and it quickly becomes apparent. You know, the most common example is somebody that is on their best behavior during the culture check interviews.

And then as soon as they’re in the village, all they want to do is sell to the other startups that are in the building. And so they’re really motivated by just trying to find a new customer. And they’re not motivated by paying it forward and helping increase everybody’s chance of startup success. So quickly answer your question.

We have a series of interview questions and it’s all, all around the core values. Can you kick

MPD: [00:22:53] those bad actors out?

David Cummings: [00:22:54] We do. There’s been some awkward conversations and some, some challenges that have come from it, but you know, at the end of the day, the culture and the results speak for themselves. Having like-minded people around each other that want to increase everybody’s chance of success has been a winning formula.

MPD: [00:23:14] I been emailing you and change the subject here for a second at your Atlanta ventures email address. And I was confused for a couple minutes because when I was preparing for this and it was on your LinkedIn, I didn’t see it anywhere. Atlanta ventures. But I know I knew you had a website. So I went and looked at it and it looks like it’s a, a holding company of sorts to kind of, we use a lot of the things you’re doing together.

Can you explain how you think about Atlanta ventures, how it fits into your broader playbook here?

David Cummings: [00:23:45] So Atlanta ventures is the holding company that owns the Atlanta tech village real estate. The Atlanta tech village, real estate separate from the Atlanta tech village operating company that operates the building.

And then Atlanta ventures is the holding company for the different investments into companies like Calendly companies, like SalesLoft, which is another unicorn companies like Terminus, which announced a $90 million round just last month. And so Atlanta ventures is the overarching umbrella of. All things startup, whether it’s real estate or operating companies or investments or SPVs or anything related to the startup world.

MPD: [00:24:27] And that’s, it’s your vehicle? All. It’s a one man team. Or do you have an operating staff or how does it

David Cummings: [00:24:31] work? Yeah, we have a great team. We have a staff for the tech village. We have a staff or Atlanta ventures. And so, and then we also have the startup studio. And so the idea behind the startup studio is really to create new ideas from scratch, recruit entrepreneurs, recruit other investors.

And so we’ve started a number of companies over the year and have had a good track record there as well. So not, not too different than, uh, the Mark Peter Davis world of startup life.

MPD: [00:25:01] That’s great. Yeah, there’s a lot of similarities. Can you tell me a little bit more about the Foundry? Is there a particular focus on what you guys build and are you financing them or are you bringing in outside investors?

What, what’s the, um, what’s the construct there? You don’t talk a lot about that.

David Cummings: [00:25:17] So the, the startup studio, the idea is that we create two new companies per year from scratch. Cool. And so it can be anything. Obviously technology is our area of focus. One of the ones that’s making really good progress is called green Z.

So if you go to green z.com and what we’ve done is we’ve taken a lot of the technology that’s been developed over the years for self-driving cars and we’ve applied them to commercial lawnmowers. And so if you think about all the grass. That gets mowed. The grass keeps growing. It’s just a massive market that.

Frankly, it was underserved, right? Robotics has been around forever, but robotics for outdoor maintenance of grass has not been applied. And so we’ve got an amazing team. We’ve got amazing entrepreneur. We’ve got customers that love it, and you can go to green z.com. You can go on YouTube and type in green Z and see the lawnmowers in action.

But it’s an example of something that we came up with as an idea. You know, being in Atlanta, we have lots of grass. We have lots of athletic fields, lots of golf courses. And so it was one of those things. Why, why don’t we see autonomous mowers? Why aren’t they out in the wild? And so that was an example of a startup studio company that we came up with the idea and work to build a great team and raise money from investors both internally and externally.

And we’re off to the races with some, some great pain.

MPD: [00:26:45] Is that a Royal? We. Where it’s, you’re the person coming up with the ideas and putting the pieces together or are there partners in the studio side?

David Cummings: [00:26:55] Yeah, we have partners and we have investors as well.

MPD: [00:26:58] Okay. So you’ve raised outside capital for the studio

David Cummings: [00:27:00] specifically.

We do it just on a per startup basis.

MPD: [00:27:05] Okay. So model is, have idea, put it together with you and your partners, put it together and then you’ll go out and help the entrepreneur raise money. That’s right. Great. And the idea is, are they mainly folks coming to you with the concepts or you guys have a playbook and you’re like, all right, here’s all the ideas we’re excited about.

Let’s go find people to step in and do these

David Cummings: [00:27:25] weekly come up with the ideas internally. So we got a big Google sheet of a hundred ideas, and then we work really hard to find and pair. The product idea with the founder personality. So this fro this product personality fit as a precursor to obviously the goal being product market fit.

And so that’s worked really well for us over the years.

MPD: [00:27:50] And I assume the companies all are all in Atlanta and stay around that’s right after you launch them. That’s right. That’s great. So on that Atlanta, same. Uh, you’re playing so many roles in that the RFE, uh, it’s clear you’re, you’re, you’re trying to construct can ecosystem.

It seems like to me, is there some sort of overarching mission that you’re chasing as you do this piecemeal piece of the strategy means obviously named Atlanta ventures? Um, is there a master plan that you’re building into, or is it opportunistic? How are you thinking about the overarching vision here?

David Cummings: [00:28:23] Sure. So it’s sort of like the old, uh, Rodney Dangerfield where we can’t get no respect from an Atlanta point of view. We’ve got all these great things. We’ve got amazing schools like Georgia tech, which is one of the finest engineering schools in the country. We have a number of success stories, you know, on the generic entrepreneurial side and then specifically on the tech side.

And so our goal really from a community point of view, Is to put Atlanta on the map to be a top 10 tech startup community in the country. I mentioned earlier in the conversation that Atlanta from a Metro region is the ninth largest population-wise in the country and on different stats, whether it’s venture capital raised or, you know, dollar amount of exits, we’re typically in the 12 to 14 range in the country.

And so our goal from a community point of view, Is for Atlanta to per capita punch at or above its weight class. So top 10 in the country for amount of venture capital, top 10 in the country for annual volume, dollar of exits, things like that.

MPD: [00:29:31] I would have assumed you guys were in the top 10, the 12th ranking.

Does that include San Francisco and the Valley as separate entities? Separate

David Cummings: [00:29:40] geography does. Yeah. San Jose is separate from San Francisco.

MPD: [00:29:44] Okay, so that gets you up to 11th. Who else is, who else is punching above you guys? Obviously LA New York. Boston.

David Cummings: [00:29:50] That’s right. But like Seattle, Chicago, Austin, Atlanta has way more people than Seattle does, but Seattle punches above their weight class for obvious reasons.

Right.

MPD: [00:29:59] What are the anchor tenants? One of the things that New York didn’t have 15 years ago that has now are a number of these unicorns that are spitting out talent, more or less, right? They’re training people up. People make money on their stock options. They go out and they start stuff. And then it’s, it’s a bigger narrative around recycling talent, maybe from the top, right?

Where mid-level folks or senior folks become founders. And then they train up the next generation. Who’s doing that now, obviously Calendly. I know that you’re involved with them. Are there a couple of other anchor tenants that are kind of giving birth to the next generation of Atlanta?

David Cummings: [00:30:34] Lana’s actually a FinTech powerhouse.

So back in the seventies, when the federal reserve, basically behind the scenes for the banks, decided that they were going to create a system to do digital transfers of money. It was actually invented at the federal reserve in Atlanta. So now we know it as ACH automated clearing house transfer. So ACH was actually invented in Atlanta by the fed in Atlanta.

And so today, 70% of all credit card transactions across the United States flow through Atlanta. Wow. So the behind the scenes credit card processor. So you think of like Stripe Stripe is really a more of a. Mid-level and a front end processor that then uses the backend rails of other companies and those other companies are based in Atlanta.

So on the FinTech side, Atlanta has a long history, our most prominent example that doesn’t get enough credit as a company called Intercontinental exchange. It’s a $60 billion publicly traded FinTech company started in Atlanta 20 years ago. And it’s actually the company that owns the New York stock exchange.

So a local entrepreneur in Atlanta started a FinTech company and then bought the New York stock exchange several years ago. So the NYC is actually owned in Atlanta, but that’s amazing. Lot of people don’t realize that.

MPD: [00:31:59] So what are the other industries that, um, Atlanta is leveraging to kind of build off for this, this tech hub?

David Cummings: [00:32:06] Another area that Atlanta is really strong as logistics, right? So if you think of Delta airlines, Delta is one of the largest airline companies in the world headquartered in Atlanta. If you think of ups ups, along with FedEx, ups is one of the largest shipping companies in the world. Ups is headquartered right here.

In Atlanta. So everything logistics wise Atlanta’s really strong, you know, Atlanta was formed because it was the intersection of the two main railroads. The railroads that went across the country East to West, and then the railroads that went across the country North to South, they intersected in Atlanta.

And that’s the only reason why Atlanta exists is because of the railroad intersection. But then because of that, you know, when the interstates were built in the fifties, you know, three interstates go through Atlanta. And so logistics, both on the rail and on. You know, the trucks and the interstates, and then of course in the air as well, it all comes through Atlanta.

So logistics is a super, super important part of the economy. And then on the, on the tech startup side, closer to your question. Yeah. You know, sales and marketing near and dear to my heart, obviously, you know, Pardot’s marketing automation software for B2B sales loft is another company that we started as a unicorn doing sales engagement, software MailChimp founded.

In Atlanta, MailChimp does over a billion dollars a year of recurring revenue, all bootstrapped, and it was founded by two Georgia tech guys. And then a number of other, um, you know, email marketing, marketing automation, sales, tech, rev tech is based in Atlanta. So sales and marketing technology has been one of our strengths here for the past 10 years.

MPD: [00:33:52] So, this is kind of a common thread, right? We had David Cohen on from Techstars and Mark’s sister from, um, upfront and they were each more or less part of their motivating strategy was to develop their local community, right. Techstars. They wanted to build out Boulder. Mark is long LA that’s his, his phrase for it.

Uh, and everyone’s Schilling to kind of build their ecosystem, which I think is fantastic. It creates a healthy, competitive dynamic, and I think it helps the whole country and the whole world. What’s the pitch for folks who are debating, where to go for, why they should move to Atlanta for would be entrepreneurs, potential talent.

That would be joining a company when they’re evaluating their options. Why should it land to be their choice?

David Cummings: [00:34:35] So Atlanta is the Capitol of the Southeast. The Southeast of the United States is the fastest growing population center of the entire country by far. Atlanta has one of the best cost of living for a large Metro region, top 10 population wise in the country.

And then Atlanta has the, one of the finest engineering schools in the country that produces. Engineering graduates at scale. Right? So Georgia tech is top 10 academically in every single degree, every single major, every single field of study and Georgia tech graduates, more engineers per year than MIT, Carnegie, Mellon, and Stanford combined.

And Georgia tech graduates the most African-American engineers of any school in the country, Georgia state university, which is based in downtown Atlanta graduates more African-American college graduates than any school in the country. So from a community point of view, We have the fastest growing population center in the entire country.

We have a cost of living for being in a large city. That’s very reasonable and we have the best college graduate pipeline of any region in the country.

MPD: [00:35:57] That’s pretty compelling. What are the reasons not to go there

David Cummings: [00:36:02] or hot? You know, it is the cell, a lot of humidity. And then from a, you know, from a community point of view, it’s just, it’s a different feel.

It’s people are a little happier on average, there’s more of a can-do attitude. People smile more often, you know, it just doesn’t have the, the same hustle and bustle of a New York.

MPD: [00:36:23] That sounds terrible happiness. We’re not into that. Well that

David Cummings: [00:36:25] smile, people that want to see you, people that don’t lower their eyes when you walk by them.

MPD: [00:36:32] What’s the, uh, how do you think the flavor of the startup community there is going to be different? Because I think each region has got a different energy. Is it, is it simply the Southern charm or is there some other dimension that you think is going to develop as Atlanta matures as a tech market?

David Cummings: [00:36:47] Do you think the, you know, Southern charm?

I do think, uh, you know, people come to Atlanta for a great combination of big city amenities. But a little better quality of life. So there’s some trade off there, right? If you’re in finance and you want to be King of the world, you go to New York, right? If you’re, if you want to be a movie star, you go to LA, what do you come to Atlanta for?

Right. There’s really no defining industry in Atlanta. You come to Atlanta because you want a great quality of life because you want. Other people that are balancing ambition and time with their family, you know, it’s interesting. It doesn’t have a clear answer there.

MPD: [00:37:32] What do you think it needs at this point?

You know, there’s a lot of people listening, maybe a lot of the Atlanta folks will listen to this. You’ve built pieces of this ecosystem on your own. That’s not going to scale. What is the city missing? What do you need someone to pick up and do.

David Cummings: [00:37:50] 40 years ago, there was a, an entrepreneur who was jokingly called the mouth of the South, and his name is Ted Turner.

And so Ted Turner created CNN and TBS and TNT movies. And, you know, Ted Turner was the Elon Musk of his day in the media industry. Literally. Took the, you know, the cable satellites and broadcast 24 seven news into our homes with CNN. So 40 years ago, we had the Elon Musk equivalent as our entrepreneur helping put Atlanta on the map.

The thing that we’re missing now is that next generation, whatever industry, it might be tech, hopefully startups, hopefully, but we don’t have that Elon Musk equivalent that Jeff Bezos equivalent. And so that’s an area of opportunity for Atlanta.

MPD: [00:38:43] Okay. So the answer is we need someone to come in and be a big bad-ass and make the magic to a hundred.

There’s not a particular. There’s no

David Cummings: [00:38:52] answer

MPD: [00:38:53] particular industry or the hole in the ecosystem. So you’ve got the base layer of everything going on. Yeah. We need

David Cummings: [00:38:59] that. Stand out. Anchor technology company, whether it’s a Tesla or a Microsoft or Amazon or Google. We don’t have that trillion dollar company let alone that a hundred billion dollar company.

We have some great multi-billion dollar companies. Like the one I mentioned before that owns the New York stock exchange, but you need that combination of mega success and that entrepreneurial personality that likes to grab the mic and make outlandish statements to go with it.

MPD: [00:39:30] Right now we’ve, we’ve seen the Miami folks, uh, do a lot of hand-waving race recently, which I think is great where the PO the political environment is really supporting the growth of the tech ecosystem.

Do you have that alignment in Atlanta are the government officials as excited about this as you are?

David Cummings: [00:39:47] We do the government officials here are super pro-business. Right? So Atlanta is always ranked as one of the top States for. Expanding your business or for relocating your headquarters. So we have a very pro-business climate.

Miami is obviously a little more flashy than Atlanta. So the Miami politicians are more engaging on social media and on national news, you know, from a Georgia. And then from an Atlanta point of view, it’s not the, the same type of emo. So Atlanta and Georgia are very pro-business, but the flashiness is not here.

MPD: [00:40:26] I understand. Okay, I’m going to throw this back to the old days now. You and I met in college. We did long time ago, long time ago, 20 years, 20 years time that happened. Um, I believe at the time we were the only two really entrepreneurially focused folks. On campus at Duke that’s right. I think that’s a safe comment.

I think that’s

David Cummings: [00:40:45] really safe. I think there’s a couple more, but maybe 10 at most literally.

MPD: [00:40:51] And I think of the 10, you were the good entrepreneur and I was one of the many crappy entrepreneurs

David Cummings: [00:40:57] I think he did. All right. I think you’re doing

MPD: [00:40:59] quite a late bloomer. You were blooming in college. Um, when you were starting your first company in college, I remember going to visit your office.

I said in the intro that you built it in your dorm room, but I think that’s only half true. You had a space at downtown Durham. That’s right. Can you give us a little bit of an overview of your journey with Hannon Hill and Pardot? Like how did the first, 10, 15 years go of this, but most importantly, for the folks listening, what did you learn for people who are student entrepreneurs right now?

What did you take away? Cause you navigated it’s so well, relative to most, I had five failed companies in college. And you came out with a company that’s still, uh, scaling. How big is Hananel now 20 years later, we

David Cummings: [00:41:40] now have over 250 colleges and universities as customers today. So still, you know, it’s one of those businesses where, you know, you see a problem for Hannon Hill.

So the, the, the business that Mark’s referring to is a business that does content management software for universities. So this idea of managing your website across dozens, if not hundreds of departments, thousands, if not tens of thousands of web pages, all different types of templates and workflows and approval processes.

And so it’s one of these things that 20 years ago, when, when I started the company, it’s like, Oh yeah, of course, this is a problem. Of course, universities coordinating their content across all the different schools and campuses and departments is, is a huge pain. And so it’s one of those ones where just slow and steady wins the race.

We just kept working hard at delighting the customers and iterating on the product. And we’re still growing nicely to this day, you know, 20 years ago or 20 years later. And so, but, but back to your previous comment, I think from a college campus environment, You know, we were there during the.com heyday, right?

We were, you couldn’t pick up any newspaper without reading about.com. this.com that, you know, I remember my year at Duke, it was the first time ever that the economics major was the most popular major. Historically Duke’s been a place of, you know, pre-med people that would be biology, majors, or law people that would be public policy majors.

And so my year was the first year that econ was the most popular major because people wanted to go to wall street. People wanted to go to, you know, high finance. And so of course that’s changed quickly with nine 11 and the recession and everything else. But you would have thought with the.com day and everything else, the heyday that it would have been more entrepreneurial, but it was still very quiet back then.

And

MPD: [00:43:42] what did you take away through that experience in a specifically advice for. First-time founders, young founders, founders in college, what’s different and unique opportunity or way to do business in that bubble that they should make sure to explore it.

David Cummings: [00:44:00] Well, my recommendation is exactly what you did, right?

You said you had five failures in college. The best thing that an entrepreneur can do is get out there and start doing. I think a lot of would be entrepreneurs spend too much time trying to find the perfect idea. They want to find the perfect. Timing in the market. They want to, you know, do all these things that you just, you just don’t know until you’re out there competing and trying to win business and trying to land customers and try to delight the customers.

So my main piece of advice, my number one piece of advice for entrepreneurs is to just start something. And once you’ve started something. Then so many other ideas will emerge. So many other gaps in the market will emerge. But if you sit on your ivory tower and just try to guess what the market wants, you’re never gonna are rarely gonna figure it out on the first go round.

So I would recommend people do the same thing you and I did, which is just start something, even if it isn’t the most glamorous, even if it isn’t the greatest idea ever, and just start learning and iterating from it.

MPD: [00:45:07] Taking that question and broadening it. So that, that ended up being targeted at first time, entrepreneurs and people kind of navigating this space for the first time.

What’s the advice you’re in a bunch of boards, you’re prolific investor. What’s the advice you find yourself giving to the entrepreneurs you’ve invested in most often. What’s the thing where you’re like, you know, I’m a little bit of a broken record because I’ve said this 15 times this year, but advice that could be helpful to people who are already in the game.

What do you want them to know?

David Cummings: [00:45:35] The only thing that matters is that the customers are happy. Hmm, the only thing that matters. So entrepreneurs love, love, love to get bogged down by what the competitors are doing. Oh, a competitor, a just raised all this money. Competitor B just launched this new feature competitors.

C just open an office in Europe. Entrepreneurs love. To pay attention to the competitors. And so my nagging boring, repetitive thing is the only thing that matters is delighting the customer. And so everything else is noise. So that’s my go-to, it’s all about the customers. Ignore the competitors, ignore everything else, just delight the customers and.

Everything else is noise.

MPD: [00:46:26] I think that’s great advice. I feel like a lot of people who are worried about the press releases from the competitors, forget how large all of these markets are. Exactly. There is so much money to be made if you’re doing a good

David Cummings: [00:46:38] job. I agree. And the best form of marketing is a happy customer.

Happy customer tells, you know, word of mouth marketing, happy customer puts, you know, G2 crowd reviews out there, a happy customer, you know, defends you on Twitter when something goes wrong, because things always go wrong. You know, it’s just part of life, you know, there’s nothing more valuable than a raving fan.

That will go be that testimonial, that lighthouse account that will just tell everybody how great your product or services.

MPD: [00:47:11] My friend you’ve come a long way. The last 20 years, I think you’ve had big impact. You’ve had some business success, but most more importantly, you’ve had a lot of impact. I’m sure in a lot of lives in the Atlanta community, um, probably beyond where do you see yourself in the next 10 years?

Where does all this go?

David Cummings: [00:47:27] I think we’ve got a good thing going here the next 10 years. I’d love to see it. Continue. To develop more startups, more venture capital, more new ideas, created the studio. And so I know it’s a simplistic answer, but it’s been working so well for so long that I’d love to just keep the momentum going and ever bigger ever grander, you know, scales of success.

MPD: [00:47:53] I think that’s not an uncommon response for kind of the, what I would call the 40 year old mindset, which I’m in. As you’ve made your bed usually by 40 and you’re trying to maximize, but you’ve got a bigger story here. Have you thought about, you know, government aspirations, have you thought about mayor, governor?

Is that fit the narrative for you at all?

David Cummings: [00:48:14] No. No interest. My style is as much too introverted. I love just sitting with my ideas and scheming up of what the world should look like. The idea of going out there and glad-handing, and lots of pressing the flesh and playing those different games has no interest to me.

MPD: [00:48:35] Well, you and I are wired the same. Hey David, thank you for making time today. This was fantastic. Hopefully a lot of people benefit from the conversation. I’m hopeful that people in other cities will consider Atlanta and maybe learn some of the best practices that you’ve developed for the city. And build those in their local communities, nothing would be better than a lot of great startup ecosystems, creating jobs.

Thank you for the time,

David Cummings: [00:48:58] Mark. Thanks for having me. I really appreciate it.


You Should Start Your Company In Atlanta | A convo with David Cummings of the Atlanta Tech Village… was originally published in @MPD on Medium, where people are continuing the conversation by highlighting and responding to this story.