Sustainable High-Tech Clusters in Georgia
A recent study by STIP researchers Dan Breznitz, Ph.D., and doctoral student Mollie Taylor has revealed the missed potential of Georgia’s high-tech industry and suggests novel policy approaches to rectify it. Based on this research, Georgia Tech’s Enterprise Innovation Institute (EI2) has announced a new dual policy and research endeavor—the Sustainable High-Tech Cluster Initiative (SHTCI). EI2’s Don Betts will be the executive director, with Breznitz serving as academic director and Taylor as lead researcher.
The initiative has four goals:
- Develop a set of policy options targeted at the societal structure of high-tech industry in Georgia, which, initial research indicates, has contributed to the industry’s relative stagnation in growth since 2000.
- Develop different data systems to enable on-time tracking and targeting of the lack of local embeddedness of Atlanta’s high-tech industry.
- Collaborate with industry and state-level stakeholders—such as the Technology Association of Georgia, the Georgia Research Alliance, the Atlanta Technology Angels, and Georgia Tech’s Advanced Technology Development Center, among others—in the creation and sustainment of forums that would allow meaningful long-term interaction between: (a) technology startups, (b) startups and large technology companies, and (c) the technology industry in Atlanta and the rich community of successful major (Fortune 1,000) firms.
- Conduct leading-edge comparative research on high-tech entrepreneurship and cluster development to enable Atlanta to flourish and learn from the vast experience of other U.S. regions, as well as reinforce EI2/STIP as a locus of top-grade academic research on the subject.
Previous research by Breznitz and Taylor has consisted of both qualitative and quantitative analyses of Atlanta’s technology sector, including social networking analysis, interviews, and aggregate industry analysis. Click here for a copy of the report. The findings include:
- Atlanta has all of the factors necessary for a technology company to start and grow: (1) the fifth largest concentration of Fortune 500 firms; (2) a large, educated, young labor market; (3) a diverse population; (4) substantial research universities; (5) high levels of venture capital financing; (6) amenities; and (7) historical good fortune of previous successful technology firms.
- The number of large technology companies in Georgia has steadily declined since 2000.
- The overall growth rates and relative importance of the high-tech industry to the state has stagnated.
- Atlanta suffers from a paucity of technology firms going through an IPO, and currently has no home-grown independent technology company that is a leader in its market niche.
- Furthermore, 40 percent of Atlanta’s high-tech startups leave the city through acquisition or relocation within three years of receiving substantial venture capital investment, a figure that rises above 60 percent within five years.
- Little contact was revealed between technology firms, between technology companies and local Fortune 500 firms, or among executives of prominent technology enterprises.
The research phase of SHTCI starts in January 2010, while efforts to create “buzz” about the initiative and what it hopes to accomplish have already begun. For more information about SHTCI, contact Don Betts ( 912.381.9003 912.381.9003 , email@example.com).