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Why Alabama is Being Called “Southern Silicon Valley”

Startups in Alabama have grown quickly in recent years, earning tech hotspots like Birmingham and Huntsville the nickname “Southern Silicon Valley.” The Wall Street Journal also described the latter as one of the three cities in the U.S. that represents the future of the tech industry. But the state of Alabama is not a newbie in the tech world. It has come to be known for its engineering prowess and for its feats in the space and automobile industries. 

The reason for this is not far-fetched. Besides factors such as the relatively affordable cost of living and concentration of tech activity, which makes the state attractive to startups, Alabama has employed a systematic approach toward making itself attractive to investors and founders. In addition to having business-friendly policies, the state has been intentional about making its environment both compelling and conducive for startups and businesses.

Leisure and Recreation

There are many fun, relaxing and educational spots to visit in Alabama. The state is also a center of history, with museums and sites that will compel visitors to reflect and learn, including the Civil Rights Institute, Sixteenth Street Baptist Church, Montgomery’s Civil Rights Monument and National Memorial for Peace and Justice, Frank Lloyd Wright Rosenbaum House Museum and Selma’s Voting Rights Museum. There are also scenic areas for people to relax, like Gulf State Park, Dauphin Island, Weeks Bay National Estuarine Research Reserve and Cheaha State Park. Alabama has expressed its intention to leverage its rich outdoor recreation assets as a tool to attract and retain workforce talent.

One of such steps is the creation of the Alabama Innovation Corporation (AIC) to support statewide entrepreneurship, research and development—and access to advanced technical skills. The state recently approved some recommendations that are expected to further transform the tech startup ecosystem in the state. It is no wonder why two cities in the state—Birmingham and Huntsville—have been simultaneously mentioned as possible nexus points of development in the tech industry.

Based on the approved recommendations, here’s what investors and founders can expect:

High-quality workforce talent

This is projected to be one of the major impacts of the recommendations. It has been recommended that a retention program targeting talent in science, technology, engineering and math (STEM) fields at Alabama universities and colleges, and an accelerator program that will educate students and faculty about bringing academic research, business ideas and technology from an idea to a licensable product, be created. These will help ensure that high-quality science and tech talent are created in Alabama universities and retained within the state. They will also be taught to translate their adults into real solutions and products.

The efforts of the state toward grooming talent will be extended to foundational and advanced levels of learning. Among the recommendations was the creation and support of programs aimed at increasing STEM and entrepreneurship offerings for kids from Kindergarten to through the 12th grade and the creation of assistance programs to fund nonprofits providing upskilling/reskilling programming to adults.

The state has committed to expanding high-speed broadband across the state in line with recommendations. This will ensure that the data network is optimized to support the activities of startups that are highly dependent on good data connection in every part of the state.

Investor and entrepreneur engagement

The state is working toward strengthening its investor and entrepreneur engagement efforts and bringing them to Alabama from everywhere in the world by hosting a world-class summit for entrepreneurs and investors and developing regionally based mentorship networks for founders and business owners.

This would also give founders an opportunity to expand their network, collaborate with other business owners and access opportunities.

Improve network coverage

Tax Incentives

The state has approved the tax credit recommended for research and development for certain high-growth industries and the creation of an angel investor tax credit that would equal 25 percent of an equity investment made into a qualifying high-growth business.


In addition to providing tax incentives to investors and founders, the state approved various fund schemes to give founders access to the capital they require. Two Alabama Innovation corporation-managed seed capital funds and a $2 million annual grant program to provide growth capital targeted at high-growth companies in need of additional financing will be created.

The corporation and state will also partner to apply for and implement the federal State Small Business Credit Initiative for the benefit of small businesses in the state.

We can expect the coming years to be both exciting and defining in the Alabama startup community, with an influx of businesses flocking to the Yellowhammer State.

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