Recent years have seen an explosion of venture capitalists and private equity firms descending on the tropical paradise of South Florida. Fueled by lower taxes, better weather, less Covid-era restrictions and a seemingly ‘arms-wide-open’ culture and creative economy, Miami has now become the epicenter for startup culture. But Jeff Ransdell figured that out in 2017 when he started “Fuel Venture Capital.”
Everyone’s moving to Miami now. But it’s 2022. What was the investing and startup scene like in 2017?
To be transparent, in 2017, as far as I know, it was really Fuel Venture Capital and Rokk3r Labs, which is a group of very smart technologists and consultants who help builders to vet ideas, build business plans, go to market plans, and build tech stacks to back these ventures. The team at Rokk3r was the pioneer of the tech ecosystem between Miami and LATAM. Fuel Venture Capital worked very closely with the team in the early days and had our offices across the hallway from the Rokk3r teams. My team and I are finance people who have been responsible for other people’s money since 1994. It was essential for us to build wisdom from ideas to creation to exit, then apply finance and analytical skills on top to deliver a reasonable investment opportunity to our Limited Partners.
How/Why did you choose Miami as home base?
From 2001 to 2016, I was one of six executives who ran the Merril Lynch Global Wealth Management Business. My P&L responsibilities were the state of Georgia, the state of Alabama, the state of Florida, the Caribbean, and all of Latin America, so I had my divisional headquarters in Miami. I commuted from Miami to NY every other week, if not weekly, during that time frame. So I came to Miami as a career and personal growth opportunity. Having LATAM as a responsibility was frankly one of the best things that ever happened to me.
I have met the most amazing people who have taught me different cultures, languages, and friendships, which have become family in many ways. Miami is unlike any other city in America. My native language, English, is not the go-to language on any given day, going up and down elevators, restaurants, or at the gym, meetings, etc. I like to say people love Miami or hate Miami for the exact same reasons and that all boils down to your acceptance that no one cares where you came from, no one cares what color your skin is, no one cares what sexual preference you may have. Accents are normal and create wonderful ways to learn new things from amazing people who sport those accents. Miami is the greatest city in the world, in my humble opinion, and I have been around the world a few times. I will never leave.
What’s the founder culture like in Miami – who’s here now vs. then?
Back in 2017, the founder scene in Miami was like seeing a rare species of animal. It was just a rare sighting. Today the founder scene is amazing and aligns well with what makes Miami unique. These founders are from all over the world, and they are doing some really amazing things. You were crazy if you tried to have a startup in 2017, raise capital, and hire 50 people. Maybe if you were opening up a nightclub.
What percentage of investors in your firm are Florida based?
This is one of the things we as a community really need to work on. If you think about what made Silicon Valley so special was the community which rallied around the founders, they invested in their companies directly if they knew what they were doing and had the time and energy to manage the process themselves, or they found professional fund managers to diversify and lower risks associated with investing of any kind. The point is that the community was also providing fuel to its founders, which is why Silicon Valley is the mother of the creative economy and will never lose that position. Here in Miami/Florida, we are not there yet. At Fuel Venture Capital, we have deployed $400MM over the past five years, $100MM of that into South Florida founders, all with about 10 investors from Miami/Florida. I hope this changes, and I want to be a part of that change because I know how important it is. We just launched our fourth fund, and I hope we can attract more investors into this asset class and help them be a part of fueling the future innovation of our planet. Without investors to support, there is no innovation, and our future does not look so inspiring.
What’s a company you have invested in that chose Miami as home base but could have chosen anywhere?
Betr is a wonderful example of a company that could have launched anywhere but chose Miami. Betr, in my opinion, and many others, will be the biggest sports betting app and sports media company on the face of the planet in the next 24 months. Its founder, Joey Levy, is a rock star who has already successfully built a business-to-business sports betting company called Simplebet. Joey grew up in Miami but, like most creatives, left for more fertile creative soil to build his first company. After seeing Miami’s explosion of tech-focused creatives migrate to the 305 during COVID, Joey decided to team up with his co-founder Jake Paul, and I am incredibly proud of them. The team they are building are all from incumbent sports betting and media companies who are all moving to the 305 to live, develop and thrive. Our VR company Aexlabs’ from founder and Miami native, Jonathon Ovadia, is growing quickly, and of course, everyone here knows Taxfyle. They were one of the originals down here. It’s honestly a fertile ground for founders and startups. We have over a dozen in South Florida alone.
Do you think all of the buzz about Miami will continue? And all of the people that moved here will stay?
I believe we have created a solid foundation, but as I said above, we must get the community behind the tech train to keep it moving down the tracks. Without fuel (capital), founders will have no choice but to go elsewhere for the fuel they need. I also see cities like Austin, Texas, and NY governments recruiting creators to their cities because they understand how important it is for their communities, from job creation to energy to innovation for future survival. I would like to see our government leaders align and spend time with firms like ours to create packages to attract founders and keep them here. We invest globally. One of our core skills is late-stage strategies moving companies into the public markets or bringing companies located offshore onshore. Miami is the obvious first choice because we are here. Still, lately, we have lost a few global tech companies in our portfolio to other cities, which has made it too hard to ignore. These city leaders treated founders like they were recruited onto the city’s NBA teams. They gave them tax breaks and lease supplements for the next three years, and Miami wasn’t competing. We have something extraordinary here in Miami, but we need to feed it and spend time, energy, mental capacity, and capital to keep it and grow it.
You’ve been quoted as saying one doesn’t need to go to Sand Hill Road to raise money or to create a startup in Silicon Valley. What does Miami offer as an alternative?
We believe information has been democratized due to technology. We already have proof sourced; you do not have to be in Silicon Valley to access talent. We have an investor in LATAM who owns a tech dev shop, and 80% of his business comes from Silicon Valley. Smart LATAM young people get educated in the US, want to return to their home country, and build cost-effective tech dev shops. You have VC Firms like ours who get very involved and try to create a lot of value. I believe at a larger scale than our peers out on the West Coast. I believe we tend to be more founder-focused, and we are for sure more investor driven. Of course, the West coast has all this, but it is just different here in Miami, and if that is confusing for you, then my advice is to come to the 305 and spend some time. It will not take long to feel and see what the alternatives are.
Fuel VC has multiple funds with over $400 AUM – what has it been like raising that capital?
Capital raising is the lifeblood of the creative economy. It doesn’t matter if you are a founder of a company or the founder of a VC firm; you are constantly raising capital. You can have the smartest people on your team. You can have the greatest technology and office space, but you will not go anywhere if you do not have FUEL. Investors need to understand the “WHY” becoming a partner in this asset class is about giving back and assuring the future is better than the present.
I like to say it is the rejection Olympics, but we show up every day and play the game at the highest levels, and we never ever kneel.
Miami is a melting pot of cultures. What is the makeup of your team? Investors?
The makeup of our team looks like the city where we work, which I believe is important. We speak six different languages and come from eight different countries. Something I am personally very proud of is that more women than men occupy our senior executive positions.
Half of our limited partners are from the United States, 40% from LATAM, and 20% from the EAU, Europe, and the UK.
What is next for Fuel Venture Capital?
We are super excited; we just launched our fourth fund, which will be a global $300MM fund. We take into this new fund a lot of learning, and we are all very excited. We believe, at our core, this is the single greatest time to be investing in the creative economy. What is in front of us over the next five, ten, fifteen years will be mind-blowing, and we will be at the center of it all. Www.FuelVentureCapital.com