economy, politics and other factors, guessing what industries will thrive or take a back seat can be difficult.
But to try to get a sense of what to expect in 2019, Richmond Inno talked to local venture capitalists and tech leaders to help gauge what might happen in the coming year. Their answers varied, but they mostly agreed that edtech and food startups will flourish in Richmond, and that startups across all industries in the region will see more early-stage capital start flowing.
Beyond that, the city’s entrepreneurs resist classification, and it will continue to use its diverse startup ecosystem as an advantage. Here are four predictions for the Richmond tech and startup scene in 2019.
Edtech
Photo courtesy of MajorClarity.
Plenty of edtech startups have found recent success in Richmond, surrounded by Virginia’s nationally leading school system, and likely will have big contracts to sign in 2019.
Trilogy Mentors is on track to nearly double the amount of tutoring hours spent on its platform from the previous year, and is looking to secure some growth funding this year. MajorClarity, which launched just two years ago, already is used in 10 states, including 40 percent of school districts in Virginia, and soon will be a household name in the education industry.
Not to mention, the Lighthouse Labs EdTech Cohort last year, its first industry-specific incubator spinoff, helped emphasize the strong edtech community taking shape in Richmond.
Coworking
Richmond may be late to the coworking scene, but last year started to fill up with shared office space. We can’t predict exactly how much coworking space Richmond needs, but new-to-town companies like Novel Coworking, Pinq Inc. and Balance Space will test those waters in 2019.
Local staple Gather is navigating uncharted territory as well, after announcing last week that it will open its first coworking space outside of Richmond – in Norfolk. If it’s successful, look for Gather to continue scaling its brand and extending its geographic reach later this year.
Meanwhile, investors surveyed by Inno are excited for Hatch Kitchen RVA’s first full year in operation, testing whether an industry-specific coworking concept is sustainable. In a city with as many successful food startups as Richmond, the future looks bright for Hatch.
Food Startups
In a state led by the agriculture industry for centuries, it’s no surprise Richmond has its share of food-centric startups – and they’re on fire. Richmond-based Nutriati landed a $4 million equity funding deal, which it’s likely using in 2019 to expand beyond chickpea-based manufacturing and position itself as a more general plant-protein product maker.
Two other food-centric companies will have plenty of money with which to grow this year. Insulated-packaging manufacturer TemperPack last week became one of Richmond’s best-funded startups with a $22.5 million Series B round. And Health Warrior was recently acquiredby PepsiCo as the first member of its Hive division – promising a massive influx of resources for the Chia Bar maker.
“We now have a reputation as a foodie town,” said Scott Ukrop, partner at local VC firm NRV. “And with the national trend towards clean ingredient, better-for-you foods, there’s an opportunity to develop more brands and food products along the lines of Health Warrior.”
Scooters
(Photo via Bird)
Three major dockless scooter and bike startups have placed Richmond on their radar, including Bird, Lime and Jump, but deployment has been sparse as the city decides how to regulate the two-wheelers. City Council is scheduled to decide in January whether the scooters and bikes will be street legal.
In the meantime, both parties have played the hard-to-get game. Bird has frequently put out scooters, which were frequently removed by the city. A lobbyist representing Lime, Ryan O’Toole, told the Virginia Mercury that the startup is excited to work with the city but is “concerned that the mayor’s current proposal, which includes high fees and a low vehicle cap, may keep us out of Richmond altogether.”
Despite the back-and-forth, if the rest of the East Coast’s major metros are any guide, both brands will be ubiquitous in Richmond soon.
Venture Capital
A shortage of early-stage capital is starting to improve after Trolley Ventures was founded in September with a $4 million fund and VC firm NRV deployed some of its $33 million early-stage growth fund. Trolley is planning to close another fund this year.
Scott Ukrop said he’s excited about the “rounding out” of the capital stack in Richmond for early-stage companies.
“With the addition of CVA Angels in recent years and most recently the launch of the Trolley Fund at the seed level of investing, area startups have more formalized stages of early capital … local startups are benefitting from increased communication and funding from across the state with angel groups from 757 Angels in Hampton Roads to Charlottesville Angel Network and Cavalier Angels to a number of Northern Virginia and Baltimore-Washington area angels.”
Look for those investors to deploy more growth capital in the Richmond area in 2019. As for the rest, we’ll have to wait and see.