Startup Guide: Huntsville

If you’re looking for a city with a rocket-like trajectory, look no further than Rocket City itself. Huntsville, Alabama was recently named one of the top 10 best-performing cities in the U.S., is a key national technology hub, and is growing by the day. If you want to learn more about the startups and community driving that growth, this guide is for you.

I’ve developed this guide to Huntsville in conjunction with the Build In SE team, to help equip startup founders and operators with the resources they need to build their companies. Build In SE is dedicated to increasing the number of startup success stories in the Southeast by leveraging a cross-regional, collaborative network. If you’re interested in learning more about the region or what we’re doing, or would just like to connect, please reach out to me at ryan@buildinse.com.

View of the U.S. Space & Rocket Center located in Huntsville

Overview

Huntsville earned the moniker “Rocket City” for its role in the 20th century Space Race, and its continued leadership in space technology. Huntsville was home to the rockets that put the first U.S. satellites and the Saturn program into space, and that powered the Space Shuttle and the International Space Station. Beginning in 2023, Huntsville’s airport will be the first and only commercial airport licensed by the FAA for a space plane landing, as the Sierra Nevada Corporation will lands its NASA-cargo-carrying Dream Chaser space plane at Huntsville International Airport (HSV). And Huntsville was recently named the new home for the United States Space Force, continuing their (inter)stellar legacy. Past and present, Rocket City is one of the most impactful cities in the country for technology.

Huntsville has the talent to back up a name like Rocket City; it’s home to over 20,000 engineers, boasts one of the highest engineers-per-capita rates in the country, and is one of the top 25 most educated cities in the U.S. Both employment growth and wage growth were double that of the U.S. averages between 2000 and 2017, according to the Huntsville/Madison County Chamber, and the city has dramatically outpaced the broader U.S. on economic growth.

Huntsville is also well-connected to other metro areas throughout the Southeast. It’s about an hour and a half drive from Chattanooga and Birmingham, less than 2 hours from Nashville, and about 3 hours from Atlanta, Knoxville, and Memphis. Huntsville International Airport (HSV) offers direct flights to Atlanta, Charlotte, Chicago, Dallas, Denver, Detroit, Houston, Orlando, and Washington D.C, and is easy to get to from anywhere in the city. The interconnected nature of the Southeast ecosystem is a key value-add for Huntsville.

Huntsville is in the midst of a renaissance now. It’s the second-largest city in the state, and the fastest-growing. People are moving from across the country to explore Huntsville and take advantage of the low cost of living, warm climate, classic Southern hospitality, and boundless outdoor space and activities that North Alabama has to offer. Arts centers and breweries have sprung up around town, complementing the top-notch Southern food. Both the downtown area and surrounding suburbs are seeing rapid development of new housing, entertainment options, and more. And to top it off, U.S. News & World Report ranked Huntsville the number 1 Best Affordable Place to Live for 2020–2021, above other rising tech hubs like Pittsburgh, Indianapolis, and Cincinnati.

Rocket City isn’t just poised for takeoff — it’s already in-flight.

View of downtown Huntsville

Huntsville Tech Backdrop

Huntsville’s startup and tech scene is largely fueled by its outsized engineer population. Of its top 30 employers, 17 are science/tech-focused businesses. Huntsville has been ranked the number 1 city for engineers by both Forbes and NerdWallet, was ranked among the top 3 cities for most high-tech jobs, and continues to attract high-level tech talent. And Huntsville recently became home to the nation’s first high school focused on the integration of cybertechnology and engineering.

With its history as an aerospace and defense hotbed, Huntsville has been called home by many hard tech-focused businesses. Contractors like Northrop Grumman, Boeing, Raytheon, and General Dynamics all have a major presence in town. Aeroject Rocketdyne houses its defense headquarters in Huntsville, and they were recently acquired by Lockheed Martin, who is making North Alabama its flagship location for hypersonic technology work. Booz Allen Hamilton is building a state-of-the-art Innovation Center in West Huntsville, and earlier this year, Jeff Bezos’ Blue Origin opened its Huntsville site for BE-4 rocket engine production. And of course, two of the city’s top employers are the U.S. Army (at the Redstone Arsenal), and NASA (including the Marshall Space Flight Center).

Aerospace and defense businesses aren’t the only engineer-heavy companies in Huntsville, though. Polaris, Toyota, and Mazda all have large manufacturing facilities in the area. Facebook and Google are both building data centers in town, and LG recently opened a solar panel facility. Biotech incubator HudsonAlpha is home to over 40 businesses working on human health research, gene sequencing, genetic disease research, and more.

Huntsville has served as the starting point for many homegrown success stories. ADTRAN is one of the largest telecom equipment providers in the country and went public in 2010; Dynetics is a highly successful applied science and IT contractor, and was acquired in 2020 by Leidos for $1.65B; and Intergraph, a leading provider of enterprise engineering and geospatially powered software, was acquired by Hexagon AB for $2.13B in 2010.

Many of these major companies are housed in the bustling Cummings Research Park, the second-largest research park in the country. Cummings brings together some of the top minds in technology for innovative thinking, while also offering a plethora of nearby dining, shopping, entertainment, and housing options.

Rocket City is continuing to cement its reputation as the country’s hub for space-tech, but it’s also branching out beyond its traditional strengths. Rick Ambrose, an EVP at Lockheed Martin, has said that Huntsville is seeking “to become the innovation hub of the South with [artificial intelligence] and other technologies, like quantum computing”. The city’s startups are showing that, where talent gathers, good things are sure to follow.

Huntsville Startups to Watch

Many of Huntsville’s startups exist in the aerospace and defense space, serving the vast customer population in Rocket City that requires advanced manufacturing capabilities, analytical services, and other engineering-centric offerings. However, that hasn’t stopped a diverse set of small businesses from flourishing in town.

• Spur is a human capital management platform for businesses with hourly workers, aiding companies with payroll, benefits, health insurance, timesheets and shift management, and more. Spur was founded in 2017, and turned heads in 2019 with its $8M Series A round, which included Mark Bezos (brother of Amazon CEO Jeff Bezos) of Third Prime Capital and John Griffin of Blue Ridge Capital.
• Aevum recently unveiled its primary offering, the Ravn X, a reusable, turbojet-powered drone that will fly an expendable two-stage rocket into the atmosphere. This autonomous launch vehicle-designing startup gained significant momentum through multiple Air Force contracts in 2019, and is poised for future success. Aevum’s goal is to “democratize access to space” by lowering the costs of cargo via rocket — reducing the average $60 million of each SpaceX flight to mere thousands for a Ravn flight.
• Acclinate Genetics is a minority-owned biotech startup that is working to increase diversity in genomic research and clinical trials, to help ensure treatments don’t have unpredictable side effects or negative impacts on underrepresented groups. According to the Acclinate team, their platform leverages “machine learning and predictive analytics to automate the identification, education, engagement, and retention of willing & diverse genomic research and clinical trial participants.”
• KODA Technologies, founded in 2017, provides engineering and analytical services around flight test planning and execution, missile and radar engineering, and systems engineering. KODA was named one of the Best Places to Work in Huntsville in 2020 in the small business category.
• Seamly2D is a free, open-sourced, pattern-making app-based solution for customizing clothing patterns at scale for the custom tailoring industry. Seamly was the Industrial/Manufacturing sector winner of Launchpad Alabama’s 2020 startup competition.
• AME, founded in 2018, provides additive manufacturing services to public- and private-sector clients throughout the Southeast. Their capabilities include 3-D metal printing, metallurgical analysis, selective laser melting, and more.
• Paratus Universe might be the most “Rocket City” startup in town, creating detailed, immersive space simulations for a variety of audiences. According to founder and CEO Dr. Rob Adams, “Players use controls designed by engineers in the space industry, and they view stars and planets using actual footage from prior missions.”

Huntsville Startup Funders

Huntsville itself has a limited venture capital scene:

• Eastside Partners is the only early-stage VC firm in town. Eastside targets SaaS, healthcare, and tech-enabled businesses, and primarily those located in the Southeast.

Other funds operating in the state of Alabama include:

(Firm: Industry | Stage)

• Alabama Futures Fund: Agnostic | Seed
• Alabama Launchpad: Agnostic | Pre-Seed, Seed
• Bonaventure Capital: Construction, impact, financial services, other | Growth
• Bronze Valley: Agnostic | Seed
• Collective Capital Ventures: Technology and tech-enabled businesses | Seed through Growth
• Fidelis Capital: Agnostic | Series
• Harbert Growth Partners: Information technology businesses (cybersecurity, enterprise software, fintech, healthtech, real estate tech) | Series A, Series B
• Jemison Investment Company: Agnostic | Seed, Series A
• New Capital Partners: Financial services, healthcare, enterprise | Growth
• Redhawk VC: Agnostic | Seed
• TechStars Alabama EnergyTech: Energy | Accelerator
• Timberline Management Company: Financial services, healthcare, real estate | Growth
• Velocity Accelerator: Agnostic | Accelerator

This list focuses on venture capital firms with headquarters or a major presence in Alabama. To check out more venture capital firms based throughout the Southeast, check out the 2020 Southeast Capital Landscape built by Embarc Collective and Build in SE.

Huntsville Incubators and Accelerators

• Urban Engine is a nonprofit focused on propelling the growth of North Alabama’s economy. The organization offers four distinct (and free) programs to help entrepreneurs succeed: 4HTP guides participants through the process of developing an idea into a minimum viable product; OpenHSV is an open sourced community platform built by creative engineers to help professionals get connected with their hyper-local network; the 32/10 Speaker Series is a collaborative forum allowing entrepreneurs to share and bond over their successes and failures; and CoWorking Night is a mini workshop series for co-working professional communities to learn, connect and collaborate with their local community and marketplace.
• BizTech is a Huntsville-based incubator that has supported hundreds of companies since its founding. BizTech operates the StartUp2Launch program, which helps founders navigate each stage of the startup-scaling journey, and connects businesses with resources and mentors to provide support every step of the way.
• The Invention to Innovation Center (I2C), hosted by the University of Alabama in Huntsville, is a multifaceted entity focused on facilitating the creation and growth of science, engineering, and tech companies. The I2C offers access to capital and relationships with VCs, community events like hackathons and speaker series, relationships with mentors and advisors, coworking and permanent office space, and more.
• HudsonAlpha is a unique biotech incubator that exists to tie together the forces of discovery, education, medicine, and economic development. The organization is focused on supporting genomic advances, and offers commercialization support, office and lab space, mentorship, and a shared entrepreneurial community.
• The Catalyst offers a broad spectrum of startup support services. Their Women’s Business Center helps women start and grow small businesses in North Alabama through workshops, mentorship, microloans and other financing; their Veteran’s Accelerator helps military veterans build and scale their startups; TechRich focuses on meeting the needs of the defense and space industries by identifying promising technologies and startups and connecting them to the appropriate resources and contacts; and the HUBZone Accelerator works to empower underserved communities by aiding entrepreneurship. The Catalyst offers additional services and programming for all kinds of startups.
• gener8tor is a Madison, Wisconsin-based accelerator that has recently launched two new programs in Huntsville: its classic Accelerator Studio, and gBeta Huntsville. The programs target companies at different stages in their lifecycle. gener8tor will be partnering with RCP Companies’ new MidCity Accelerator Foundation.
• Ad4! Business Acceleration aids startups looking to scale by providing a variety of advisory services, including business process modeling, exploration of operational efficiencies client and market identification, and team member-training, among others.

Huntsville Coworking Spaces

In addition to the I2C, Hudson Alpha, and the Catalyst mentioned above, a variety of other coworking options are available in Huntsville:

• Huntsville West has converted a former school into a collaborative office space and offers a broad spectrum of coworking solutions, including flexible month-to-month memberships and specialty rooms for audio/visual projects.
• Huntsville Hub has served Huntsville businesses for over 25 years, and in addition to coworking space offers private offices, virtual office support, and more.
• Spaces (a Regus subsidiary) operates a new coworking and office space in West Huntsville near the Space & Rocket Center, offering a variety of membership options for startups.

Huntsville Startup Community & Event Organizers

• The Huntsville-Madison County Chamber supports businesses in the city and throughout Madison County with events and communications, public affairs efforts, workforce development and education, the aggregation of key business info, and more.
• Each year, various stakeholders come together and host Innovate Huntsville, a week-long event dedicated to bringing entrepreneurs, and innovators together with local resources to build momentum and opportunity around Huntsville’s vibrant entrepreneurial ecosystem. 2021’s iteration took place from February 22–26, and the virtual format helped connect the entire region.
• RocketHatch is a 501(c)(3) nonprofit organization with the mission to accelerate the startup ecosystem in North Alabama. The organization supports entrepreneurs by surrounding them with the resources they need to be successful.
• Lowe Mill Arts & Entertainment is a converted cotton mill, now operating as the largest privately owned arts facility in the Southeast. The facility houses hundreds of creators and artists, and hosts a number of community events — and is home to Huntsville STEAM Works, an Alabama nonprofit focused on education through Science, Technology, Engineering, Arts, and Mathematics.
• The Huntsville Association of Small Businesses in Advanced Technology (HASBAT) works to increase business opportunities for high technology small businesses in the Huntsville area.

Huntsville Public Initiatives and Resources

• The Huntsville-Madison County Chamber runs ASmartPlace, a one-stop shop for information on Huntsville’s community and economy. The site does a great job of outlining everything the city has to offer, and also includes a jobs board those seeking work in Huntsville.
• University of Alabama Huntsville’s Small Business Development Center & Procurement Technical Assistance Center helps small businesses across North Alabama thrive by providing comprehensive business counseling and training.
• The Huntsville Entrepreneurs & Innovator Network is sponsored by the City of Huntsville, connecting startups and their founders and operators into the broader Huntsville business ecosystem.
• The Economic Development Partnership of Alabama hosts a startups & entrepreneurs page that hosts a variety of resources, such as accelerators, training & tools, and funding organizations.
• The City of Huntsville has compiled a New Business Start Up Guide to help answer quick questions and provide relevant contacts based on the type of business, and an Investment Prospectus to outline key tax info, details about opportunity zones, and more.
• Bio, Cyber, Energy, and GEO are four initiatives launched by Huntsville to promote economic diversification and development in the city, with various goals and associated incentives.

“Welcome to Huntsville” mural, located downtown in Big Spring Park

About your guide

Hi, I’m Ryan, and I appreciate you checking out this guide to the startup scene in Huntsville. If you’re interested in being a part of the ever-growing success story that is entrepreneurship in the Southeast, check out the Build in SE website, or learn more via our publications on Medium.

If you know of any resources that should be added to this guide, or if you simply want to get in touch, please reach out to me at ryan@buildinse.com!

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