Tech Talent Flocks to Smaller Cities, But Investors Aren’t
Welcome to Equity: The Venture Capital-Focused Podcast
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines. This week’s show took a break from regularly scheduled programming. Our co-host Alex Wilhelm, who usually leads us through the show, was on some much-deserved vacation, so Danny Crichton and Natasha Mascarenhas took the reins and invited Floodgate Capital’s Iris Choi to join in on the fun.
A Veteran Guest
It’s Choi’s fourth time being on the podcast, which officially makes her our most tenured guest yet (in case the accomplished investor needs another bullet point on her bio page).
This Week’s Docket
This week’s docket features scrappiness, a seed round, and a Startup Battlefield alumnus. Here’s what we chewed through:
LeverEdge Raises Seed Funding for Student Loan Discounts
LeverEdge raised seed funding to get you and your friends a volume discount on student loans. Fintech has been booming for years now, and startups often crop up around the painful world of student loans. Yet this startup still caught our eye, and it has a little something to do with its choice to use collective bargaining power as its modus operandi.
Stackin’ Raises $12.6 Million Series B for Fintech App Marketplace
Stackin’, a text-messaging service that connects millennials to money tips, and eventually other fintech apps, raised a $12.6 million Series B. According to CEO Scott Grimes, Stackin’ wants to be the ‘pipes that port people around fintech.’ We get into if the world needs a fintech app marketplace and how it targets younger users.
D-ID Raises $13.5 Million for Digital De-identification
D-ID, a Startup Battlefield alumnus, digitally de-identifies faces in videos and still images and just raised $13.5 million. We’re all worried about our privacy concerns, so the funding news was a refreshing change of pace from the usual headlines we see around surveillance. Now the company just needs to find a successful use case beyond the goodness in people’s hearts.
ByteDance Hits $3 Billion Net Profit
ByteDance, the Chinese parent company that owns TikTok, hit $3 billion in net profit last year, reports Bloomberg. TikTok also recently snagged former Disney executive Kevin Mayer for its CEO. This one, as you can expect, made for an interesting conversation around privacy and bandwidth.
Regulating Social Media
We even asked Choi to weigh in on Donald J. Trump’s recent tweet threatening to regulate social media companies, as Floodgate was an early angel investor in Twitter.
The Future of Work: A Roundtable Discussion
We ended with a roundtable of sorts on how the future of work will look and feel in our new world, from college campuses to offices. We get into the vulnerability that comes with being on Zoom, the ever-increasing stupidity of ‘manels,’ and how tech talent might be flocking to smaller cities but investors aren’t just yet.
Tech Talent Flocks to Smaller Cities
According to recent trends, it appears that more and more tech talent is moving away from larger metropolitan areas in favor of smaller cities. However, despite this shift, investors seem reluctant to follow suit. There are several reasons for this reluctance, including a lack of understanding about the benefits of investing in smaller cities, concerns about scalability, and a preference for proven markets.
Benefits of Investing in Smaller Cities
Smaller cities offer numerous benefits for tech startups and investors alike. For one, they often have lower costs of living and doing business, making it easier for startups to scale without breaking the bank. Additionally, smaller cities tend to have a more collaborative and supportive community, which can be beneficial for founders who value mentorship and networking opportunities.
Challenges Facing Investors
Despite these benefits, investors face several challenges when considering investing in smaller cities. One of the main concerns is scalability. Startups in smaller cities may not have access to the same level of resources or funding as those in larger cities, making it harder for them to grow and expand their operations. Additionally, investors may be hesitant to invest in a market that they don’t fully understand.
Why Investors Should Consider Smaller Cities
While there are certainly challenges associated with investing in smaller cities, the benefits far outweigh the costs. By investing in smaller cities, investors can tap into a growing pool of talent and innovation, while also supporting the local economy and community. Furthermore, startups in smaller cities often have a unique value proposition that sets them apart from their larger city counterparts.
Conclusion
In conclusion, tech talent is flocking to smaller cities, but investors aren’t just yet. Despite the benefits associated with investing in smaller cities, including lower costs of living and doing business, scalability challenges, and a preference for proven markets are holding investors back. However, by understanding the benefits of investing in smaller cities and taking steps to mitigate the risks, investors can tap into a growing pool of talent and innovation.
About Equity
Welcome to Equity, TechCrunch’s venture capital-focused podcast. Each week, we bring you the latest news, trends, and insights from the world of venture capital, with a focus on startup funding, M&A, and IPOs. Join us as we explore the intersection of technology and finance, and discover what’s next in the world of startups.
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