Keith Rabois, managing director of Khosla Ventures, was having dinner with a “highly successful CEO” in October 2018 when the CEO asked him a question: How many people does it take to create an entirely new Silicon Valley? 10,000? Or 100,000?
Unbeknownst to LaBois, he decided to accept the challenge and began working to make Miami the next Valley.
And despite other big investors like Andreessen Horowitz pulling out and closing their offices in Miami just two years after setting up shop there, LaBois said he remains bullish on the South Florida city.
Speaking at Primary Venture Partners' New York summit on Thursday, Lavois claimed that 11% of all US seed investment comes from Miami, “up from basically zero,” and he would like to see that rise to 20%.
But seed investments in Miami startups account for just 2.6% of total U.S. seed investment so far this year, and 3.5% in 2023, according to PitchBook data.
“If you care about the future of technology, here's a statistic to look at: [the] “It's a tiny fraction of the seed investment, but where is it happening?” Lavoie said, adding that later-stage investments don't reveal much about the future of a technology.
Rabois also said Khosla Ventures is preparing to invest in a fifth Miami-based company that will “reinvent education,” but declined to provide details.
In April, Khosla and Founders Fund, where Lavoie worked until January 2019, led a $150 million investment in spend-management startup Ramp. Lavoie said New York-based Ramp also has an office in Miami, which adds to the city's appeal.
LaBois said he believes it takes work to build a new tech hub, which is why he's active on X/Twitter and promoting Miami as a great place for founders. He added that he wants founders and investors to know that there is opportunity in a vibrant city where they don't wake up every day fearing “assault or abuse,” an obvious satire of San Francisco's homelessness and opioid epidemic.
While LaBois still believes in Miami's future as a tech hub, he hasn't completely abandoned San Francisco, and reportedly spends about a quarter of his time at his home there.
As an aside, LaBois said he supports Daniel Lurie, a candidate for San Francisco mayor, who has taken a tough stance on tackling the opioid crisis.
“To build a tech ecosystem, you need angel investors. You need founders. You need Series A investors. You need a variety of skill sets within a company: engineers, designers, business people, salespeople. It's really hard to start an ecosystem,” he said. “That's why evangelism is so important.”
Update: This article has been updated to provide more information about the percentage of total seed investment in the U.S. that went to Miami startups. This article was originally published on September 12, 2024 at 12:37pm PST.