How can Baltimore better support its startup founders? Several told us how

As Baltimore, its surrounding counties and the tech companies throughout the area continue to emerge from the COVID-19 pandemic, questions that preceded the global health crisis still persist. Among them: What do the region’s startups need to reach their highest potential? What cultural and structural barriers stand in their way?

Technical.ly invited leaders from the 2022 Baltimore RealLIST Startups roster and the city’s tech sector to discuss these and other questions about local startups’ future. This led us to a virtual discussion that drew from the forward-looking editorial theme of Web3 month.

Astek Diagnostics CEO Mustafa Al-Adhami, Black Brain Trust cofounder Angel St. Jean, CyDeploy CEO Tina Williams-Koroma, EcoMap Technologies COO and cofounder Sherrod Davis, G-Haven eSports founder Dexter Carr Jr., Sicura COO Arianne Price and Baltimore City‘s director of broadband and digital equity Jason Hardebeck all participated in the conversation.

These leaders principally highlighted four components that, if addressed, would make it easier for startups to grow in Baltimore:

Investing in startups outside of cyber, health and education

People see Baltimore as a place whose tech investors are still largely risk-averse, with only a few industries (healthcare tech, edtech and cybersecurity among them) dominating the tech sector. This presents a problem for folks looking to grow other parts of the tech ecosystem, such as esports.

“If we can fundamentally shift how we think about startups, the ones we fund, how and how much we fund them,” EcoMap Technologies’ Davis proposed. “Just wrapping our arms around [young startups] as an ecosystem and associating our success with their success [can help].”

Hardebeck attributed this risk-averse investment to so much of the city’s local economy being dependent on federal spending.

“There’s a shock absorber that dampens the downside of a tough time,” Hardebeck said. “But it also dampens the upside. We have a lot of fiscally conservative people that it’s hard to get off the sidelines and invest. It’s even harder to get them to invest in things they don’t understand or know about.”

On the bright side, Hardbeck finds that the ecosystem is light-years ahead of where it was decades ago. Baltimore has its own PayPal Mafia of angel investors with Ad.com, whose members are still active local funders.

Bringing awareness to local and in-state companies providing services

Some founders said they struggle to get local, in-state customers. They highlighted initiatives like the Cybersecurity Association of Maryland Inc.‘s matching program with local cybersecurity companies, as well as the Buy Maryland state tax credit for those hiring local cybersecurity companies, that help. Despite these efforts, finding area clients remains an issue.

“That’s the other big part of being able to build and scale an organization: [It’s] not just investment money, but it’s [also] customers [that] get you revenue,” CyDeploy’s Williams-Koroma said. “That has been, and continues to be, a challenge — even in the hot, safe area of cyber.”

Addressing young founders’ issues with the “Smalltimore” network

Participants noted that the idea of “Smalltimore” can be an asset, if wielded correctly. But it can also deter growth, particularly if the existing tech sector networks become insular or exclusive while perpetuating a self-defeating narrative (even if, as several folks observed, this seems to be changing) about the city.

“What is old is new again,” said Hardebeck, who has been part of Baltimore’s tech world since the early 2000s, of this dynamic. He recommends an organization taking up the mantle of bringing Baltimore’s disparate tech communities together.

“We have too many silos still in the startup community,” Hardebeck said. “A lot of it is because the accelerators and the incubators are all competing with each other. There really isn’t someone or something pulling us all together.”

Providing more resources for pre-seed startups

Several founders said that when it comes to building equity principles into its foundations, Baltimore’s tech sector can do something different than other cities. But there’s still a long way to go, and some said that entities like the state-supported TEDCO remain difficult for local founders to navigate.

“There’s an ecosystem as it relates to anyone connected to the universities, but if you’re not coming out of one of those systems, I don’t think the ecosystem is as strong,” said the Black Brain Trust’s St. Jean. “We have to manage every penny to make sure we can stay alive to get to revenue.”

St. Jean recently received a $100k investment from TEDCO, but it was a long process. Hardebeck encountered the same issue back when he was founding companies and looking for funding.

Price, the Sicura COO, offered a prime example of a possible transferrable model that she learned through the Florida-based Tampa Bay Wave. That accelerator brought investors, workers, connectors and vendors like lawyers and accountants together to foster an environment where entrepreneurs could just present ideas. The accelerator helped do everything aftter that, she said.

“It has to start with the investors, and with money and with people being willing to take a little more of a risk,” Price said of Baltimore possibly creating something similar for local founders. “There are companies participating in the accelerator that are not based there [and] who are going to move to Tampa.”

Baltimore is now experiencing something similar, as three Techstars Equitech Accelerator cohort companies plan moves to the region. Hardebeck traced this momentum to earlier changes in the sector.

“Around 2010, 2011, there felt like a real inflection point where the startup community really started to gel,” Hardebeck recounted. “And I think one of the big things that happened is we got out of our own shadow. We stopped trying to be somebody else and started trying to be Baltimore.”