Miami virtual gaming developer stopped hiding his hometown, learned to love #Miamitech
Miami tech had a stellar year in 2021. It wasn’t always like this.
For the co-founders of Miami-based virtual reality gaming studio AEXLAB, there had been an unofficial rule when meeting with the outside world: Don’t mention their hometown.
CEO Jonathan Ovadia, a Miami Beach Senior High School and University of Miami graduate, said the decision to do so had nothing to do with what outsiders really thought about his roots, or the virtual reality company they started in 2017.
Instead, it was based on experience: There was just no respect for the city as a desirable place to nurture a startup technology company.
“It was nonstop getting insulted, that we were crazy to be in Miami,” Ovadia said. “As first-time founders, investors would immediately ‘X’ us out based solely on where we were from, despite any experience or track record. It was just a red flag ... so we kind of hid it.”
This year, of course, the narrative flipped. Miami has experienced unprecedented interest in, and investment from the tech community. More high-end entrepreneurs like AEXLAB are making money, and in doing so raising the city’s national profile — though challenges like diversity and inclusion remain.
However, heading into 2022 the Miami stain has been mostly lifted.
“Now it’s the biggest blessing in the world,” Ovadia said. “Everything changed with COVID and Mayor Suarez — more people want to work with us, and there’s more capital coming in.”
The company was born out of a music label Ovadia, his brother Albert and Elizabeth Ann Clark, Albert’s partner, were running around 2014. Elizabeth decided to create a virtual reality music program, an experience that led to jumping on a gaming trend that began surging in 2017. Until recently, the group was still working day jobs.
This year AEXLAB raised at least $5 million. Its workforce now totals 16, and the company’s client Rolodex includes Red Bull, the American Institute of Architects and Epic Games.
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AEXLAB, and Miami tech more broadly, are likely to see continued growth in 2022. Real estate experts say out-of-state interest from significant tech players remains strong.
“We are seeing continuous demand from companies from out-of-market, especially California and New York,” said Tere Blanca, founder, chairman and CEO of Blanca Commercial Real Estate, Inc.
“Not only are they moving executives, but they’re also hiring and recruiting talent here. When you speak to staffers or recruiting companies, every one of these companies is looking to take significant footprints. There’s a tremendous amount of demand for spaces.”
Ovadia realizes the tech influx has not come free. As a native, he has noticed its flipside: Miami’s cost of living has, he says, “gotten out of control.”
“I understand why, we’re now the most desirable place in the whole world,” he said.
It’s made competing for top talent all the more difficult. While some large tech companies can afford to pay six-figure salaries, as an early stage company, Ovadia’s firm can’t.
“So now that puts us in a unique position,” he said. “Before, the understanding was, you would make much less but live a much better life. Now, I need to pay you more to live the same life.”
But even here, he is sanguine: He says he knows real estate developers are aware that the high housing prices are not sustainable, and that in three to six years more commercial buildings and homes will be built.
What about in the interim? To save money, he said, his Miami friends have “downgraded” to living with more people — friends or relatives, or finding smaller homes.
Meanwhile, much of Miami’s workforce — namely, its service industry — is likely benefiting from the deluge of tech and wealth coming to Miami.
“If you’re selling Jet Ski rentals or working in cellphone and smoke shop stores,” you’re probably also doing well, Ovadia said. That jibes with what a caterer and a DJ recently told me: That there are more events than ever, with more demand for work and services from wealthy clients.
Ironically, Ovadia said, it is Miami’s existing white-collar workforce that may be suffering from the tech influx, since they may not be capturing new business and therefore are seeing their salaries stagnating as costs rise.
“Some people are definitely getting hurt, just like in life some do well and some don’t,” he said.
The best thing as a city, he said, is to invest in the education.
“If people learn software skills, they will get compensated accordingly,” Ovadia said, “but in Miami, no one ever really said ‘learn tech’ until recently. So there is going to be a lag.”
This story was originally published December 26, 2021 at 6:00 AM.
