Chattanooga Finds Fresh Identity as a Tech, VC Hub

“Weirdly, the pandemic had this silver lining for us,” mentioned Mr. Kelly, a Chattanooga native. “The city kind of fell upwards.”

Chattanooga is without doubt one of the many smaller U.S. cities whose populations grew or held regular final yr, whereas most of the country’s biggest cities experienced deepening population declines as the pandemic continued to encourage Americans to seek for more room, in line with census estimates launched Thursday. As of July 2021, Chattanooga had about 182,000 folks, up barely from July 2020, the census figures confirmed.

The metropolis made early tech investments in 2010 when EPB of Chattanooga, the city-owned energy distribution and telecommunications firm, rolled out a gigabit-speed fiber-optic spine. In 2015, the community was juiced to supply speeds of up to 10 gigabits a second.

Since then, residents of town have been having fun with the velocity: a two-hour, high-definition film, as an illustration, could be downloaded in roughly three seconds, Mr. Kelly mentioned.

Chattanooga has benefited from a rebalancing within the tech trade from main coastal metros to cities throughout the nation, he added. A latest report from the Brookings Institution exhibits tech hiring within the first yr of the pandemic slowed in locations like San Francisco, Seattle and Los Angeles and grew in markets like St. Louis, Philadelphia, San Antonio and Nashville.

Chattanooga has caught a number of the overflow, mentioned

Cameron Doody,

a co-founder of Brickyard, an early-stage enterprise fund based mostly in Chattanooga. As staff from established tech hubs flooded locations like Atlanta and Austin, residents of these cities moved to locations like Chattanooga, he recommended.

“People come here and are like, ‘This reminds me of Austin 20 years ago’,” mentioned Mr. Kelly. “As mayor, I’m now presented with this kind of Goldilocks problem.”

Part of Chattanooga’s development can be attributed to native enterprise capital and startups, he added. Mr. Doody’s Brickyard invests in tech firms from world wide, whose founders then come to intensively work on their product at its headquarters in Chattanooga, the place they’ve entry to a sauna, a steam room, a fitness center and a chilly plunge.

There aren’t any strict guidelines on how lengthy they could keep in Chattanooga and no set schedules for demos, he mentioned.

“When you’re trying to find product/market fit, you just have to put your head down and grind,” mentioned Mr. Doody. “So it’s a space for founders to remove distraction, but not isolate.”

In its first eight months, Brickyard has invested a complete of $3 million into 15 firms that run the gamut from gaming to crypto to logistics, Mr. Doody mentioned. He expects 70% to 80% of the businesses will select to place down roots in Chattanooga in the long term, he mentioned.

Mr. Kelly mentioned Chattanooga doesn’t provide the monetary inducements to maneuver that different cities have, and he as an alternative focuses on fostering a tradition households can thrive in.

Mr. Doody mentioned the shift in the way in which town courts expertise is like shifting from a business-to-business mannequin to extra of a business-to-consumer mannequin. Instead of reeling in “the whales,” or massive firms, it’s now about creating an surroundings that appeals to particular person expertise, he mentioned.

“They can build the right features and solve the right problems in the city that actually matter, and aren’t just convincing some big corporation to move there because you get the perks or the kickbacks,” mentioned Mr. Doody. “That’s great accountability for cities.”

Another objective, Mr. Kelly mentioned, was closing the wage hole within the metropolis by investing in training and nurturing small companies. The metropolis provides free broadband to all college students who obtain free or decreased lunches or Supplemental Nutrition Assistance Program advantages, he mentioned.

Write to Isabelle Bousquette at [email protected]