The knock against Washington DC as a tech hub has always been that it was too much of a government town: risk-averse, slow-moving, not worried enough about the bottom line.
But a lot has changed in the last 15 years, since people started trying to seed the culture of technology innovation outside Silicon Valley. Washington DC got a lot richer, for one thing.
Four of the 10 wealthiest counties in the country are in the DC metro area, as are the two very wealthiest – Falls Church and Loudon.
And the government itself became less and more powerful: The democracy grew weaker and the regulatory system in the hands of big companies that have captured much of it grew stronger. I took a look at my home-town ecosystem as part of a series looking at legacy cities and other second-tier markets.
Today, there is a tech hub growing in Washington, D.C., fueled by the wealth of the suburbs and partly built around that new government system. Pitchbook recently ranked the city 5th among startups, ahead of Austin and Seattle (and behind Silicon Valley, New York, Los Angles and Boston). Washington D.C. tech unicorns include ID.me and and Rebellion Defense (a military software provider), Pitchbook notes.
K Street Capital, which includes a $15 million venture fund and a $25 million fund of funds, invested in ID.me. Paige Soya, K Street’s managing partner, was a founder herself before beginning a career as an investor. There’s a lively debate now about whether DC is a “tier-one” city, she said. Whether it is or not, it’s on the rise, she notes.
“Government is increasingly a player in all these spaces,” she said. Part of K Street’s value proposition is helping small companies and startups gain a foothold in regulated industries where a giant may dominate the space and regulators’ attention. National security, finance and public affairs are three industries where a presence in DC or a connection to the city is a huge advantage.
Increased Role of Government An Opportunity For Some
Paige Soya, managing partner of K Street Capital
A recent fintech pitch event packed a room in the International Square with informed-sounding investors listening to pitches about companies including Wellthi, founded by Fonta Gilliam. The company embeds content and social connectivity inside existing banks’ apps and advertises partnerships with Zendesk, Sutton Bank and Visa on its web site.
Selena Strandburg, founder of The Know, an enterprise software company that supplies the public affairs teams at big companies understand how to respond to global news events, came to Washington, D.C. in 2019 to work on a company that worked on civic involvement. It led to The Know, which she founded in 2022. It’s raised more than $1 million and has a team of four.
Anecdotal evidence suggests that women are playing more of a role in Washington, D.C. than in other tech hubs, perhaps part of the she-economy that Mimi Montgomery of Axios wrote about last spring. Overall, the world of venture-backed tech companies remains shockingly dominated by men, with less than 3% of venture capital going to companies founded by women. (That number hasn’t budged in decades, and is about the same in the United States and Europe.). Women entrepreneurs and venture capitalists still face deep-seated cultural biases that have proven difficult to dislodge. If you needed more evidence of this, consider that women entrepreneurs who raise money from women venture capitalists have a harder time getting following rounds. As other industries are, venture capital is increasingly dominated by large firms that set the rules of the road: most of those are in turn dominated by a culture that heavily favors male leadership styles.
But The Statistics Don’t Tell The Whole Story
Though the statistics reflect the largest deals, which almost always involve male-founded companies, I see women in technology moving forward, mostly ignoring the obstacles and creating their own successes and definitions of success. For instance, women entrepreneurs are more likely to get funding if they say they are operating social enterprises – Wellthi identifies itself as one. Strandburg said she was motivated to become an entrepreneur after she noticed how much easier it was to make an impact in the world through companies.
And women continue to invest in other women.
At K Street Capital, about 25% of the investors are women, Soya said. About 35-40% of the companies it invests in across the company are women-led. “For some reason, DC has a more egalitarian culture,” Soya said.
Strandburg echoed that assessment, and said in her industry – public affairs and communications – she has found it to be an advantage to be a woman. “I have deep empathy for executives who make very challenging decisions impact thousands of employees’ lives,” she said. “Starting with empathy helps me solve the problems that literally keep customers up at night.”
Though, there are still parts of the DC tech scene that are almost entirely male-dominated, including national security. Mollie Breen, founder of Perygee, The company supplies no-code tools that help companies automate processes, including in the IT and security fields. Breen, a mathematician who worked at the NSA, said she is rarely the only woman in the room when founders or others from her industry. “But there are usually only a couple of us,” she said.
This post was originally published on here
