See the original article posted by Maija Ehlinger from Hypepotamus on 8/27/24 here.
The startup world is inherently forward-looking. Investors are searching for the next big thing. Founders are constantly thinking about how to stay ahead of the competition. Pitches and Demo Days focus on what new technologies are set to arrive next on the scene.
From revenue projections to customer acquisition cost (CAC) and lifetime value (LTV), many of the most important startup metrics are all about preparing for and envisioning the future.
The reality is that the fast-paced, forward-looking startup world leaves little time for retrospection. How often do we, as a startup community, look back to understand our origin story?
What even is our origin story?
When we take a step back, we see that Atlanta’s tech startup roots go back more than 125 years. In the late 1800s, companies like Retails Credit (later Equifax) and several telecom companies set the technology groundwork for the growing city. From there, the city grew to become the fintech, software, and communications technology hub that we know today. But along the way, Atlanta’s homegrown technologies did more than just build up the local economy…they became the building blocks of our modern and global digital age.
These are a few names and companies you need to know:
Atlanta’s Hardware And Software Origins
Some of the first true technology startup giants emerged just as mainframes and microcomputers gained in popularity.
Early on there was Management Science America Inc. (MSA). It was one of the first tech companies built in Atlanta to IPO, but it was on the verge of bankruptcy when Georgia Tech graduate John Imlay came in as CEO in 1970. Under Imlay’s tenure, MSA grew to be one of the largest mainframe software vendors, cementing its place in tech history (Imlay’s papers are kept at the Computer History Museum in California). It was acquired in 1989 in what, according to The New York Times archive, was a merging of rivals to the tune of several hundred million dollars.
1970s Atlanta also saw the founding of Peachtree Software, a major early software player in the microcomputer space, and American Software, which was founded by former MSA employees. While American Software started as a sales forecasting platform for the textile industry, it became one of the most important early business-to-business (B2B) software systems and helped lay the groundwork for the city’s strong supply chain industry.
Atlanta Connecting The World
The city’s telecommunication and digital communications talent pool grew in tandem with its software scene. Companies like BellSouth (acquired by AT&T in the 2000s), helped bring a new generation of tech talent to the city. But even back in the 1950s, Scientific Atlanta (acquired by Cisco in 2005) was manufacturing cable television, telecommunications, and broadband equipment. The company also built the technology making video-on-demand possible.
Then there was Digital Communication Associates, Inc. (DCA), manufacturers of Irma boards. That important piece of infrastructure helped connect PCs and Macs to IBM mainframe computers and made it easier for businesses to communicate and share information. The city also had Quadram Corporation, a startup that manufactured expansion cards for personal computers. Hayes Microcomputer, founded by Dale Heatherington in 1981, manufactured modems and made it possible for millions of Americans to get online for the first time. At one point it had over 85% of the market share. Today, almost all modems use a variant of the Hayes command set.
The list of influential companies that changed the way we communicate online goes on. Intelligent Systems, founded in 1973 in Norcross, was instrumental in building early video terminals before the business ultimately moved into fintech in the payments and lending software space. AMI (American Megatrends Incorporated) started in the Atlanta suburbs in the 1980s and is now responsible for the firmware used in approximately 40% of all PCs and 80% of all servers. In 1980, Ted Turner changed cable television with the launch of the first all-news network in the US, CNN, from its Atlanta studios. Mindspring, an internet service provider started in the 1990s that ultimately merged with California-based Earthlink, which helped lay the groundwork for our modern communication systems. WebMD, founded in Atlanta in 1997, changed how people think about communicating health topics.
Securing Our Digital World
From Atlanta’s hardware and software roots, cybersecurity was a natural next industry. And the early cybersecurity industry leaders in town will be familiar names to many, as their companies would go on to create a more robust, secure digital world. Marc Gorlin co-founded email and data encryption software PGP Corporation before building Kabbage and Roadie in the fintech and supply chain spaces.
Perhaps the most prolific names in cybersecurity, Jay Chaudry, founded Secure IT (acquired by VeriSign), CipherTrust (acquired by Secure Computing / McAfee), and AirDefense (acquired by Motorola) in Atlanta before building the security giant Zscaler in the Bay Area.
Companies like SPI Dynamics (acquired by HP in 2007), Christopher Klaus’ ISS (acquired by IBM in 2006 for $1.3 billion), and Airwatch (acquired by VMware in 2014) helped Atlanta stake its claim as a cybersecurity hub.
Building The Flywheel
Slowly, outside companies like Manhattan Associates and NCR relocated their headquarters to the Metro Atlanta area to take advantage of the region’s growing tech talent pool. Such relocations were part of helping to build the local tech “flywheel,” as talent development, company successes, and external investments drove further growth in the tech sector. Over the decades, employees who cut their teeth at companies like MSA, Scientific Atlanta, Peachtree Software, ISS, BellSouth, Mindspring, and AirDefense built countless local fintechs, cyber startups, healthcare ventures, and software giants.
That flywheel would grow as local talent continued to invest in the next generation of entrepreneurs in town. Sig Mosley, who was with MSA for decades, grew to be the “Godfather of tech investing” in Atlanta and has been building up the next generation of early-stage companies. Other tech leaders in town, like David Cummings, have not only invested in startups, but also gave countless early-stage founders their first office space with Atlanta Tech Village. ATV, located on a popular Buckhead intersection, has become a central meeting point for the local startup community over the last decade.
Mapping Tech History
Years ago, the Atlanta ecosystem worked to write out its local history, showcasing just how quickly a few companies sprouted a dynamic ecosystem. A fan chart, developed by leaders across the local tech scene, helped people track the origins of the local technology scene back to the 1890s. It was a community effort to put together, said John Yates, Partner at Morris, Manning, and Martin. Yates showed Hypepotamus the chart and walked us through the moments he sees as pivotal in the history of Atlanta technology. Today, it is hard to imagine how many more layers that fan chart has added with new startups success stories.
The startup scene weathered recessions, funding droughts, and the Dot Com boom and bust. It built several unicorns. It has attracted new talent and lost talent to more established places like Silicon Valley, Boston, and New York because of lack of later-stage capital.
By taking a moment to pause and look back at Atlanta’s tech history, we can start to see exactly why the city became known not only as a software, fintech, and cybersecurity hub, but also as a foundational city in building the modern computer age. Giants like Coca-Cola, The Home Depot, UPS, and Delta Air Lines certainly put the city on the map as a business hub. But turn back the clock a few decades and you’ll see that at its core, Atlanta has a long history as a startup city.