Fintech: Southeast News

Fintech Southeast News curated each weekday for Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina, and Tennessee

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Posted May 21, 2021

Encouraged by a cryptocurrency-friendly mayor, Miami is generating considerable buzz as a burgeoning technology hub, and local attorneys who work with startups and financial technology companies say they're fielding a lot of phone calls.

Mayor Francis Suarez has been aiming to bring technology startups and investors to Miami, and he's been particularly bullish on Bitcoin. Southern Florida has seen a string of high-profile arrivals over the last year, including the likes of Peter Thiel's Founders Fund, billionaire activist investor Carl Icahn's Icahn Enterprises, and Blackstone, which is working to open a technology office in downtown Miami.

It's not clear whether Suarez's Bitcoin proposals will come to fruition, or how permanent a tech migration to Miami could ultimately be. But entrepreneurs and investors are paying attention to the recent spike in interest, attorneys said. Here, Law360 takes a look at some of the reasons Miami could flourish as a fintech hub, as well as what challenges still remain.

Southern Florida has an existing startup scene as well as plenty of draws for new arrivals — the area has sunshine and no state income tax, local academic institutions supplying engineering talent, and, as Velvel Freedman of Roche Freedman LLP noted, an "efficient and excellent" court system.

The city also serves as a gateway to Latin American markets, said Sean Burstyn, a solo practitioner at Burstyn Law Firm PLLC.

"It's Little Cuba," said Burstyn, who is Cuban-American. "[Cubans] turned the city into a startup city in the pre-tech era, and that 'immigrant story' energy has never left. What we're seeing now is the overlap of that energy with technology."

{mprestriction ids="1,4,9"}While much of the evidence for a tech migration is anecdotal, there seems to be no shortage of stories. Many attribute the recent interest at least in part to Florida's COVID-19 response.

Burstyn, who initially set up shop in New York, said his young firm "used to get calls every couple days from startups asking me to help them incorporate and raise money in [Manhattan neighborhoods] SoHo or Chelsea," Bursytn said. "When COVID-19 started, that was almost completely replaced by the same clientele asking me to help them get started in Miami."

Tim Shields, a Kelley Kronenberg partner in Fort Lauderdale, agreed that looser restrictions during the past year have been appealing to individuals and to businesses alike.

"Florida's COVID-19 response has driven several tech companies I know that were based in the Northeast to Florida because they were more open," Shields said. "Regardless of political persuasion, people would rather be able to go out and eat out dinner than not."

The influx of capital and entrepreneurs could provide a crucial accelerant to Miami's startup scene. Shawn Amuial, a Miami-based associate at Holland & Knight LLP who focuses on commercial real estate and blockchain, said he can see Miami developing into the sort of startup scene that's present in Austin, Texas, or that's incubating in Nashville, Tennessee.

"We were missing for a long time a very strong network of tech startup entrepreneurs and the venture capitalists that invested in those startups," Amuial said. "It would have taken a long time for South Florida to catch up without COVID-19, but because of COVID-19 those entire networks from Silicon Valley and to a certain extent from New York City as well just picked up and came here."

"Whether it's temporary or permanent I think is to be determined, but it jump-started the ecosystem," he added.

 

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