Recently ranked second in the nation for new startup activity, Miami is experiencing a surge in startup and entrepreneurship and shows no signs of slowing down. The tropical lifestyle and proximity to Latin America is turning the South Florida city into a hub for global startup activity as well as a strategic destination for any business that connects or operates across the Americas.
If your Latin American startup has its sights set on expansion into the US, or if you’re already in the US and targeting Latin American markets, here’s why you should consider placing Miami at the top of your list.
Community support for startups is booming
From accelerator programs to co-working spaces, the city is enthusiastically embracing its surge in startups selecting Miami as their home base. The city’s access to Latin American markets is also increasingly attractive to startups both Miami-based and from around the world. Last fall, 500 Startups, one of the largest venture capital seed funds and accelerator programs in the world, chose Miami for a 10-week marketing program. They invited startups from South Florida, Latin America, or elsewhere that wanted to target the Latin American market or U.S. Spanish-speaking market, to meet with the organization’s staff and mentors and offered participating startups significant funding.
In recent years, many accelerator programs have also emerged and taken the Miami tech scene by storm. Venture Hive, Endeavor Miami, Rokk3r Labs, and TECKpert are just a few of the notable incubator and accelerator programs in the area. Co-working spaces are also a plenty, with The LAB Miami, Pipeline Brickell, MiamiShared, MEC261, Miami Innovation Center, Büro, and Right Space 2 Meet topping the list.
To be an attractive technology hub, a city needs the support of local angel investors and venture capitalists, and the Miami community is diving full-force into providing that support. Last year, venture capitalists invested $651.6 million in Miami area startups. The number of early-stage technology VC firms setting up in South Florida is also on the rise. Scout Ventures, a top 100 VC firm based in New York, recently expanded their growth with an office in Miami aimed at investing in up-and-coming companies; specifically those between their angel and Series A financing rounds.
Lower operating costs
The cost of living in Miami is much lower than most of the other popular tech hubs in the United States. The average monthly rent for a one-bedroom apartment in Miami is about $1,557, compared with $3,313 in San Francisco and $2,993 in New York City. Furthermore, Florida has a very favorable tax structure for new companies just starting up. No state income tax means your startup can keep a larger percentage of your assets.
Latin American startup success stories
If the above reasons aren’t enough, there are plenty of startup success stories coming out of the region. Open English, an online learning platform that helps non-English speakers learn the language, was founded in 2006 by Andres Moreno in Venezuela. He then took his idea to Miami in 2008, raised $116M to launch the program commercially, and it has since flourished. Today, the startup employs 1000+ with offices in Miami as well as Central and South America.
YellowPepper, a Latin American tech company that provides mobile banking and payment solutions in the region, is another great example of how startups targeting Latin American consumers can successfully operate out of Miami. After launching in the United States, the startup struggled to gain ground. The company realized US consumers were slow adopters of mobile payments because of the numerous other channels available to access their accounts.
Serge Elkiner of YellowPepper - Navigating the Miami Startup Ecosystem
Instead, the startup set its sights on Latin America and now has over 80 employees and operates in six countries. On the heels of its success in Latin America, the firm moved its headquarters to Miami, brought their total funding to $33 million, and now enables over 4 million customers to execute around 25 million transactions per month, according to their website.
Miami is the gateway to Latin America and its importance in the global startup scene is only on the rise. The city is actively seeking Latin American startups and has many advantages over the already established tech hubs in the US. So if your startup is ready to make the move, consider this welcoming, innovative city first.