By John Yates & David Calhoun / Corporate Technology Group – Morris, Manning & Martin, LLP

We’ve just completed a strong year for technology companies in the Southeast with the wind at our backs moving into 2017. Our law firm closed more than 50 tech M&A and growth equity/venture capital financings in the last 12 months, so we’ve witnessed a number of entrepreneurial successes in 2016.

Optimistic 2017 for Atlanta/SE Tech — Heading into the new year, the unknowns are greater than ever, but if the momentum continues, it’s realistic to predict another very strong year for technology entrepreneurs in Atlanta and the Southeast. In light of our deep involvement in the Southeastern tech market, we wanted to share with you a series of predictions for 2017.

Here is the first of our Top 5 Predictions in 2017 for the Atlanta/Southeast Technology Community:

Prediction #1: Corporate Investing in Southeastern startups/growth companies will rapidly accelerate

The Metro Atlanta Chamber recently reported the good news that corporate investing in Atlanta tech companies is expected to rise in 2017. The Southeast is home to leading corporations and many have started innovation centers in the region (there are almost a dozen in Atlanta, sponsored by corporate titans such as Microsoft, Southern Company, Home Depot, Panasonic Automotive, ThyssenKrupp, NCR, AT&T, Worldpay, Anthem, Delta, Black & Decker and Kaiser Permanente). These and other innovation centers will be locating close to our region’s leading educational institutions, including Georgia Tech, Research Triangle Park (UNC, Duke & NC State), U. of Alabama-Birmingham, and U. of Florida.

Corporate investing in tech companies is a natural outgrowth of these innovation centers as traditional businesses start their own venture capital divisions. In addition to venture type investments, PitchBook reports that non-tech companies spent nearly $10 billion buying VC-backed startups last year, one the highest totals in the last five years. Many of these traditional businesses are buying tech companies in an effort to compete and attract new tech-enabled consumers. For example, consider these recent deals — Walmart’s $3B+ purchase of web-discount retailer Jet.com, General Motors’ billion dollar acquisition of self-driving tech company Cruise Automation, and Unilever’s $1B purchase of Dollar Shave Club.

Corporate investing provides a “twofer” for the Southeast’s entrepreneurs — capital to finance the tech company along with a pilot/beta and possible future customer. With Atlanta as home to many leading Fortune 100 companies, the city and the region can be expected to benefit from significant increased corporate investing in tech startups and growth businesses.

2017 Prediction: As capital of the Southeast, home to Fortune 100 companies and one of the nation’s leading centers for tech companies, Atlanta will spark a trend among traditional businesses that will focus on our region’s hottest tech companies as targets for investment or acquisition.

UPDATE: As further support to validate this prediction, see Atlanta Top Companies Launch Fund to ‘Engage’ Startups – https://hypepotamus.com/news/engage-venture-fund/

John Yates and David Calhoun are partners in the Corporate Technology Group of the Atlanta law firm of Morris, Manning & Martin. The firm represents leading technology clients and entrepreneurs throughout the Southeast and also hosts the SE TECH Podcast series interviewing leading start-up & fast-growth tech companies in the Southeast region (https://soundcloud.com/setech_podcast)

Contact/Connect:

John Yates: Email | LinkedIn

David Calhoun: Email | LinkedIn

This column is presented for educational and informational purposes and is not intended to constitute legal advice.