Charleston, SC – Startup Market Intel Report
LaunchPad, www.lp.co
2:30pm 3/29/2016
Charleston, South Carolina – Elevator Pitch
Charleston, known as the Silicon Harbor, has a surprising number of growing tech companies across a variety of sectors powered by a workforce with “deep technical knowledge and skills” who are drawn to a “city that mixes lifestyle with culture, history, nature and business.”
When I’m asked “Why Charleston?” for our first Launch Pad expansion, I always say “you’d be surprised at the amount of activity going on there.” For a small city of about 745,000 people in the metro area, Charleston is growing fast — the oft quoted stat is that 48 people move to the city every day. Charleston also has a well developed tech and software economy with a number of successful ventures employing 100+ people, and at least 4 major exits in the last 5 years (see below). As with many of the rising markets that are part of the Launch Pad PITCH, the pieces in the startup ecosystem have catalyzed in the last 5 years with the Harbor Entrepreneur Center, a non-profit accelerator leading the charge with early stage startups, and a number of angel groups that have formed to capitalize on the deal flow. Beyond Cap A Partners and visits by some regional VC’s, there is not major coverage by VC firms, similar to many of the LP:PITCH markets – but the opportunity is here, and companies are closing major funding rounds from out of town VCs.
The rhythm of the Charleston ecosystem is anchored by DIG South, the interactive festival that takes place in April (and unfortunately conflicts with Collision this year, but we’re working on that for next). Active meetup groups like 1MM Cups, Startup Grind, Hatch Tribe Women Entrepreneurs’ Hour and the Vaga coworking pop-ups keep the community connected.
2015 was a watershed year for Charleston with two major exits – PureCar and SPARC. “Over 11,000 people in tech occupations chose to live in Charleston” according to a piece last year in the Huffington Post.
We’re excited to be part of the community and to have Questis, VAGA, and HarborGood representing Charleston at the Launch Pad PITCH April 27th in New Orleans.
Exits & Milestones
- SPARC to Booz Allen Hamilton in November 2015
- BenefitFocus IPO-ed in 2013 and received a $74.7mm by Mercer in February 2015
- OrcWeb exited to Sherweb in July 2014
- PureCars exit to Raycom for $125mm in October 2015
Sectors
- Healthcare tech
- Nonprofit tech
- HR tech / People tech
- Defense / Cybersecurity
- FinTech
- Hospitality tech
- Heavy manufacturing
- Biomedical
- Food / Culinary
Notable Companies
- Blue Acorn – Private – eCommerce agency
- BlackBaud – Public – a leading provider of nonprofit software and services
- People Matter – $63mm raised – workforce management platform
- BoomTown – $20.1mm raised – real estate sales & marketing software
- Echovate – $500k raised – people analytics
- Sparc – Acquired by Booz Allen Hamilton – Full service software development agency
- BenefitFocus – Public – leading provider of employee benefits software and services
- PureCars – Acquired by Raycom Media– online value reports, listing and advertising services on used cars and trucks
- Questis – $2.8mm raised – financial wellness benefit platform
- PhishLabs – $8.2mm raised – corporate cybercrime protection and intelligence software
- Zubie – $19.87mm raised – a connected-car app that provides location sharing and driver scoring services
- Good Done Great – $500k raised – helps companies maximize their corporate social responsibility (CSR) programs
- MarketCube – private – an online sample and research operations company
- Pokitdok – $39.6mm raised – a cloud-based API platform designed to make healthcare transactions more efficient
- Atlatl – $10mm raised – 3D virtualized sales solution that simplifies complex products and streamlines manufacturing
- The New Primal – $1.1mm raised – grass-fed beef jerky snacks
- inKind – $750k raised – enables nonprofits to create more personal and meaningful connections with donors
-
OpenAngler – $500k raised – online reservation platform for chartered fishing excursions
Active Investors
- Cap A Partners – David Mendez runs the only traditionally formed VC in South Carolina
- Third Prime Capital – entreprenuer led investment partnership based in NY & Charleston
- Alerion Ventures – a family office that does venture investing
- South Carolina Angel Network (SCAN) – an affiliation of the leading angel groups in SC & Western NC
- Lowcountry Angel Network – an angel group run by Josh Silverman started in 2015
- Palmetto Fund – a sidecar fund that invests alongside the angel group deals
- Charleston Angel Partners – An angel group led by executive director John Osborne (also head of Harbor Center) started in 2004
- Silicon Harbor Ventures – an investor managed fund targeting investments in micro cap companies
- Twin River Holdings – the angel fund of Gavin McCulley
- SC Launch program – state funded small grant/loan programs to startups as well as subsequent equity funding of up to about $200K
Events
- DIG South – April 26-28, 2016 – Stanfield Gray hosts the South’s interactive festival with 2500 attendees each spring
- TEDxCharleston – October 19, 206 – Charleston’s 2016 theme for TEDx is “Tipping Point”
- Charleston Angel Conference – November 5th, 2016 – a conference for the Charleston angel investment community
Resources
- Charleston Works – a listing of Charleston tech companies
- Charleston Open Source – a guide to relocating to Charleston and companies and resources in town
- Boomtown’s Charleston Tech Map – an interactive map of digital community featuring 10 incubators & 243 companies
- The Tech Life – a podcast by Rich Conte of life in today’s fastest growing technology markets
- Charleston Tech Slack – 500+ members of the Charleston tech community on Slack – dive in!
Accelerators
- Harbor Entrepreneur Center – focused on tech-based businesses, both B2B and B2C
Code Academies
- Iron Yard – 12 week immersive coding classes across back-end, front-end, design and mobile
Workspaces / Coworking
- Launch Pad – workspace downtown for entrepreneurs, professionals and creatives (we’re particular to this one
) - Holy City Collective – coworking and meeting space on Daniel Island
- Harbor Coworking – 4 locations for early stage startups
- Local Works – a nonprofit advocate for local, independent businesses
- Flagship – incubator space for tech companies
- InnoLabs – coworking space in Mt. Pleasant
- Regus – 3 locations of executive suites and coworking
Blogs & Journalists
- Allison Prang – covers business and tech for Post & Courier
- Silicon Harbor Magazine – an online magazine focused on the growing tech scene in Charleston
- Startup Grind Newsletter – newsletter connected to the monthly meetup series led by Jeremy Berman and Daniel Drolet
- Startup Chucktown – a blog run by Jef Lippiatt
- The Pitch Deck – a blog and podcast hosted by angel investor Gavin McCulley
Twitter Accounts to follow
- Startup Grind CHS
- Cap A Partners
- Dig South
- Stanfield Gray
- Harbor Entrepreneur Center
- SC Angel Network
- Paul Swiergosz
- Charleston Open Source
- SCBIZnews
- TechLifePod
- Holy City Sinner
- And of course, trawling the Silicon Harbor Capt. Lil’Bit
- We created a Twitter List to follow these folks and we’ll add to it so follow it here to keep up. (Should we add you? Tweet us @launchpad)
Thank you to David Mendez, Jeremy Berman, Hilary Johnson, Steve Warner and Jef Lippiatt for submitting information referenced in this post.
Leading up the the Launch Pad PITCH we’re taking a closer look at each of the markets participating to learn about the startup ecosystem in each market. I drew the elevator pitch from the responses to the survey, so the quotes are added for direct quotes (kinda like a Zagat guide). We invited the city leader and people in each city to participate in this survey (if we missed something or you have something to add, please submit a response, we’ll keep updating these posts).
