Keith Rabois, CEO of Khosla Ventures, was having dinner with a “very successful CEO” in October 2018 when the CEO asked him a question: How many people does it take to create a whole new Silicon Valley? 10,000? 100,000?
Rabois didn’t know it, but he decided to accept the challenge and set out to try to make Miami the next Valley.
And even though other major investors like Andreessen Horowitz decided to abandon the company and close its Miami office just two years after opening it, Rabois said he remains optimistic about the South Florida city.
At the Primary Venture Partners summit in New York on Thursday, Rabois said that 11% of all seed investments in the United States come from Miami, representing “basically a jump from zero,” and he hopes to increase that number to 20%.
Although according to PitchBook data, seed investments in Miami startups so far this year accounted for just 2.6% of total seed investment in the U.S. In 2023, they accounted for 3.5%.
“And the stats to look at if you’re concerned about the future of technology are the fraction of early-stage investments, where are they coming from?” Rabois said, adding that later-stage investments reveal less about the future of technology.
Rabois also said Khosla Ventures was preparing to invest in its fifth company in Miami that will “reinvent education,” but did not provide details.
In April, Khosla and Founders Fund, where Rabois worked from 2019 until January, led the $150 million investment in expense management startup Ramp. Rabois said Ramp, which is based in New York, has an office in Miami, adding to the city’s appeal.
Rabois said he is often active on X/Twitter promoting Miami as a great place for founders because he believes it takes work to build a new tech hub. He added that he wanted founders and investors to know there are opportunities in vibrant cities where one doesn’t wake up every day in fear of being “mugged and abused,” clearly making a jab at the homeless and opioid epidemic in San Francisco.
While Rabois still believes in Miami’s future as a tech hub, he hasn’t completely abandoned San Francisco and reportedly spends about a quarter of his time at home there.
Aside from that, Rabois said he would support Daniel Lurie for mayor of San Francisco, who has a strong stance on addressing the opioid crisis.
“To build a tech ecosystem, you need angel investors, founders, Series A investors, and a whole host of different skills within a company: engineers, designers, business people, salespeople. It’s really hard to get an ecosystem up and running,” he said. “So, canvassing is important.”
Update: This article has been updated to provide more context on the percentage of total U.S. seed investments in Miami startups. This article was originally published on September 12, 2024 at 12:37 pm PT.
