The announcement Thursday that AllegisCyber and DataTribe would not only be moving to Port Covington but bringing a $400 million cybersecurity investment fund with them sent a jolt of excitement through Maryland’s startup community.
The move will bring the type of resources, capital and otherwise, that the state’s business leaders have been looking for to take its startup ecosystem to the next level.
“It helps fuel the entire engine,” said Thomas Sadowski, the University System of Maryland’s vice chancellor for economic development. “We need more capital and we need the kind of mentorship and business acumen that Allegis would bring in.”
Port Covington’s developers announced cybersecurity venture capital firm AllegisCyber, cybersecurity startup studio DataTribe and investment bank Evergreen Advisors as the first tenants of what they dubbed “Cyber Town USA.” In addition to the investment fund, they envision 25-30 firms moving into the development on its first day, late 2020 or early 2021.
TEDCO CEO George Davis called the commitment, “what we’ve been looking for around here for a long time.”
The first thing the move brings to the area is capital, the kind of capital that raises eyebrows and makes people take a second look at the region. It coincides with other money-related news in the region lately, including cybersecurity firm Tenable’s $288 million initial public offering from the summer.
But Davis and Sadowski are excited not just for the cybersecurity startups but for Maryland’s other industries, like biotech and life sciences and other computer-related fields, like data management and machine learning. They think bringing in capital in one area can entice capital in other industries as well.
“I expect that it will start to lead to other venture capital firms wanting to start to establish their presence here,” Davis said. “To now see that one tier, trust me the second one will follow and the third one will follow.”
That could mean more firms stay in Maryland as well. Leaders have expressed their frustration that after they get companies to grow at places like Johns Hopkins University, the University System of Maryland and the National Security Agency, venture capital firms fund them and bring them closer to where they are in Boston or Silicon Valley.
The hope is that maybe now Maryland cannot only retain some of those companies but bring startups from other states to Maryland.
The commitment to Port Covington could also bring leadership capital to an area starving for it. Outside of some high-profile successes, Maryland does not have many business leaders who can say they have been through the full startup life cycle, from seed funding to an acquisition or an IPO. Bringing in more of that C-suite talent could help a lot of the state’s companies grow and make them more attractive to investors.
With multiple industry hubs across the state, from the biotech corridor off Interstate 270 in Montgomery County to the cybersecurity center of Fort Meade and Columbia to the eds and meds in Baltimore, the addition of a cybersecurity hub in Baltimore should buttress Maryland’s community rather than spread resources thin, Sadowski said.
“This is all complementary,” he said. “It’s all a rising tide. We definitely have the capacity and the ability to support this kind of growth, this kind of presence. It’s going to knit together an ecosystem that will become stronger the more it’s knitted.”
While the first tenants are still at least two years away from moving into their new homes in Port Covington, the move will add some immediate jolts to what Sadowski can do in his role encouraging students and faculty to turn their academic innovations into businesses.
“It tells me I can go back out to all these faculty-based startups, all these student-based startups … to say we are adding more dry powder to the marketplace,” he said. “Let’s get started. What was that idea you had? Let’s get a meeting together.”