Entrepreneurial ecosystem in Atlanta could use coordination

By Allan Maurer
 
Atlanta has totally changed several times over in the 41 years Sig Mosley, Jr. of Imlay Investments has been doing business in the city.

Sig Mosley, Jr.: “[Startups] underestimate what they need and what it will take to get to the marketplace”

Mosley, one of Atlanta’s best known investors, is among a number of top speakers and panelists at the upcoming Southeast Venture Conference in Atlanta March 2-3.
 
While Imlay is focused on supporting its 37 portfolio companies rather than making new investments now, Mosley says the ecosystem supporting Georgia entrepreneurs is developing steadily.
 
“We have a number of organizations that have begun to help the entrepreneur in various ways,” he says. “New ones continue to pop up.”
 
The groups include Startup Chicks, Startup Lounge, the Angel Lounge, Atlanta Tech Angels, Start Atlanta, Georgia Tech’s ATDC, and groups focused on biotech and medical devices, among others.
 
“I think we’re making progress,” Mosley says. He does see one area that needs improvement though.

Sig will be leading a panel on early stage fundraising strategies at the upcoming SEVC in Atlanta

Better coordination needed

“Eventually, I think we’ll do a much better job of coordinating between the groups. We need to do a better job of figuring that out.” One group recently circulated its suggested calendar of events to other groups to make sure they didn’t conflict with other events, he says. But generally, he notes, “They have a tendency not to coordinate them well.”
 
Atlanta has a number of strong tech clusters, which Mosley expects will remain so. “Internet security has been here for many years and will continue to have a strong presence here,” he says, adding that the same is true for the mobile space.
 
He also notes that biotechnology is doing well. “I don’t look at bio, but everyone I talk with says it is doing well and medical devices are on the uptick.”
 
Green energy companies are evolving in Atlanta and he believes they could evolve into a “center here.”
 
If he were to start investing tomorrow, he says, “I’d still look at mobile and Internet security. But I would definitely look at medical devices. That’s a real opportunity coming along.”

Advice for entrepreneurs headed to SEVC

We asked him if he had advice for entrepreneurs coming to the Southeast Venture Conference.
 
“Do your homework before you come,” he suggests. “Figure out who you want to meet before you get there. People who show up without doing their homework waste a lot of time.”
 
He adds, “If I were an entrepreneur at an early stage company, I would want to know who does early stage investments and what they like. I’d try to meet the right people in that regard.”
 
Having a good attorney or advisors who can help find the right people to talk with and make introductions is a plus, he says. “People may be at a slight disadvantage if they don’t have good advisors.”

Sig feels the social and local deals market that Groupon is in highly over-crowded

Understand your market
 
One area where entrepreneurs often need to do more homework before presenting to investors, he says, “Is that they need to know their market. I’ve told people for years, you can have the best team and the best product, but if you don’t have a market, it doesn’t matter.”
 
Questions entrepreneurs should ask? What do people want to buy? Are people ready to buy? What are their competitors doing and who might become a competitor?

That’s particularly important. “In this day and age, you don’t know when a Google or a Facebook or Microsoft might become a competitor. But you can find out if they are interested in your area and take that into account,” Mosley says.
 
Or, he says, a product may face a dozen competitors – in some cases many more. “Investors will want to know what makes you different.”
 
For instance, the whole social and local deals area that Groupon is in seems over-crowded. “There are one or two local ones here. Why would an investor want to fund a new one?” That, he says, is about the business model and how the company delivers it.
 
Part of understanding a market includes “Understanding the community you are in,” Mosley says. “Atlanta has been more likely to do B2B companies than B2C,” for instance.

Another common mistake many entrepreneurs make, he notes, is “They underestimate what they need and what it will take to get to the marketplace.” So, worried about their equity, they shortchange themselves and raise only $500,000 when they really need $1 million.
 
He warns, however, that people on the East Coast and in Atlanta should keep in mind that valuations tend to be lower on this side of the country than in Silicon Valley. “We’re not the Valley and we’re not going to have the same valuations as the Valley. People need to recognize that,” he says.

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