Atlanta is coming up in the tech world with several newly minted billion-dollar businesses hailing from the ATL and the city’s local venture capital community is taking notice.
Even as later stage firms like the newly minted BIP Capital rebrand and with increasingly large funds, earlier stage firms like Tech Square Ventures are staffing up and adding new partners.
The firm’s latest hire is Vasant Kamath, a general partner who joins the firm from Primus Capital, a later stage investment vehicle based out of Atlanta. Before that, he was managing investments for the private office of the Cox family.
Originally from Augusta, Ga. Kamath left the south to attend Harvard and then went out west for a stint at Stanford Business School.
In between his jaunts North and West Kamath spent time in Atlanta as an investment banker with Raymond James in the early 2000s, the beginnings of a lifelong professional career in technology. Before business school, Kamath worked at Summit Equity Partners in Boston investing in later stage technology companies.
Kamath settled in Atlanta in 2010 just as a second wave of technology companies began making their presence felt in the city.
The new Tech Square Village general partner pointed to Atlanta’s underlying tech infrastructure as one reason for the move to early stage. One pillar of that infrastructure is Georgia Tech itself. The school, whose campus abuts the Tech Square Ventures offices, is one of the top engineering universities in the country and the breadth of talent coming out of that program is impressive, Kamath said.
There’s also the companies like Airwatch, MailChimp, Calendly and others that represent the resurgence of Atlanta’s tech scene, Tech Square Ventures’ newest general partner said.
Not only are young companies reinvesting in the city, but big tech giants and telecom players like T-Mobile, Google, and Microsoft are also establishing major offices, accelerators, and incubators in Atlanta.
“There’s a lot of momentum here in early stage and i think it’s building. It’s the right time for a firm like TSV to take advantage of all of the things,” Kamath said.
Another selling point for making the jump to early stage investing was the relationship that Kamath had established with Tech Square Ventures founder, Blake Patton. A serial entrepreneur who’s committed to building up Atlanta’s startup ecosystem, Patton has been the architect of Tech Square Ventures’ growth through two separate initiatives.
In all, the firm has $90 million in assets under management. What began with a small pilot fund, Tech Square Ventures Fund 1, (a $5 million investment vehicle) has expanded to include two larger funds raised in conjunction with major industrial corporate partners like AT&T, Chick-Fil-A, Cox Enterprises, Delta, Georgia-Pacific, Georgia Power, The Home Depot, UPS, Goldman Sachs, and Invesco, under the auspices of a program called Engage. Those funds total $54 million in AUM and the firm is halfway toward closing a much larger second flagship fund under the Tech Square Ventures name with a $75 million target.
All this activity has led to a blossoming entrepreneurial community that early stage funds like Tech Square Ventures hopes to tap.
“We see a fair number of folks from these large corporations spinning out and starting things themselves,” said Kamath. “For a decade plus, you have multiple entrepreneurs doing really well and increasing acceleration in terms of climate and exits.”
And more firms from outside of the region are beginning to take notice.
“I think that is happening,” said Kamath. “You might seen investment from outside the region. At the seed stage it’s harder you do need to have feet on the ground right when they’re starting and building their business. Once they’ve been vetted and had that early round of investment you will definitely see a lot of activity. We’re seeing more investment at the Series A and B from out of town. That’s the strategy.”
It all points to a burgeoning startup scene that’s based in a collaborative approach, which should be good not only for Tech Square Ventures, but the other early stage funds like Atlanta Ventures, Outlander Labs, BLH Ventures, Knoll Ventures and Overline, that working to support the city’s entrepreneurs, Kamath said.