Startup funding can be a lot like the tide: It rises and then rapidly recedes. Lately, it’s been receding especially fast in the beachy environs of South Florida.
Sun, sand and no personal income tax were among the allures that drew venture investors and founders to Florida after the pandemic disrupted their usual commutes. That influx, plus greater recognition and backing for the state’s homegrown startup scene, contributed to a couple of record-setting years for investment.
To wit, at Crunchbase News, we published a series of articles in the past couple of years highlighting the state’s growing clout as a startup hub:
- In early 2021, we looked at Miami’s rising star among relocating VCs and techies who were firm in their insistence that it was not a retirement decision. Funding to startups in the metro area hit a multiyear high the prior year,
- A few quarters later, we talked about how the hype around South Florida as an up-and-coming startup hub wasn’t just hype. Early-stage funding to the state quadrupled in 2021. Big rounds piled up in sectors from crypto to logistics to health care.
- Things were still pretty heated for much of 2022. That year, we reported, Florida saw the biggest percentage increase of any state in annual venture capital investment.
So that was then.
Now, we hate to put a damper on the party. But the data has spoken. Florida in 2023 is not a growing startup funding ecosystem. It is a shrinking one — with funding statewide receding even faster than it is nationally.
Florida’s quarterly funding drop exceeds U.S. declines
For a sense of how far things are down, we charted out seed through late-stage funding to Sunshine State companies for the past six quarters below:
