The city of Miami has gone through quite a metamorphosis since the 1980’s, where it first appeared to the nation as the epicenter of crime and drugs. Now, the glitzy tropical city is fast becoming a tech hub, not only in the U.S. but for Latin America as well.
To show off its attraction, in May the city put on a star-studded entrepreneurial event hosted by none other than Miami native Pitbull (Armando Perez) and was attended by some 16,000 entrepreneurs, investors, and business people from over 40 countries.
Miami has no shortage of Latin superstars or venture capitalist to help kick-start entrepreneurial growth. One example is Cuban entrepreneur Manny Medina, who sold his data center company, Terremark, to Verizon for $1.4 billion, and decided Miami needed an ecosystem builder. As a result, eMerge was born, with backing from Medina, Pitbull, Alex Rodriguez and others.
Their efforts and others are beginning to pay off. Miami was one of five metro areas: New York, LA, Houston and Dallas, that accounted for 50% of all startups in the United States in 2017, according to the Economic Innovation Group. In fact, South Florida ranked No. 1 in startup activity in the U.S. as well in 2017, according to the Kauffman Index.
Miami is off to the races, but like so many other cities, there are issues. A study by the Martin Prosperity Institute in 2016 put Miami at 15th in terms of VC dollars, with .98% of the U.S.’s total venture capital investment. Not too shabby. However, the social mood of America is changing. The last several decades have been dominated by Silicon Valley and its cold-hearted American capitalism.
Sociologist Alejandro Portes declared Miami NOT a startup hub, at least not on a global scale, because it doesn’t have top-notch universities. Silicon Valley, New York, Austin, and the research triangle in Raleigh-Durham all have what Miami would like, top-tier higher education.
One cannot ignore the strength that immigration has brought to Miami. Miami-Dade County has a population of 2.76 million. The population has grown 10% since 2010, and 53% of the population is foreign born. Median household income is $43,000. What the counter-culture movement did to San Francisco, the Latin influence is doing to Miami.
As we know, immigrants have a much higher rate of creating start-up businesses than native born Americans. On a larger, more macroeconomic level, Miami, as well as much of Latin America, will be influenced by the Chinese economy. By pouring investment into mobile commerce, China has found another way to dominate where America once held sway. Chinese foreign direct investment in Latin America and the Caribbean has skyrocketed over the last ten years, according to a 2018 report by the Economic Commission for Latin America and the Caribbean. China has invested close to $90 billion in the region between 2005 and 2016. Felice Gorordo, CEO of eMerge Americas paints a positive picture.
“What I believe we all strive for is a hub that offers every entrepreneur with a good idea, who is willing to work hard and do what it takes, to have a fair shot at attracting the capital and talent they need to make it a reality.”