Venture capitalists turn Miami into a hub for Israeli startups

"Anyone that comes into town now… from Israel, from all over the world, from New York, from California, if they want to meet somebody in the enterprise technology business and do more meetings, my partner and I...get a call," says Ed Sim, founder of Boldstart Ventures, who relocated his firm from New York to Miami. This anecdote captures the essence of Miami's transformation into a burgeoning hub for venture capital investments and startups, especially those with ties to Israel.

More on Miami conference: Israeli entrepreneurs lead the charge as Miami emerges as a new tech and investment hub

"The other week I was joking with my executive assistant, 'Look, leave two dinners open for me every week because I just don't know who's gonna text me and show up.' And these are some very, very interesting people," Sim humorously describes in an interview with CTech, the frequency of encounters with industry leaders.

Ed Sim.

Sim's decision to establish a presence in Miami was driven by the city's unsaturated enterprise tech market and the influx of experienced investors and entrepreneurs seeking new opportunities beyond the traditional tech centers. This sentiment is echoed by David Blumberg, founder and managing partner of Blumberg Capital, who expanded his firm's operations to Miami in 2020. Blumberg emphasizes the magnetism of Florida's pro-business environment, characterized by the absence of state income tax and a less stringent regulatory landscape.

Both investors acknowledge the significant presence of a vibrant Jewish and Israeli community in Miami, fostering a sense of camaraderie and shared experience that resonates with Israeli entrepreneurs. This cultural synergy, coupled with Miami's appealing lifestyle, reminiscent of Tel Aviv's Mediterranean charm, contributes to the city's allure. “Personally, I think most Israeli tech professionals would enjoy the quality of life in Florida - warm weather, access to water and an active lifestyle similar to Israel,” says Blumberg. “For families, Florida’s primary education is growing and improving in quality. Florida also has no state income tax and less regulatory barriers, which is attractive, especially when starting off in the U.S. or building a startup.”

In November 13-15 2024, Calcalist will host the MIAMI TECH & INVEST CONFERENCE, a tech and innovation conference in Miami, the new technological capital of the southeastern United States. The event will explore Miami's rise as an investment and technology hub, driven by the mayor's proactive support. Panels, lectures, and interviews will focus on the city’s strengths and key sectors, highlighting promising startups. Central to the discussions will be whether Miami can become a viable alternative to San Francisco and Silicon Valley and its future trajectory. Additionally, tech and investment executives from Israel and the U.S. will examine how innovation is applied across various fields, including national defense, cybersecurity, AI, energy, and climate challenges.

Beyond its favorable business climate and cultural affinity, Miami boasts a strategic geographical advantage. Its proximity to both the East and West Coasts, as well as its direct flights to international destinations like Tel Aviv, makes it an ideal location for companies seeking global reach. Florida is home to many industries from banking, finance, and investment to travel and entertainment, healthtech and supply chain and logistics, crypto, aviation and the burgeoning space industry. These industries spin off entrepreneurial ideas and startups. Blumberg Capital portfolio companies or founders (Israeli and local) based in Florida include: Imagene, Theator, Creednz (Israelis), and FirmPilot, Prescient AI, Mytaverse, FlowFi, and Deep Instinct, among others.

David Blumberg.

“The Blumberg Capital team expanded to Miami in 2020 after decades of investing from San Francisco, Israel and New York. The state of Florida is growing as an innovation hub attracting some of the best and brightest from finance, investments and tech to an attractive and flourishing environment. The state’s location and skilled workforce position it well as a center of finance, trade and investment. This is magnified by its pro business, low tax and sensible regulatory approach that is attracting investors, corporations and entrepreneurs,” he says. “New York and Miami both offer access to capital and diverse markets for entrepreneurs. There are strong Jewish communities in both locations. Florida may be safer in terms of personal security in its relative lack of anti-semitic activity.”

According to Blumberg, State and local officials explicitly advocate a pro business stance and follow through with effective governance. “For example, the state has no income tax, has low overall tax rates and approaches regulatory matters with a light touch. K-12 (education for children from kindergarten through twelfth grade) and university ecosystems are growing, improving in quality and flourishing like never before. Florida has adopted a solely merit-based admissions policy for its university system, raising the bar for academic achievement based on standardized tests and grades. Florida schools have been remarkably free from anti-semitic protests after 10/7 and not by accident,” says Blumberg.

Ed Sim is one of the pioneer investors who recognized the potential of Miami at the beginning of the decade, during the Covid-19 pandemic. Sim, founder of Boldstart Ventures, has been active for three decades in "inception investing” - working with founders to help shape and form their new startup. His decision to relocate to Miami was driven by a combination of factors, including the opportunity to build a new enterprise tech scene, the pro-business environment, the strong Jewish and Israeli communities, the good quality of life, and the convenient location.

“I helped build the New York enterprise tech scene. I was part of many people that were there because New York wasn't even on the map. And for me, being an inception investor and being first, I felt that the market got so saturated. So while Covid happened, I saw some of my closest friends founders moving down here, to Miami. I saw investors move down who are all enterprise related. And I just started thinking to myself, like, as every Silicon Valley VC flies into New York, I don't like to be in a place where everyone is, I like to be in a place that's different. And I just said to myself and my wife: why not try something different? Let's see if we can move to Miami and try to help build something here.”

Sim has a long history of investing in Israeli high-tech companies, as demonstrated by his portfolio. He invested in numerous Israeli startups, including Snyk and BigID, from their earliest stages. Sim's interest in Israel dates back to 1999, when he first invested in the Israeli company Guru Net and worked closely with Israel Seed partners.

While Miami's tech scene is still relatively young, the increasing presence of venture capital firms, the growing number of tech-focused events, and the continuous arrival of talented individuals suggest a dynamic shift in the investment landscape. Miami's potential as a major player in the venture capital arena, particularly for Israeli startups, is undeniable, and its future appears bright.

According to Blumberg, the local authorities could do more to make Miami more attractive to venture capital investors. For example he thinks there is still a lot more to do to attract big tech companies, because this would help to create a critical mass of talent and resources, and make Miami a more attractive destination for startups and investors. Also reducing regulations, zoning restrictions and taxes to spur more supply and lower cost of housing, lower insurance premiums through tort reform and reduction of frivolous lawsuits, and aim to build and attract students, as well as research leaders, to Miami universities.

“There's some really fascinating people here. And they all moved to Miami for the same reason: to try to build something, to try to build out an ecosystem, to be a pioneer. It's gonna take 10 years, but I'm excited. The other thing I think that Miami has to offer is it's very pro-business friendly. So Mayor Francis Xavier Suarez is doing a lot around the pro business,” summarizes Sim what is expected to lead Miami in the coming years to establish its position as an international business and high-tech capital.