Startups at the Advanced Technology Development Center (ATDC), the state of Georgia’s technology incubator, raised more than $114.3 million in investment capital in 2018.
While the activity represents a slight decrease from the year-end 2017 figure of $140 million, it reflects the general investment trend nationally for 2018: Even though the deals made were larger, fewer deals were done overall.
When ATDC program graduates’ capital raises for the year are included — $380.8 million — the total amount of money that came to Georgia technology companies with ties to the incubator is $495.1 million.
“Our current portfolio and graduate companies really made a difference in Georgia’s deal flow activity in 2018, because of the roughly 100 deals that were done in the year, 68 of those were ATDC companies,” said Brad Schweizer, ATDC investor relations manager. “That’s nearly 70 percent of all the Georgia deals and it speaks to the quality and caliber of companies that we have in our portfolios.”
In addition to the $114.3 million in capital funding current ATDC portfolio startups received from investors, they garnered an additional $8.4 million in non-dilutive funds from federal grant awards in 2018.
That’s nearly triple the amount received in 2017.
“This is significant because these federal grants and awards are extremely competitive for companies that are still refining and verifying their research and technologies,” said Connie Casteel, ATDC’s program manager for grant awards and funding.
Key to ATDC’s continued success with its portfolios is its Investor Connect program, which curates meaningful interactions between the startups and investors.
That, along with programming that prepares the startups for successfully raising money and make long-term connections with investors, is a critical component of why Investor Connect has been so successful, Schweizer said.
In 2018 the program strategically curated more than 500 connections with introductions to more than 250 different venture capitalists and angel investors.
“Introducing our companies to the investor community and making meaningful connections is our core focus,” Schweizer said. “Through our events and meetings with the venture capitalist firms such as our yearly ATDC Venture Showcases on the East Coast and West Coast and our ATDC Startup Showcase, investors continue to see as a critical and trusted partner for deal flow with high-growth startups for their firms.”
Among those investors is Fort Lauderdale, Florida-based Las Olas Venture Capital. The firm, which has more $30 million in assets under management, was the lead investor in the $4.5 million seed round of DEVCON, an ATDC portfolio company whose proprietary cybersecurity software technology helps media publishers maximize advertising revenue by identifying and eliminating fraudulent ads within their networks.
Las Olas Venture Capital also was the co-lead investor in Cypress.io’s $4 million seed round.
Cypress, another ATDC portfolio company, provides front-end automated software testing for anything that runs in a browser.
“What ATDC does well and what makes it different from other programs is the entrepreneurial fabric that makes up ATDC,” said Esteban Reyes, one of Las Olas Venture Capital’s founding partners. “You have former CEOs and founders in the equation at ATDC, working and engaging with the startups in the program in ways that are useful and practical for those startup founders.”
Las Olas focuses its investments mainly in companies that are business-to-business and creating the next generation of enterprise technologies.
DEVCON, Reyes said, is in a sector with a $40 billion opportunity, while Cypress has a $20 billion opportunity.
The two companies, he said, reflect another strategic difference with ATDC in that the incubator, which is a program of the Georgia Institute of Technology, focuses on leveraging Atlanta’s strengths to build successful technology companies.
“ATDC and Georgia Tech are taking a long-term view with their strategic focus to turn Atlanta into a major tech hub,” Reyes said. “They’re looking at the key levers that Atlanta has to its advantage and pulling those levers.
“There’s a trifecta here of new startup founders, ATDC’s team of experienced entrepreneurs, and Georgia Tech’s technical student talents. ATDC has found the right way to engage those three stakeholders and provide them with a platform so they can be collaborative and productive, which is very unique.”
The Advanced Technology Development Center (ATDC), a program of the Georgia Institute of Technology, is the state of Georgia’s technology startup incubator. Founded in 1980 by the Georgia General Assembly which funds it each year, ATDC’s mission is to work with entrepreneurs in Georgia to help them learn, launch, scale, and succeed in the creation of viable, disruptive technology companies. Since its founding, ATDC has grown to become one of the longest running and most successful university-affiliated incubators in the United States, with its graduate startup companies raising $3 billion in investment financing and generating more than $12 billion in revenue in the state of Georgia. To learn more, visit atdc.org.
About ATDC Investor Connect
ATDC strategically matches its portfolio companies to capital through curated investor interactions. The investor relations manager is available for consultations to help companies develop a focused funding strategy. In addition, the manager works with the incubator’s coaching staff for funding preparation. The outcome creates exceptionally engineered investor readiness, resulting in high value deal flow for investors. For more information, visit atdc.org/how-we-help/capital.