Ethan Parker, founder, provides insights in a recent interview about entrepreneurship, the evolution of VC investments, and the role Austin plays in the future of tech.
What factors motivated you to take the leap to entrepreneurship in Austin? Why did you choose that city and not another? When did you make the decision to move to Austin and how has the VC and entrepreneurship industry evolved since then?
For me, the decision to move to Austin was personal. I bought a condo in 2006 on Rainey St. and had been renting it out while I was renting in San Francisco.
The cost of living in San Francisco was enough to compel me to move to Austin in 2012.
The leap to entrepreneurship was based on a number of factors including a need for a scalable model PR agency like Treble that could win with seed-stage and Series A stage startups.
Secondly, there was always an attitude of cooperation versus competition in Austin as opposed to what I experienced in Silicon Valley.
Over the past decade, since I originally moved to Austin, the biggest change has been the volume of VCs and entrepreneurs that now call Austin home.
This has created a tipping point that looks to further bolster economic activity and VC investment in the Austin and greater Central Texas ecosystem.
What differences do you see in the VC and tech startup industry in Austin compared to other parts of the U.S. What is your short-medium term outlook on the evolution of this sector?
The biggest difference I see is that Texas is home to a number of multi-billion legacy industries that are ripe for disruption and modernization.
While Silicon Valley tends to focus on 'home run' investments, the investments in Austin often solve real-world problems in vertical industries including real estate, finance, healthcare, cybersecurity, logistics, and more.
The venture funds that 10 years ago were $50M are now $250M, and Austin venture firms are capable of investing full lifecycle from seed stage through IPO.
This definitely gives me a bullish medium-term outlook.
In the immediate term, I believe the deal flow will slow down a bit based on macroeconomic issues and valuations, however, the overall health of the Austin venture market is very strong.
What effect do you think the fact that many large technology corporations are expanding into Texas is having on the Austin startup sector? Is it causing a sort of spillover effect that is motivating the sector to develop?
Large tech companies recognize the lifestyle that Austin offers and it's a new perk.
As we evolve into a hybrid and remote work culture post-COVID, it made perfect sense for companies to invest in establishing primary or secondary headquarters in Austin.
All of this talent migration into Austin ultimately creates a 'trickle down' effect, where there are more and more choices for jobs and more jobs are able to be created and filled.
Anything else you would like to add?
There are a number of homegrown entrepreneurs that have experienced successful exits over the past decade, and those entrepreneurs are choosing to stay in Austin and build new companies here.
This is part of the reason why many investors have a bullish sentiment toward Austin. The city just keeps on winning.