Red 6 is a cutting-edge tech company that uses artificial intelligence and augmented reality to train U.S. military fighter pilots. KindDesigns uses 3D printers to build and repair “living seawalls” with environmentally friendly materials that can reduce storm surge and create a marine habitat.
Both bring dramatic change — what the cool kids these days call disruption — to their marketplaces. And you, Florida Trend reader, own a teeny piece of each company.
They’re among 54 businesses in the Florida Opportunity Fund’s portfolio. Florida lawmakers created the fund in 2007, expanding its mission over time to help startups in life sciences, space technology, manufacturing and clean energy with early-stage venture capital.
Quietly, it has become an important cog in the state’s venture capital arena, helping to fill out funding rounds and bring in other investors.
“Most people are not aware that Florida has a state-created venture capital fund,” says Opportunity Fund CEO Robert Harvey. “It’s not common.”
The Opportunity Fund is “a version of a sovereign wealth fund,” says John “Jay” Rogers, founder of 3D furniture printing manufacturer Haddy, which joined the Opportunity Fund portfolio with $987,000 invested in 2023.
A MURKY, BUT GROWING MARKET
There are no reporting requirements on venture capital, so getting precise data on overall investment activity in Florida can be tricky. Miami-based eMerge Americas, a tech facilitator that has an accelerator program and pitch competitions and hosts an annual summit that draws thousands of people, estimated $4.13 billion in overall state venture capital deals in its 2024 Insights report. That figure is based on Pitchbook data, the “gold standard” for gathering information in “a very dark market,” says University of Tampa finance professor Speros Margetis.
Widening the fields a bit but also using Pitchbook, Margetis, who has studied venture capital for more than 20 years, pegged Florida’s 2024 total at $4.89 billion. The eMerge report placed Florida sixth nationally, behind California, New York, Massachusetts, Texas and Colorado. The state would need to quadruple investment capital to reach the Florida Chamber of Commerce’s 2030 Blueprint goal of surpassing New York for third place.
While venture capital may not be growing as fast as people might want, it is growing, fueled by a significant influx of money and the people who control it in the wake of the COVID-19 pandemic along with maturing support networks in markets from Northwest to South Florida. It spiked dramatically during the pandemic, reaching about $10 billion in 2021 and 2022, according to Margetis’ parameters.
New people bring new thinking, he says. “In California, the attitude is they don’t want to miss the next deal, so they throw money at everything. In Florida, the attitude is ‘I’m waiting for the next deal,’ so they’re still a little apprehensive. Now, Miami’s already turned the corner. They’ve already got a new appetite for risk and just a lot more activity. Tampa is finally there. People are understanding venture capital. There’s more money flowing into it. There’s been more growth and activity in the past five years than there was in the previous 15.”
South Florida, home to about two-thirds of the state’s venture capital activity, saw $900 million in deals during the first quarter. “These are numbers that we would dream of doing 10 years ago,” says eMerge Americas President of Business Development T.J. Villamil. “So we’re like a top five, top six venture/risk capital ecosystem which is really healthy for being the newer kid on the block.”
Florida’s population growth has helped fuel an entrepreneurial spirit, says Florida Venture Forum CEO Kevin Burgoyne. “We’ve always been obviously a low-tax, relatively low-regulation state, and it’s a great place to live. We’ve always been a place where people can come and start a new life. It’s been the story of Florida in many ways.”
The forum has about 500 members who provide startups with everything from early seed money to later stage private equity. It also hosts annual conferences where founders can meet with and pitch investors. It used to draw about 400 people each year but turnout has more than doubled since COVID, Burgoyne says. The 2026 conference may cap attendance at 1,000 people due to space.
Communities throughout the state also have fueled venture capital growth by creating their own infrastructure of incubators, accelerators and entrepreneurial centers. Florida’s colleges and universities are producing the talent startups need.
PERCEPTIONS AND PRIORITIES
The Florida Opportunity Fund works with those networks and attends conferences like eMerge Americas and the Florida Venture Forum to let founders know about the opportunity it offers.
The fund “changes the perception of the state in terms of what type of business is getting done here,” Harvey says. “It’s no longer just agriculture and tourism, for example. Also, the state looks like a leader in innovation. We’re not going to be Silicon Valley — they’ve been doing this for 50 years. But with all the movement, certainly post-COVID, of money coming into Florida, we’re now much more looked at as a place to come and do a technology-based startup than we ever would have (been). That’s important.”
The fund is managed by Orlando’s DeepWork Capital, which conducts due diligence on applicants and makes recommendations on whether to invest to the fund’s five-member board.
DeepWork sees as many as 3,000 prospective deals each year, says partner Ken Hall. Most simply aren’t viable, while some get discarded if the company isn’t Florida-based. It also can’t get into “vice tech” — things like alcohol, tobacco or marijuana-related industries.
Successful pitches demonstrate “the ability to generate returns that can have the program sustain itself over time and ideally mimic venture capital returns,” he says. The fund is never the lead investor and won’t get involved in projects unless it is confident that the lead investor can provide governance and add value. “If it’s (a major name) the state would follow them, and it effectively becomes a way to replicate institutional venture capital exposure.”
By law, the fund prioritizes life sciences, advanced manufacturing, aerospace and defense and clean energy.
“The normal person does not know this kind of cool stuff is happening” in the state, says Susan Amat, one of five Opportunity Fund board members and director of Entrepreneurial Initiatives at the University of Miami’s Herbert Business School. She also founded The Launch Pad entrepreneurship education program at UM. “When I get the packets and I’ll sometimes be reading through them, I’ll be like ‘How is this in Florida and no one knew?’”
But that reputational lag also creates missed opportunities, Villamil says — and deals that might come to Florida don’t.
“We have not made it yet,” he says. Florida is not on the radar for many Asian investors who look only to California and New York. “So we really need to be aggressive in how we’re marketing and branding Florida as no longer just beaches and tourism. We are a big, dynamic, growing economy of the world of the present and the future with talent and infrastructure and innovation. They still don’t know that.”
The state still misses out on potential game-changing investments due to a reluctance to go big on incentives. Villamil points to January’s decision by the defense contractor Anduril to build a $1-billion advanced manufacturing facility in Ohio, lured by a 30-year job creation tax credit worth $452 million. Anduril promises 4,000 production and service jobs.
“That should be built here,” Villamil says.
CHALLENGES AND OPPORTUNITIES
The Florida Opportunity Fund simply doesn’t have the money to attract such mammoth projects. Its role is to identify and invest in ventures that can grow the state’s economy and add good-paying jobs. A recent presentation projected at least 2,500 new jobs from companies in the fund’s portfolio in the next two years.
ONE CHALLENGE FLORIDA STILL FACES: finding enough mid- to high-level executives who want to put in the brutal hours that startup life demands.
The fund received $30 million from the state in 2010 and has seen a handful of additional adds funneled through the state from the U.S. Treasury Department’s State Small Business Credit Initiative. But the tax-exempt evergreen fund’s operations — including paying for lawyers, accountants and advisors — are self-sustaining.
Florida is still having some challenges, Amat says. “The talent has improved a great deal, so you can find strong employees when you get that funding. You can hire well. I think we’re still missing a lot of the mid- and higher-level executives who have come here and don’t want to do 60-to-80-hour weeks anymore. So those people are now advisers to companies or … board members.”
Another difficulty: Florida’s salaries still lag behind what tech workers can make in states like California and New York. “The cost of living is a huge problem,” Amat says. The answer could come in equity shares to prevent younger talent from seeking higher-paying, safer jobs in consulting or finance.
“If it’s not part of who you are already, it’s a little bit harder to say, ‘I’m going to give up my 20s to be in a startup and be paid less than I would and have less time to myself.’ You know what I mean? It’s a pretty obvious choice for most people unless you have the bug.”
The state should factor equity given to startup employees into Florida Opportunity Fund evaluations, Rogers says, because it builds more wealth. If Haddy succeeds as he hopes, his dozen employees could become millionaires. “They’re going to invest in Florida.”
It is known as “the Dell Effect” based on the way Dell computer founders used their newfound wealth to help transform Austin into a tech hub. Florida has its own examples: Connectwise’s 2019 sale to private equity giant Thoma Bravo offers a striking example, Margetis says. Arnie Bellini’s IT software solutions and cybersecurity business was Tampa Bay’s first unicorn — a $1-billion valued company — and its sale to Thoma Bravo created an estimated 70 millionaires.
High-paying exits like that have ripple effects that can reach countless businesses. “You create all these people that are too rich to work for someone else but too young to retire,” Margetis says. “So what do they do? They go start companies. They’ve got a proven track record of taking a Connectwise to what they’ve achieved. So they raise money, they grow companies, they hit liquidity events. They create another group of people that are too rich to work for someone else but too young to retire. And then they spin the next bunch.”
Their experience and guidance can be worth more than the cash they bring to the table. “You need smart money,” he says. “You need people that have got industry expertise, contacts, the ability to fill holes in the management team, the ability to sit on the board and provide strategic choices.”
The state should continue its trajectory of attracting more venture capital, which helps build more innovative startups. Florida offers “a very healthy breadth of innovation,” Deep-Work’s Hall says. Where Boston’s biotech industry is deeply rooted, Florida has developed “very, very successful companies in cyber, in energy, in advanced manufacturing, in enterprise software, in robotics, life sciences, space tech. And there’s pretty amazing stuff being built in our back yard.”
“There is still a shortage of capital when you compare it to these other markets,” he says. “There’s no shortage of qualified opportunities. So now it’s just about starting to mobilize capital towards them.”