If you live in Florida, you know New York is headed your way. Last year, more than 60,000 New York residents turned in their New York drivers’ licenses for new ones that carry a Florida address.
Major financial firms lead the exodus. Tech firms are following. Taxes often are cited as the main driving force for the moves, as well as the ever-elusive improvement in people’s “quality of life.” In other words, people like the beach.
A keynote panel at ITEXPO 2022 in Ft. Lauderdale, FL tackled the issue of Florida’s transition to a fintech center of business.
Rich Tehani, CEO and group publisher at TMC, served as moderator for the discussion. He was joined by three professionals who know the south Florida tech-startup scene like the backs of their hands.
Nikki Cabus runs south Florida’s largest tech incubator. As CEO of South Florida Tech Hub, part of her job is to entice start-up tech firms to choose south Florida for their home base.
“South Florida is the number one place where people from the Big Apple come to,” Cabus said. “Palm Beach County is being called the Wall Street of the South.”
“It’s not just New York,” Tehani said. “New Jersey is the same thing.”
Tahl Milburn, head of venture capital firm Seedfunders, sees a permissive business environment as the region’s biggest attraction.
“The biggest asset is the lack of regulation,” Milburn said. “In California, you can’t step sideways without breaking a rule.”
People want to live in south Florida, said Mark Volcheck, president of venture-capital firm Las Olas Ventures. Now they can start their business there too, he said. Volcheck agreed that the high quality of life in south Florida is the main reason people choose the state for their companies.
“People just explain it by saying taxes,” he said.
“We’re spoiled with work/life balance,” Cabus adds, noting she recently was offered an out-of-state opportunity, but her husband brought her back to reality by pointing out that “we basically live on an island surrounded by beaches.”
“We live where other people go on vacation,” Cabus said.
Growing pains are evident, though, Volchek said: “Housing has become very expensive and I think there’s going to be problems with that.”
“I do think we’re going to see a shakeup in crypto and fintech technologies, just like in 2000,” Volchek added. “There has been too much money invested in technology that doesn’t make sense.”
Cabus noted that Florida doesn’t provide as many financial incentives for companies to relocate compared to other states.
“We’re spoiled with the work life balance,” she said.
Maybe too spoiled, according to Volcheck. He said he’s heard of development teams that have struggled because they enjoyed themselves too much. “I think the balance is going to swing back toward the office,” he said.
Attracting talent is a challenge, Cabus said. Bootcamps can help, but Milburn noted that south Florida lacks a major university ranked highly for producing tech graduates. The shortage of tech professionals is a national issue, though.
“You can’t get a developer to come to your office,” Milburn said. “You just can’t find certain job unless they’re remote.”
Tehani asked the group where they think the fintech move to south Florida is headed.
“If it’s blockchain related, they’re asking ten times too much,” Milburn said. “They’ll find it from somebody.”
Recent PE ratios experienced by fintech companies are gone, Volchek said.
“One-hundred times earnings feels like ancient history,” he said. “There really were no underlying fundamentals for it.”
With the recent market correction, Volchek believes that scenario has flip- flopped. Public tech companies are a buy, he said:“They’re really trading below value and are a good buy today.”
“PE ratios are stupid low,” Milburn agreed, who thinks technology stocks will rebound by the end of next year.
Whatever happens, the group expressed belief that south Florida’s status as a technology hub is only going to grow.
“We’re the gateway to Latin America,” Cabus said. “We’re one of the most diverse places in the country.”
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